How do TV Channels Make Money? | How Much TV Channels Earn?

Pratyusha Srivastava Pratyusha Srivastava
Feb 21, 2022 5 min read
How do TV Channels Make Money? | How Much TV Channels Earn?

Have you ever wondered how your favorite TV show or channel makes money? Well, yes! We all thought about it once. But wouldn't it be so intriguing to actually know how they make money. If yes, then you are at the right place!

We all are well familiar with the fact that television channels and shows generate their revenue through the advertisement they show in between. Daily soaps have become a very significant part of our daily lives.

Whether , youth, or adults; daily soaps are everyone's dear. With such popularity, its commercial prospects are also rising. The directors and procedures of TV shows are putting all their creativity into making content that basically hypnotizes the audience and attracts them more.

Contents from all languages, Bengali, Marathi, Hindi, Kannada, and others are preferred by a huge audience. From Yeh Rishta Kya Kehlata hai to Jal Nupur, people are crazy about their favorite daily soaps.

With such immense popularity, these shows earn very smoothly through Advertisements. In this article, we will be discussing how these TV shows earn money and how much they earn. Let's get started!

How do TV channels earn money?
How much do tv channels earn?

How TV Channels/Shows make money?

How do TV channels earn money?

While watching any TV show, news or any other thing, several advertisements run in between of all kinds (some on repeat). For displaying this advertisement in between the shows, advertisers pay some amount of charge to the TV channels. The amount of charge varies as per its duration as some ads are of 5 seconds or others of 10 seconds.

The major source of income for the TV channels is received from the advertisers on displaying their ads. In fact, this is not limited to India only, every daily soap and channel earns its money from advertisements only.

Although these earnings through advertising aren't fixed. Every TV channel charges differently when it comes to displaying ads at various times. The biggest advantage for TV channels is its procedure of money-generating through advertising. Β 

When it comes to how TV channels make money, they are split into two major categories. TV channels mainly earn through TRPs and DTH cable operators.

TRPs

TRP is elaborated as Television Rating Point. In this, TV shows and channels are evaluated by their numbers of views per second. This also determines the popularity and love for the show or channel among the audience. The higher the TRP, the higher profit TV channels earn.

Now, it comes to how they earn through this? Well, their popularity is alternatively specified by the number of advertisements shown during the show. As ads are the core for media houses and publications.

The amount of money generated through this is distributed among the producers and TV channels in an agreeable proportion. However, the TV channels earn by the GRP, Gross Rating Point. This is the standard advertising measure to calculate the ratio of total target market reached multiplied by the susceptibility frequency.

DTH Cable Operators

This is one of the very intriguing ways for TV channels to make money. We all have used or heard about the set-up-box connections. In this, we would have to subscribe to some channels so that we watch them.

When we do so, a little amount of the total charge is given to the TV channels. This generates a good amount of money for the TV channels. Generally, people subscribe to high TRP channels only, the other low TRP channels are just working towards increasing their views. They usually do not charge money as they come free.

Revenue from television advertisements across India
Revenue from television advertisements across India

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How much do TV Channels earn?

As we have discussed how the TV channels make money briefly, now it's time for how much do TV channels earn?

Through advertisements, there isn't any fixed rate of money that the advisor would pay. Suppose, a TV channel charges Rs. 2 lakhs for 20 seconds of the ad. Then on a 25 seconds ad, it would charge 2 lakh and 50 thousand. Different channels charge different amounts of money from the advertisers, based on their terms and conditions.

However, the rate of the ads generally depends upon the proportion of TRP as it evaluates the number of people watching the channel. When the TRP of any channel is high, its rate of advertisements also increases.

Talking about the highest TRP channels, Colors, Zee TV, Star Plus, Zee News, India TV, Sony, ABP news, and others, have the highest rate of advertisements. These channels charge around 3-4 lakhs for a 10-second ad.


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Conclusion

TV channels earn a fancy amount of money mostly by advertising. It basically shows some seconds of advertisement in between its show and then charges some amount of money to the advertising company.

The TV channels with the high TRP come out with the highest advertising rates. With an enormous fan base, TV channels are growing more promptly and are receiving great advertising deals. It's very fascinating to know how our favorite channel earns its revenue.

FAQs

How do free TV channels make money?

Free Tv channels earn revenue by displaying ads between the shows.

How much does it cost to start a TV channel?

To start a non news channel the net worth of the company should be around 5 crores.

What is the benefit of high TRP?

If a channel has high TRP they can charge a higher amount from advertisers.

What is the revenue model for TV Channels?

The two key methods of revenue for TV Channels are:

  • Subscriber fee
  • Advertising

How many TV channels are there in India?

There are 850 TV channels in India.

What is full form of TRP?

TRP stands for Television Rating Point.

Who calculates the TRP for Television Channels?

TRP is calculated by Broadcast Audience Research Council using β€œBAR-O-meters".

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