India magazine industry thriving as big players moving in

By Rina Chandran

MUMBAI (Reuters) - When Conde Nast launched its premium lifestyle magazine 'Vogue' in India last year, it carried a whopping 168 pages of advertisements of a total 400 pages.

Now, the publisher is preparing to launch its luxury men's magazine GQ and expects a similar rush of advertisers in Asia's third-largest economy, where rising incomes and growing literacy are boosting readership and revenues of magazines and newspapers.

From specialist magazines on whisky, golf and parenting, to regional-language newspapers and financial dailies, new titles are coming thick and fast in one of the few markets in the world where advertising and readership for print media are expanding.

"It's a fast growing economy and with consumption so robust and with incomes rising, it's a fertile ground for the print media," said Vivek Couto, executive director of Hong Kong-based research firm Media Partners Asia.

"There is also a buoyancy in print advertising that is encouraging new launches and niche publications in particular."

Print publication advertising revenues in India generated 94 billion rupees ($2.4 billion) in 2007, or 48 percent of all of the country's media advertising revenues, PriceWaterhouseCoopers (PWC) said in a recent report. TV ads generated 41 percent.

With the economy having grown at an average rate of 8.75 percent in the last four years, middle class incomes have risen, boosting demand for niche magazines on health, leisure and finances.

Growing prosperity in rural areas is also encouraging demand for publications in India's more than 20 official regional languages.

Revenue for newspapers and magazines in India, where reading at least one newspaper in the morning is sacrosanct, grew at an average rate of 15 percent in the last four years, higher than anywhere in the world, PWC said.

The growth is helped by a young demographic, more working women, rapid urbanization and smaller households, PWC added in its report.

The print publication boom in India contrasts sharply with more mature markets in the West where circulation figures and advertising revenues are down as readers move to the Internet.

BOOM

India in 2005 allowed 100 percent foreign investment in non-news publications, keeping the cap for news at 26 percent.

Early investments included Independent News and Media's 26 percent stake in newspaper publisher Dainik Jagran, Pearson Plc's 14 percent in Business Standard newspaper, Henderson Ventures' investment in HT Media and BBC Worldwide's magazine venture with Bennett, Coleman & Co.

More recently, private equity firm Blackstone Group put $150 million in regional publisher Ushodaya Enterprises, Warburg Pincus moved $33 million into the Dainik Group and DE Shaw invested $39 million in Amar Ujala Publications, according to research firm Venture Intelligence.