Expert (Moscow), September 1, 2003

The first business TV channel has appeared in Russia. Russian television starts working for target audiences like western TV channels

TELEVISION MARKET

RBC TV, the first business channel in Russia is to start broadcasting this week. This TV channel has been created by the Russian online information agency RosBusinessConsulting, and it will broadcast 24 hours a day with 19 hours of live broadcast (from 7 a.m. to 2 a.m.), which is a record for Russian TV channels. The programming of RBC TV will include news and analytical programs of an economic, financial and business character. The new digital channel is available for subscribers of satellite channels NTV Plus, Kosmos TV and those who have access to the Moscow cable and terrestrial networks Mostelecom, Comcor-TV and Divo TV. In September RBC TV is expected to appear on one of the cable channels in St. Petersburg and later in 12 Russian cities with a population of over one million people.

The idea to create a Russian business channel is not new, however, all previous projects have not been put into practice for various reasons. The launching of RBC TV has become possible for several reasons. According to RosBusinessConsulting General Director Yury Rovensky, they are an already formed target audience for such a channel, a dynamically growing advertising market, high demand for TV advertising and the increasing demand of the public for quick business and economic information.

The emergence of the business channel in Russia meets world tendencies. According to VGTRK deputy head Andrey Bystritsky, there is a diversification of television towards the emergence of special niche channels in the world. As a result such western business channels like Bloomberg, CNBC and others appeared. In this respect, RBC TV testifies to the appearance of this tendency on the Russian market, he thinks.

At the same time, RBC authorities do not detract their own competitive advantages as the creators of such a channel. These are RBC's broad informational base on economic and business issues, unique technologies for data transmitting that have been developed by RBC and the awareness of its target audience that will be the same for RBC's website and the TV channel. RBC TV General Director Artyom Inutin describes this audience as top and middle managers, finance specialists, managers of investment companies, specialists and managers of companies that work on the business-to-business markets, heads and experts of auditing, consulting and insurance companies, state employees and the country's economically active population. RBC TV is planning to attract from 2m to 5m TV viewers, mainly in Moscow and St. Petersburg, at the first stage. The three-year goal is to cover a 7m to 8m audience by broadening the coverage area. According to optimistic forecasts, the channel's potential audience might be up to 12m people in the future.

According to Alexander Kostyuk, the director for TV ratings of Gallup Media, the estimation of a target audience of a business channel at several million people at the initial stage of broadcasting is a very optimistic forecast. Andrey Bystritsky also points to the narrowness of a potential audience of a business channel. "There are very few consumers of business information. For example, CNN's audience is only four percent of a country's population, Euronews is also four percent, BBC's audience is two percent. Our digital TV broadcasters have up to 500,000 subscribers or cover about 1.3m people, according to rough estimations. However, it does not mean that all them will watch this channel. Possibilities of cable networks are rather limited currently".

Meanwhile, RBC TV owners believe that cable television is developed actively in Moscow. Local cable television providers provide services in all new apartment buildings of good quality and demographically favorable districts of Moscow. "We are planning to broadcast through the majority of such providers and it will be quite enough for our niche channel".

Creators of the TV project believe that coming to regions is technically promising but not very efficient from the point of view of target audience. Since regional television appeared considerably later than in the capital, digital technologies were actively used during its creation. However, even taking into account the fact that regional broadcasters are usually unable to create qualitative content, the presence of the business channel in regions amid narrow potential audience is unlikely to be relevant.

Two in one

Authorities of the new channel are planning to solve problems with broadening its audience by making a highly qualitative TV product. The concept of the new channel is to combine two broadcasting formats: informational and analytical. It is reflected in the channel's programming that includes news programs (general news with economic content) that are to be aired 36 times a day, analytical programs about developments on the stock, financial, consumer and other markets, programs about the most urgent events and tendencies in the Russian economy, interviews with successful entrepreneurs and managers, programs on macroeconomic topics etc. Some part of the airtime will be given to information that is necessary for businessmen in their everyday life. These are surveys of tourism, fashion, business style, rich lifestyle, automobiles, weather and wholesome advice. Besides permanent anchors and hosts, experts and analysts will be invited to programs.

Some foreign business channels like Bloomberg, CNBC, N-TV and some other have been, to a certain decree, an example for RBC TV. However, according to Rovensky, the Russian business channel will differ considerably from these foreign channels. Firstly, western channels are clearly divided into informational and analytical (for example CNBC is an analytical channel, while Bloomberg is an informational news channel). RBC TV is planned to be informational and analytical. Secondly, the lion's share of the airtime at western channels is devoted to events on stock markets. "This market is poorly developed in Russia, only an inconsiderable part of the audience is interested in it; the concept of our channel is the broad coverage of all business and economic events," Rovensky said.

The company's authorities admit that the creation of quick-look content of the channel, which operates mainly in live broadcast, would be impossible in an empty place, without the online information agency RBC. The channel is actively supported on an informational basis by the Internet company RBC, by its technologies of presenting and disseminating information and by human resources. "Our website and the new television channel will be closely bound to each other. Television signal will be transmitted through the Internet and there will be many links to TV programs on the website and commentaries broadcasted by the channel will be placed on the website too. In its turn, the channel will constantly refer to the company's website. Currently, the main task for us is to integrate the website and the channel into a single information area," Inutin noted. At the same time, according to RBC TV authorities, the channel will not be an additional ground for disseminating RBC's information. "We have signed agreements on using information and on information exchange with domestic and foreign information agencies," Rovensky admitted. The quality of the content of the business channel will depend not only on how fast information appears on the air, but also on the qualification of the personnel. Currently, RBC TV personnel, which includes some 500 people, consists of employees of three categories. They are TV journalists who used to work at other Russian channels and who are aware of television technologies, specialists with economic backgrounds and practical experience who earlier were employed in the real sector of economy and analysts and journalists of RBC who have been employed by RBC TV.

Image instead of ratings

More than $20m have been invested in the creation of the channel. RBC expects that the invested resources will be paid back in two years and in three years the channel will bring planned profit. The only source of revenues of the company, according to its top managers, is TV advertising.

Advertising specialists say that the structure of advertisers of the first business channel will be similar to the structure of western business channels and serious magazines for men. These are investment companies, sellers of elite real estate, travel agencies, banks, hotels, companies that provide business services, sellers of expensive products, business-to-business proposals etc.

RBC TV's advertising policy is based mainly on the loyalty of the current advertisers of the Internet company RBC. "RBC's revenues from advertising on the Internet exceeded $7m last year. This is a unique figure for Russia and the Internet. Most our advertisers have expressed desire to broaden their advertising budgets for RBC TV. We have made more than 20 advertising agreements that have been paid already," Rovensky noted.

Besides activities with constant RBC advertisers, the channel is planning to attract new clients. However, it is not clear yet how they will be attracted. Advertisers make a decision to place their advertising in programs of a common TV channel on the basis of ratings of a channel and its programs. Meanwhile, a business channel, by definition, is not a rating channel and the methodology of evaluating audiences used at common TV channels will not work here, Rovensky believes. The channel's authorities propose their potential advertisers to take into account the reputation of the RBC brand name and the quality of the target audience the channel will attract.

At the same time, some specialists think that as soon as RBC TV decides to broaden the circle of its advertisers by attracting new clients, changes will be necessary. "Advertisers will not give advertising blindly. I think that not every company has implicit confidence in RBC's image; that is why it will be hard to sell advertising without some research. It is obvious that methodology used for assessing the audience of a cable or a satellite channel differ from that used for mass channels. We use one such method to evaluate NTV Plus's audience currently," Kostyuk remarked.

An increase in the channel's revenue will be promoted by direct advertising as well as by other ways of commercial broadcast. Currently, RBC TV has 28 fly away cameras that can provide a live broadcast from different companies and organizations. On the one side, it enables the channel to get quick commentaries from the experts of these companies. On the other side, there is a possibility of giving airtime to these companies on an advertising basis. The terms and conditions of broadcasting this or that newsmaker are defined by the channel's editorial policies. "If we are interested in the opinion of this or that market participant, we will ask a question and he or she will respond to it in a live program. At the same time commentaries of a specialist that are made regularly might be based on an advertising basis," Rovensky specified.

Besides authorities of the channel, a specially formed expert council of RBC TV will watch the content of aired programs. The heads of major companies, former ministers of the Russian government, TV professionals and bankers have been invited to participate in it. Among them are Yevgeny Yasin, Andrey Nechayev, Vladimir Pozner and others. "This is a kind of external independent editorial council. It is not bound with material expenses of the channel and the company's internal life like its managers. Its task is to analyze the content of the channel and recommend ways for its improvement," Rovensky specified. However, this council has been created not just for giving advice. "The work in live broadcast is a certain element of forming public opinion, influencing the market. If this or that company, this or that analyst or newsmaker misuses the possibility of influencing the audience during a live broadcast, we will have the right to cancel the advertising agreement with this company. The final decision on such a question will be made by the expert council".

There is no single opinion among specialists and potential audience on the outlooks for the new TV channel, as well as there is no univocal evaluation of the economic content of RBC.ru on the market. Meanwhile, given the previous development of RBC, it is hard to deny that its authorities are able to create the "price" of their products. The new TV channel may become another confirmation of this exceptional skill.

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Operating activities of RosBusinessConsulting

INFORMATION AGENCY

ADVERTISING

MARKETING COMMUNICATIONS

SCIENTIFIC RESEARCH

CORPORATE SOLUTIONS

INTERNET SOLUTIONS

SYSTEM ITEGRATION

REGISTRATION OF DOMAINS AND HOSTING

ADDITIONAL SERVICES

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Yury Rovensky believes that the business channel RBC TV will be paid back in two years.

Bar graph
The turnover of RosBusinessConsulting in million USD

Source: the company's data

Lina Kalyanina