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Category: Events

  • IDOS 2014: News broadcasters still struggling to make money

    IDOS 2014: News broadcasters still struggling to make money

    GOA: The news television industry has been witnessing losses for several years now. To throw some light on what are the hurdles and what needs to be kept in mind while forming regulations, NDTV vice chairperson KVL Narayan Rao, Times Television Network MD and CEO MK Anand and BBC World News India COO Naveen Jhunjhunwala took the stage at IDOS 2014 for the session ‘News Television- a specialised beast’ that was moderated by Castle Media founder Vynsley Fernandes.

     

    The session took off with a keynote from industry veteran Rao, who spoke of the issues facing the most competitive news industry. “News has always been a high cost, low return industry and since 20 years, there has been an unholy dependence on advertising revenue in an environment that doesn’t seem to be changing,” he said while adding that one needs to consider the importance of news in such a landscape. “Not a single news operator in this country is making money,” he stressed.

     

    The recent extension to digitisation has also not gone down well with Rao, who just this week stepped down as the president of the News Broadcasters Association. “Digitisation was to finish by this year but has been extended till 2015 and 2016. To say the least, I am very disappointed with this decision,” he said.

     

    As far as regulations are concerned, he says that content should always be kept separate from carriage. “The business environment that we are operating in is one where we pay a large amount of money as carriage fees. For most news broadcasters, one third of operating cost goes as carriage fees while 90 per cent of revenue is generated from advertising and in some cases 100 per cent. All news broadcasters today pay a large amount as carriage fees and it is a terrible burden that we find impossible to bear,” said he. All the stakeholders must see the way the news channels operate and not look at regulations in isolation.

     

    News channels during primetime end up showing only panel discussions because of the lack of resources. The western countries have subscription revenue of up to 60 to 70 per cent. All these issues were meant to change after digitisation with subscription revenues kicking in and carriage fees eventually coming down. However, Rao hopes that the new government helmed by Narendra Modi would do all it can in its new ‘Digital India’ plan.

     

    He spoke of the statement by the Editors’ Guild regarding denial of access to journalists by government and increasing number of significant government authorities taking to social media to give information. He says that this serious issue needs to be addressed since news is not about press releases but rather about ‘ferreting information out’.

     

    Adding to the issues faced by the industry was Anand. He said that the last six months have seen a loss of collective bargaining due to the deaggregation paper by the Telecom Regulatory Authority of India (TRAI). “The paper has hit news broadcasters and unless one diversifies into entertainment, it is difficult to survive,” he said. In order to make money, the idea is generally to go heavy on branding and marketing and create an aura around the channel. The lopsided ad sales revenue also adds to the woes.

     

    Jhunjhunwala said that the BBC has been broadcasting news for decades and the technological advancements have allowed it to make it smoother and more cost effective.

     

    The ad cap has also hit them hard by restricting advertising air time to 12 minutes per hour. Here, the panel agreed that there are times when channels go live for hours without showing any ads and there is no provision to make up for the lost time. Fernandes questioned that in such a scenario, could there be alternative sources of revenue that can be put into use.  Rao said that now, to monetise news one needs to generate revenue through different streams such as sponsorships and associations. “But how can you not have subscriber revenue?” he questioned.

     

    Fernandes then questioned if there should be a limit on the number of channels that exist to which Rao said that the government should not curtail the number of channels because it is a free market. However, he feels the politicians and political parties should not be allowed to be in news.

     

    Anand said that the regulator could think about regulating carriage fees with some focus on news channels. He also pointed out that a decade ago, ad spots on news channels were sacrosanct but today it is being sold at one third the rate.

     

    Jhunjhunwala said that the government could look at raising the FDI limit on news to bring in more investment. There were talks of raising it to 49 per cent but no one has addressed the issue.

     

    Rao finally concluded by saying that though the digitisation deadline has been extended it will hopefully iron out things.

  • Siti Cable commercially rolls out its DOCSIS 3 broadband service in Delhi NCR

    Siti Cable commercially rolls out its DOCSIS 3 broadband service in Delhi NCR

    GOA: Delayed digitisation is the hottest topic of discussion in the cable TV corridors.

     

    With digitisation comes the hope of increased Average Revenue Per User (ARPU) and also the realisation that it is broadband that will help the multi system operators (MSOs) to increase their ARPUs.

     

    Siti Cable is doing just that. The MSO, which for the last two months had been piloting and testing its DOCSIS 3 technology in the Delhi, NCR region, has now officially launched it in the region. Confirms Siti Cable CEO and executive director VD Wadhwa, “Yes, we have commercially launched the service in these areas.” 

     

    The MSO though has started with Delhi-NCR; it will soon take the service to every city where it has a subscriber base of more than 50,000.

     

    It is estimated that the MSO is investing anywhere close to Rs 35 lakh to Rs 40 lakh in markets with 50,000 subscribers. According to Wadhwa, as a thumb rule, of every 100 cable TV households, close to 10-15 per cent convert to broadband households. “We are taking the figure at 15 per cent,” he says.

     

    “Upgradation of homes passed cost close to Rs 500 per subscriber. So if, of the 100 households, 15 per cent opt for broadband, then we are looking at an investment of close to Rs 5000 per subscriber,” he informs.

     

    The speed for DOCSIS 2 will go up to 40 mbps, while for DOCSIS 3 will go up to 100 mbps. As for the pricing, Wadhwa says, “Our pricing will be highly competitive. We are just in the phase of finalising the tariff plan. We will have different packs for different subscribers.” 

  • IDOS 2014: ‘Digitisation delay is good if industry fixes issues’

    IDOS 2014: ‘Digitisation delay is good if industry fixes issues’

    GOA: The cable TV industry, which had earlier expressed disappointment over the government’s decision to postpone cable TV digitisation in phase III and IV, now believes that delay in digitisation is good if the industry, after getting a breathing space, fixes various issues, which it witnessed in the phase I and II.

     

    The extension would not strain the financial health of the industry as the need of the hour is to see digitisation on track after the timeline shift and create value and increase the Average Revenue Per User (ARPUs).

     

    Some experts feel that the additional inventory carrying costs and investments in infrastructure that the industry is incurring now, would impact their topline and thus have a brunt on the bottomline.

     

    Also, with the stable government now at the centre led by NDA, media companies can raise capital and the industry is quite bullish about the valuation benchmark.

     

    The government had previously set a target of digitising the cable TV services in the entire country by December 2014. Information and Broadcasting Ministry recently issued a notification as per which the deadline for the areas which came in phase III was extended from 30 September  2014 to 31 December 2015 and phase IV for December 2016.

     

    “Delay is never good. But, if one implements the learning from the first two phases, it may have a positive impact. Phase I and II haven’t so far reaped any fruits with zero value creation. The players are still fixing billing and other issues,” says HSBC Analyst Telecom associate director Rajiv Sharma, during a panel discussion on ‘Ecosystem Economics of the Future’ in Goa at IDOS 2014.

     

    According to Exponentia Capital principal Neeraj Bhatia, the delay is a welcome development. “It was required considering the ground reality. The earlier deadline was impractical,” he adds.

     

    “The earlier phases involved capital expenditure as more revenues were flowing through the system. MSOs were collecting less and paying more, as a result of which they saw no net benefit. So we started to question the business model and whether digitisation had anything for MSOs,” opines Bhatia.

     

    “We are not ready for phase III and IV,” he informs.

     

    The delay has given a breathing space to the MSOs to figure out the next step. “One needs to take a stand on various economic issues. This includes gross billing among others which impact people,” says Axis Bank group head strategic corporate group Salil Pitale.

     

    Citing reasons for the problems faced in other phases, Sharma informs that the cable industry is a fragmented one with just six big MSOs, around 6,000 other MSOs and 70,000 LCOs.

     

    According to the experts, value creation comes from customer ownership and thus investors will continue to invest.

     

    The rollout of the next two phases, after the delay will be smoother as it could bring some consensus amongst stakeholders. In phase III and IV, the stakeholders should ensure that revenue comes from day one and not after two years, opines Sharma.

     

    “While there was a tug of war between the MSOs and LCOs in the earlier two phases that need not be the case going forward. Both need to look forward and pool money,” says Bhatia.

     

    The extension has also thrown an opportunity for MSOs to opt for voluntary digitisation, feel the experts.

     

    There are a few financial investors who are getting excited about the growth story that digitisation proposes. “Delay is good as it also allows the MSOs and LCOs to resolve the billing issue,” explains Bhatia.

     

    There are mixed opinions on the extension of digitisation deadline. The big question now is: ‘Can the cable TV industry fix the issues in the next one year by executing the lessons learnt?’

  • IDOS 2014: Trust amongst stakeholders holds the key to increasing ARPUs

    IDOS 2014: Trust amongst stakeholders holds the key to increasing ARPUs

    GOA: The broadcasters, multi system operators (MSOs) and the local cable operators (LCOs) need to trust each other to solve most of the issues that affect the cable TV industry. While the dialogue between the trio has begun, there is still lack of trust and this has to change, is what the industry stalwarts expressed at the ongoing India Digital Operators Summit (IDOS) 2014, organised by Indian Television Dot Com and Media Partners Asia.

     

    “The current reality is that the players within the chain have at least started talking to each other, which was missing earlier. So with digitisation, this is one of the most positive moves that has happened,” says IndiaCast CEO Anuj Gandhi. He also emphasises on the need for the MSOs to resolve the jigsaw puzzle with the LCOs to ensure better Average Revenue Per User (ARPU). “The MSOs need to get the LCOs on table and understand their issues,” he says while adding that the last mile needs to be seen as partners in the cycle.

     

    Agreeing with him was Hathway Cable and Datacom MD and CEO Jagdish Kumar, who feels that the last mile needs to get returns on the services he provides. “But that will need collective work. We need to grow the ARPUs from the current Rs 180 to Rs 250-Rs 300,” he says.

     

    For Siti Cable CEO VD Wadhwa, the reason for lack of trust lies in the history of cable television ecosystem. “Historically, the understanding has been that the last mile retains a large part of revenue. Now with digitisation, underdeclaration is not possible and so the LCO is suffering from fear psychosis that he will lose his subscribers,” he says.

     

    The Siti Cable CEO also feels that there is a need for MSOs to give the LCOs access to the SMS so that they can feel a certain ownership towards their customers. “There is a need for a policy which is well documented, transparent and honoured,” he adds.  

     

    From the time government announced digitisation of cable TV homes, it is the regulations and the courts that have been driving the business. “Let’s not get the regulator involved in areas where we can resolve the issues. We need to put together a commercial document which is uniform across,” opines Star India president and general counsel Deepak Jacob.

     

    One of the biggest concerns for the stakeholders is increasing the currently low ARPU. “The DTH industry has done well on this front. While we started with Rs 150 in 2008, we have gone up to Rs 200-Rs 220 in phase III and phase IV markets, where the cable industry still has a ARPU of Rs 150,” informs Videocon d2h CEO Anil Khera. He also feels that the cable industry cannot have different rates for different markets.

     

    The DTH industry faces a huge threat from Freedish, which is becoming a great proposition in phase III and phase IV. “I see more threat from Freedish, if the platform gets the general entertainment channels onboard. According to me, all these channels should be made ‘pay’ on Freedish as well,” opines Khera.

     

    While talking of the threats the industry currently faces, Jacob also highlights the threat that comes from state governments playing a role in the content and distribution market. “The Tamil Nadu and Punjab markets are pretty much locked because of the monopoly of the state government in the region. The disease is growing, with more states looking at the same. We should ask the government to implement recommendations to curb this,” he says.

     

    Another point discussed during the session on ‘Unity and the way forward for the next five years’ was if the DTH operators have an opportunity in phase III and phase IV markets with the extension of digitisation dates.  Says Dish TV CEO RC Venkateish, “DTH in phase I and II continued doing what it did when it had started. But phase III and IV is a different kettle of fish and so we at Dish launched Zing. The delay means loss in momentum.”

     

    Hathway is looking beyond cable in the phase III and IV markets. “We are looking at broadband as the margins from here are far higher than cable,” informs Kumar who says that while broadband currently is at 20 per cent, it will increase significantly in the future.

     

    As for increasing ARPUs, Gandhi suggests that there is need to look at the basic packs. “We need to work on making the basic pack light, so that consumers see value in the higher packs,” he says. According to him, the MSOs like the DTH operators should start getting into a multi-year or five year deals with broadcasters, rather than the one year deal that they have currently. “This will help him sort his content cost and also give them more confidence, which they can then pass on to the LCOs,” opines Gandhi.

     

    The MSOs have taken a lot of debt for digitising phase I and phase II. “Now when we approach the investors, we will need to have a roadmap for them to invest,” informs Kumar.

    Can phase III and phase IV be underestimated, answers Jacob, “We shouldn’t underestimate these two phases. The households in phase III spend close to Rs 300-Rs 350 on telecom and VAS services, while phase IV spends some Rs 250 on it. And these households are trying to watch all the content on their phone. So this is the matrix the cable TV industry should follow.”

  • IDOS 2014: How can the pay TV industry be made better?

    IDOS 2014: How can the pay TV industry be made better?

    GOA: India Digital Operators’ Summit 2014 kicked off at The Leela in Goa on 25 September. Opening the conference, Indiantelevision.com CEO and editor in chief Anil Wanvari and Media Partners Asia (MPA) executive director Vivek Couto gave a brief on the state of the TV nation and transition to the broadband digital economy.

     

    Wanvari highlights how the state of the industry was a few years ago and what it has become now after the advent of conditional access system (CAS) and digital addressable system (DAS). Content makers aka broadcasters have been demanding more revenue from the pay TV industry. While the capex and opex for them has been high, the return continues to be low. The MSOs and DTH operators have been investing to expand their headends and build subscriber base respectively. “While it is a good business now, the real question is if each one of us is willing to make it a great business?” he asks.

     

    In order to strengthen the business, Wanvari recommends a few suggestions that could help grow the industry. The first thing is to look at digitisation and pay TV with a changed mindset that it will be beneficial to all. The government could look at setting up a digitisation transition fund that will help educate, train, seed capital and reward people who follow the rules and ensure strict penalties for those who don’t.

     

    Subscriber management system (SMS) should be set up with correct details and billing of the services provided to customers. The government could also look at laying down minimum standard rules for set top boxes (STBs) to ensure quality control. His final suggestion is to leave pricing to the market rather than initiate 10 to 15 per cent price rise every now and then.

     

    Providing a glimpse into MPA’s study on the pay TV industry in India, Couto says that out of the 262 million households in the country only 162 million houses have a TV. In this, 27 million is taken up by the free to air service providers such as Doordarshan and Freedish while the rest comes under cable and satellite.

     

    Couto highlights that over Rs 32000 crore has been invested in digitisation since 2005 with a bulk of the investment coming from the DTH operators followed by the MSOs and LCOs since 2011. Out of this, over Rs 11000 crore in the last 24 to 30 months has been invested by MSOs and LCOs. “India offers scale but limited monetisation,” he says. What digitisation will do primarily is increase transparency, addressability, tax collection and employment. Over 120 million STBs are needed over 10 years and nearly 47 per cent share of the total market will come through broadband.

     

    The tiff between the three stakeholders continues with the LCOs fighting for revenue share, MSOs facing crash crunch and broadcasters worried about increasing carriage fees which the MPA report stated as having increased by nearly 14 per cent in Q1 FY2015.

     

    In terms of scale, India struggles as the country with the lowest average revenue per user (ARPU) but it has one of the best channel services. Couto says that it is time for the industry to move to retail pricing than stick to wholesale tariff because the competition will keep the prices low. The need of the hour is for MSOs and broadcasters to come together and design packages, incentivise upselling, indentify opportunities for sub segmenting and create new genres. The key to which lies in raising prices to consumers.

  • IDOS 2014: A must, say industry stalwarts

    IDOS 2014: A must, say industry stalwarts

    MUMBAI: The broadcast, cable, DTH industry and the regulatory body is all set for the biggest confab of the year.  To be held in Goa, starting 25 September with a big bang opening night party organised by HBO Hits and Defined, all the heads of India’s pay TV market, distribution, broadcast, cable and DTH industry are gathering to brainstorm and suggest the way forward for the already delayed digitisation at the Indian Digital Operators Summit (IDOS) 2014. 

     

    The extension in the deadline as announced by the Information and Broadcasting Minister Prakash Javadekar has somewhat delayed the plans of many in the pay TV circuit. While the biggest concern currently is smooth rollout of the phase III and phase IV of digitisation, industry biggies will also ideate on how, with consumers moving to other screens apart of television, can be monetised.

     

    The tenth edition of IDOS, is themed around, ‘Digitisation: The Next Big Push.’ Organised by Indian Television Dot Com and Media Partners Asia, the conference unites stakeholders across the value chain to drive meaningful dialogue and facilitate practical solutions to drive the content and distribution markets forward.

     

    “The forum provides opportunity for interaction with all key people involved in the broadcasting sector, not only digital operators but others as well,” says Dish TV CEO RC Venkateish.

     

    According to Venkateish, the theme is very relevant given digitisation is an ongoing process. “That process is something we all hope will take the industry to the next level,” he adds.  The Dish CEO expects the conclave to be a platform for exchange of news, information and opportunity to share some of their view points with the regulator.

     

    For Maharashtra Cable Operators Foundation president Arvind Prabhoo, IDOS’ concept is most pertinent in today’s market scenario. “Once digitisation was announced, all the players in the ecosystem needed to come together and voice their opinion to benefit from it,” says Prabhoo adding that Indiantelevision.com was the first to identify this need and organise such a conference.

     

    “It is a really good one and is only going to get bigger,” he opines.

     

    On the theme for this year’s IDOS, Prabhoo says, “Everyone needs a push, after all the struggle that happened in phase I and phase II. There had to be some kind of out-of-the-box thinking. And this is what will come out in the next two days of the conference.”

     

    Prabhoo is looking forward to Telecom Regulatory Authority of India chairman Rahul Khullar, Hathway director Viren Raheja and Tata Sky MD and CEO Harit Nagpal amongst others to come up with the kind of impetus that can be given by large corporate houses.

     

    BBC Global News India COO Naveen Jhunjhunwala is another industry stalwart who is looking forward to some meaningful sessions and interactions at IDOS, this year. “The TV industry is progressing rapidly and the theme for this year’s conference is a positive step towards bringing together the stakeholders and tapping into opportunities that exist in digitisation,” he concludes.   

  • TV industry gears for 13th Indian Telly Awards

    TV industry gears for 13th Indian Telly Awards

    MUMBAI: The night of glitz and glamour is all set to roll out tonight. Amidst high octane performance, the ground event for the 13th Indian Telly Awards will be held today at the Reliance MediaWorks in Filmcity, Goregaon.   

     

    The awards will see the introduction of new categories, special awards and extremely entertaining and power packed performances.

     

    This time around, the jury process has been redefined and is encouraging more and more involvement from industry insiders to be part of the group that decides the worthy winners. Which means that not only noted veterans and established television professionals, but also channels and production houses will be involved in the intrinsic and exhaustive judging system.

     

    TV’s best will be revered as some of the favourite stars put up some stunning performances.

     

    To know about the performers, watch the exclusive telecast on Colors soon.

     

  • Moving beyond television

    Moving beyond television

    MUMBAI:  The online space for content is growing, not just in terms of online production houses coming up but also in terms of innovation. But how much of this affects the distributors and operators in India? Well! that was the talking point of a discussion titled ‘Beyond the Television Screen –Distributors and Operators’ at the afaqs! TV.NXT 2014 summit.

     

    Joining the panel were BARC India chief executive officer Partho Dasgupta, PwC India Entertainment and Media leader Smita Jha, SureWaves Media chief operating officer Mandar Patwardhan, BBC Global News (Indian operations ) chief operating officer  Naveen Jhunjhunwala and Indiantelevision.com founder, CEO and editor in chief Anil Wanvari who also anchored the discussion.

     

    Dasgupta began by saying that while today a lot of new and innovative content was available on multiple platforms, the popularity depended on the quality of content being produced.  When asked if the rating agency would be taking steps to monitor any online content, Dasgupta said, “We will set up a system that is platform agnostic and even monitor digital content.”

     

    Enlightening the session with interesting facts, he said that while starsports.com received 2.8 million hits during the last IPL season, NDTV received 13 billion hits for its coverage of the Lok Sabha elections.

     

    Talking about BBC’s digital strategy, Jhunjhunwala emphasised on how a specialised in-house team has been setup that specifically caters to producing online content for its Indian website. “The India page has a lot of content that is localised. The challenge for us is to have Indian local content that has an international perspective,” he said.

     

    Jha, commenting on global trends, revealed that worldwide TV advertisements were growing at five per cent while internet advertising was growing at 10 per cent. But the size of the internet advertising market is still evolving. “Advertising agencies today have specific teams to produce online content. It is essential for brands today to come up with one to two commercials every 15 days,” she said.

     

    On the other hand, Patwardhan said that while traditional mediums have already begun to adapt to the digital environment, the reverse could also take place wherein online content producers would switch to the linear television format and a crossover would take place.

     

    Wanvari at this point interjected saying that broadcasters today solely wanted to own the IP and producers had very little time, since they are busy with their shooting schedules, to put forward their point for joint ownership of an IP. 

     

    Jha in her parting words said that the IP should rest with the producer and not the broadcaster so that innovation could be introduced in multiple formats for audiences.

  • Pay for content and not channel say broadcaster legal counsels

    Pay for content and not channel say broadcaster legal counsels

    MUMBAI: Regulation in India, unlike the US, is very static. Not only this, any regulation that comes out, does not address the future, but the past. New technology is proving to be a remarkable challenge, not only for the industry, but for the regulators as well.

     

    These were the major points of discussion at the 2nd Legal Era Media & Entertainment Law Forum, where legal counsels for various broadcasters, emphasised on how the regulatory regime in India is very backward. A normal broadcaster today has to go through the tedious task of applying to the Ministry of Information and Technology (MIB), Department of Space (DoS) and WPC approvals. As per statistics, at present approximately 800 files for channel licence is pending with the MIB and some 600 with the DoS.

     

    Stressing on the rise of technology, Zee Entertainment Enterprises Limited (Zeel) director corporate Amitabh Kumar said that by the year 2020 linear transmission of channels will be replaced by video on demand (VoD). Kumar also stressed on the need for change in the way licences are given to broadcasters. “The broadcasters’ licence should have provision for VoD, VOIP etc. There should also be a provision, as per which the licence services should be allowed to expand, with no entry fee. The regulatory body must have scope for widening the ambit of services for lifetime,” opined Kumar.

     

    For Kumar, the regulators need to be pro-active rather than reactive to the new technology advancements.

     

    Content consumption is undergoing change. “Content cannot be controlled, it can be self regulated, which is working beautifully,” informed Viacom 18 Media group general counsel Sujeet Jain. He also brought to the fore how the functioning of Broadcast Content Complaints Council (BCCC) had forced even the I&B to retract from interfering in the content. “Government should completely take its hands off content,” he added.

     

    Agreeing with Jain was Singh and Singh Law Firm LLP partner Tejveer Bhatia who said that tariff of the VoD content should not be regulated. “If consumer is demanding a particular kind of content, the media industry should have the freedom to decide the tariff. There cannot be a benchmark on the demanded content,” informed Bhatia.

     

    According to Star India president and general counsel, legal and regulatory affairs Deepak Jacob the quality of content is directly proportional to the money spent on it. “If we want to produce high quality content for linear TV, there is cost that is attached to it. While in the past 15 years, the ARPUs have remained flat at Rs 150 to Rs 200 and the broadcasters’ fair share of this has also remained the same, the content cost has increased 20 times. So Rs 1 lakh per episode expense, 15 years ago, has today gone up to Rs 15 lakh to Rs 20 lakh per episode,” informed Jacob.

     

    Jacob also questioned the whole ‘must provide’ clause that was introduced by the Telecom Regulatory Authority of India (TRAI). “All this will kill broadcasters. What is the incentive that a broadcaster is getting for creating content for mobile devices or other platforms?” questions Jacob.

     

    Another important point raised during the panel discussion was that unlike in the US and UK, where channels are sold as events, in India, this arrangement doesn’t exist. “We should be moving towards a regime, where consumers can subscribe to events and not channels. And the subscription should allow one to view the content not only on TV but mobile, tablet or computer also. Content, not channel should be highlighted and consumers should be able to pay for content,” said Kumar.

     

    According to Jain, while with change in technology, the format and consumption pattern of the content will change, but the content will remain the same.  “The regulation has to incorporate this aspect and there should be a level playing field,” he opined.

     

    The panelists also suggested that a lot of licencing should go away and what the government should really look at, while moving towards convergence is providing ease of access. “The Prime Minister is talking about making broadband available across the country, but for this access will be needed,” said Jain.  He also highlighted the need for strict laws against piracy. “Taxation needs to be rationalised in order to give fillip to the sector. That apart, ministries will have to merge so that entire ecosystem can merge,” opined Jain.

     

    The session also touched upon the issue of carriage fees and if there was any end to it. According to Jacob, while carriage fee, which is an artificially created monster needs to vanish, placement fee is something which will not cease to exist. “Placement is an individual choice that broadcasters make. It will be unfair of broadcasters to expect a certain number of LCN, without incentivising the MSO,” he concluded. 

  • There is a need for uniform tax regime in the country: Siddharth Roy Kapur

    There is a need for uniform tax regime in the country: Siddharth Roy Kapur

    MUMBAI: A country, which is considered filmy, with the kind of movies produced and the impact it has on the people, still faces numerous challenges. And one of this is the lack of cinema screens.

     

    In a panel discussion at the 2nd Media & Entertainment Law Forum 2014 conducted by Legal Era, Walt Disney India MD Siddharth Roy Kapur stressed on how even with a population of 1.2 billion, there are only 13 screens for every one million people. “In fact, 3 Idiots, the greatest hit and revenue generator so far reached out to only 3 per cent of the entire Indian population, in terms of screens. All the others saw it on TV,” informed Kapur.

     

    M&E industry contributes 0.5 per cent of the overall GDP of the country, of which movies is a Rs 12,000 crore business. Theatrical release, satellite rights, international rights and digital screening are all different models of revenue streams for the industry currently.

     

    “We have so far not represented ourselves in a way that we should have to the government. We need to work with the government so that they know how well we can contribute to the economy of the country. It is only then that they will understand our challenges,” added Kapur.

     

    According to Kapur, infrastructure, piracy, regulation and creativity if galvanised in the right direction can take the movie industry forward.  “There is not much regulation on the piracy front as well,” he said.  

     

    The country also needs to invest in talent to ensure creativity. “Apart from that, of course we need good movies. The industry has to focus on writing and paying more to the writers. We need to move out of the south Asian diaspora and cater to a wider audience world over,” he opined.

     

    An interesting point that came out during the panel discussion was the fact that regional movies contribute to 40 per cent of the total revenue the industry generates. “Mostly it comes from the Tamil and Telugu movies,” informed Reliance Big Films CFO Shibasish Sarkar.

     

    Addressing the growth of regional movies, Kapur said that though these are important markets their sensibilities are different. “So it is better to ally with local partners, in terms of directors or producers at least for a couple of initial movies and then get your hands dirty. We do one Tamil movie a year now,” he informed.

     

    Talking on the investment in movies, Sarkar said that any investor today looks at risk return ration before investing in a project. “Unfortunately, we have not yet been able to create an environment such that the investors can be made to feel confident of their investments,” he added.

     

    What’s more, even with popularity of Bollywood world over and 100 per cent FDI, none of that money comes to India. “There is no venture capital environment here,” said Cinema Capital Advisory managing director and founder Samir Gupta.

     

    Investors, according to Gupta, look for incentivised markets and so the government should be working at giving more incentives, if not at the central level, but at the state level. “There should be a legal framework for states, which can help them grow,” he said.

     

    India is a tough market for animation movies, feels Kapur. “Audiences are used to watching animated content on TV for free, and so it is very difficult to get them to buy a movie ticket worth Rs 300 for an animated movie.” Another reason why animation movies have not grown in the country, Kapur opines that it lies in the fact that Indian filmmakers are not good storytellers when it comes to animation.

     

    The panel also felt that there is a need for a uniform tax situation in the country. “Overall Goods and Services Tax (GST) is definitely a positive,” said Kapur. According to the panelists, in a uniform GST regime, entertainment tax will get subsumed into it, and this will be a complete game changer.