New press markets: 'People want to be seen reading a paper'

New newspapers some backed by governments, others by business moguls and international conglomerates are springing up from Rwanda to Tajikistan, attracting readers and advertising revenues. In many of these markets, increasing literacy rates dovetail with growing disposable income to create millions of new daily readers. And some Western media companies are forging partnerships and trying their hand at start-up companies as well.

Reading a newspaper is something to aspire to, believe media executives in India one of the fastest growing newspaper markets instead of a throwback to a bygone era as it is perceived in much of the West.

"Anyone who can read or write is still looked at with a bit of awe" in many markets in India, says Rajesh Kalra, a veteran journalist who is now chief editor of IndiaTimes, the internet arm of Times Group, which publishes The Times of India. This has a circulation of 3.5 million and claims to be the biggest English-language paper in the world. Times Group is introducing new editions of the paper in four Indian cities this spring.

When people first learn how to read, they want to let people know, Kalra says, and "the first thing you want to do is be seen to be reading a newspaper". The literacy rate in India hovers at about 61 per cent, according to Unesco, but the number of literate youths is above 76 per cent, signalling that education is improving. The number of daily newspapers grew from 185 in 2005 to 287 in 2006 according to the World Association of Newspapers. Global newspaper advertising spending will increase to $130bn in 2010 from $125bn in 2007, according to ZenithOptimedia, thanks in part to growth in India and other emerging markets. This trend is reversed in North America, where newspaper advertising revenue in the United States fell 7.9 per cent in 2007, according to the Newspaper Association of America.

A jump in income in many emerging markets often corresponds with an increased desire for business news, as consumers become investors in local or international markets. Meanwhile, an increasingly global financial system means that experienced investors are now active in once far-away corners.

"We do see a big potential in emerging markets," says John Ridding, chief executive of the Financial Times. "There is strong and growing demand from these markets for strong industry and business analysis."

In April, the Financial Times launched a Middle East edition from Abu Dhabi, which Ridding hopes will increase the paper's circulation "substantially" from the several thousand readers it currently has in the area. In India, the FT sees "big opportunities for expansion" and is working on an "exciting project," about which he would not elaborate. But several sources in India who did not want to be named say the FT is in advanced talks with the Indian media conglomerate Network 18 to produce a new daily business paper.

In China, the FT is about to start a monthly Chinese language magazine called RUI, which in Mandarin Chinese means "intelligence." The magazine, aimed at the upper-middle-class consumer, will carry a mix of lifestyle and money-management articles.

While spending on internet advertising is rapidly increasing in the United States and Western Europe, the faster-growing markets of Asia and Latin America are all about old media, as Martin Sorrell, chief executive of the advertising company WPP Group, noted in February. But it is still unclear whether foreign newspaper companies will be able to make up revenue that they have lost in the West in these new markets.

Media companies in emerging markets, though, are enjoying growth that their Western counterparts can only envy.

"Unlike the developed markets, India is at a fundamentally different stage of its life" when it comes to media consumption, says Haresh Chawla, group chief executive of Network 18 (Chawla would not comment on any talks with the Financial Times).

The company also has a joint venture going with broadcaster CNBC, as well as with Viacom, which brings MTV and Nickelodeon to Indian audiences. "There is a huge synergy in newsgathering," Chawla continues, "and owning a newspaper will round off Network 18's media offerings." Unlike many media conglomerates in the West, the company is not family owned, nor is it "a 50-year-old or 100-year-old company," says Chawla. "We are just a 10-year-old baby, built with professional talent."

The proliferation of newspapers does not mean that journalism is necessarily flourishing. In some of these new or fast-growing markets, absolute freedom of the press is untested, and unbiased news coverage is unfamiliar. In others, editors and journalists are openly mixing advertising and editorial content.

Some founders do not even bother to pay lip service to the idea of spreading truth, uncovering injustice and comforting the afflicted. "Of course it's all advertising-driven and nothing else," says one Indian newspaper executive, who did not want to be named, because he did not want to alienate any readers or potential advertisers.

At the end of the day, if the paper is not making money, it will stop printing, he argues. Indian newspapers sell for about one or two rupees each, but cost many more times that to produce, so they remain heavily dependent on advertising.

In some developing markets, new newspapers do not even offer news at all. Instead, Tajikstan's Three in One, for example, plans to carry crosswords, television schedules, and questions and answers on medical problems, according to its founder Akbarali Sattorov. "Such a product is much in demand in our society," he claims.

This article first appeared in the 'International Herald Tribune'