ITV

Category: Special Report

  • Road fraught with political & bureaucratic potholes for new MIB secy

    Road fraught with political & bureaucratic potholes for new MIB secy

    For a person taking charge as the head of bureaucracy in any Ministry, perhaps the biggest challenge is to put aside his or her own personal views and get down to translating the decisions of the Government and the Minister into action.

     

    However, this becomes even more onerous when there are tasks that have to be accomplished within just a few months.

     

    For senior Indian Administrative Services (IAS) officer Sunil Arora, who is slated to take over as secretary in the Ministry of Information and Broadcasting (MIB) from 1 September, the first major task looming over him is Phase III of the Digital Addressable System (DAS) for Cable TV, which has to be accomplished within four months. 

     

    Arora is an IAS officer from the Rajasthan cadre of the 1980 batch. His immediate predecessor – Bimal Julka belongs to the 1979 batch from Madhya Pradesh. Julka took over his post in the MIB in July 2013 when Uday Kumar Varma retired.

     

    DAS PHASE III

     

    Even though the present government changed the deadlines for the last two phases of DAS, the stakeholders do not appear to be ready for it. There is still a dire shortage of compatible set top boxes (STBS), and there has been little headway despite the incentives offered under the Make in India scheme. Even at present, a large number of local cable operators (LCOs) are having to work with poor quality STBs made in China or other countries. 

     

    Added to that is the fact that a large number of broadcasters, multi system operators (MSOs), and LCOs still have to work out their agreements – an issue further complicated by the directives of the Telecom Disputes Settlement and Arbitration Tribunal (TDSAT), which wants a re-look at the tariffs.

     

    It is also a fact that analogue transmission continues in many parts of cities and towns that have gone digital and the Government has failed to get the stay of DAS in Chennai vacated. 

     

    TRAI

     

    Although these are issues that the Telecom Regulatory Authority of India (TRAI) is dealing with, all decisions relating to the broadcasting sector can only be effective if there is proper coordination between the regulator and the Ministry. This effectively means there has to be a quick response to any issues that either parties raise to the other, if deadlines have to be met.

     

    Other issues pending before TRAI relating to broadcasting include the need to reconsider the foreign direct investment (FDI) norms for media, shortage of spectrum, a growing demand by states seeking permissions to start their own television channels despite the TRAI having opined against it twice since 2008. 

     

    Although broadcasting duties were handed over to TRAI just over a decade back, it is also clear that the Ministry will have to consider whether there is need to form a broadcasting-specific body as TRAI is primarily a body set up for the telecom sector. If the Government decides to continue with TRAI handling both portfolios, the Regulator will be under pressure from the MIB to strengthen its broadcasting team and also ensure greater coordination among officers in both broadcasting and telecom.    

     

    With convergence of technologies becoming a reality, and with issues of spectrum already bringing telecom and broadcasting together, the National Democratic Alliance (NDA) Government has again begun to talk about convergence and this is bound to gather pace over the next two years.

     

    SPECTRUM

     

    Though the Defence Ministry has in principle agreed to hand over some spectrum and swap some other spectrum, the whole process is caught up in bureaucratic wrangles. If the Ministry wants to continue with its policy of ensuring there are no caps on the number of television and FM radio channels or direct-to-home (DTH) and Headend in the Sky (HITS) platforms in the country, the issue of spectrum will need early solution. 

     

    FM RADIO AUCTION

     

    The Government is in the midst of the FM Radio e-auction, and is committed to continue the process till all slots in the first stage of Phase III – of 69 cities, which already have FM channels – are completed. With at least 13 cities failing to get even a single bid, the new secretary may have to find ways of either lowering the reserve price for those cities or move those cities to the next stage. 

     

    The fact that the cumulative winnings from the channels auctioned so far has exceeded the reserve price by more 100 per cent is undoubtedly a matter of great satisfaction, but some cities failing to attract bidders remains to be an irritant.

     

    AD CAP

     

    The matter of enforcing the advertising cap of 12 minutes an hour is already before the Courts, but the Ministry may have to do a rethink in the light of the I&B Minister Arun Jaitley having said that he was opposed to ad caps on the print or electronic media, and because the free-to-air channels (most of which are news channels) have already expressed their opposition to this. TRAI had failed to get permission to take action against television channels violating its diktat of the total of 12 minutes of commercial and promotional advertisements every hour, though all broadcasters were asked to keep records of this by the Delhi High Court. 

     

    SPREAD OF FM RADIO vs DRM

     

    Even as All India Radio (AIR) has spent crores of rupees on the digitised Digital Radio Mondiale (DRM), Prasar Bharati feels that Frequency Modulation (FM), which is an analogue technology should be promoted until the nation is ready for digital radio sets. The Ministry can resolve this issue only if it can ensure adequate manufacturing at affordable process of DRM sets under the Make in India programme. Until then, this continues to be a thorn in the already dicey relations between the public service broadcaster and the Ministry.

     

    COMMUNITY RADIO

     

    More than a decade has elapsed since the introduction of community radio, but the number of operational stations still remain very low. To boost this sector, the Government introduced a new scheme last year for funding community radio, but bureaucratic wrangles continue to hold up the smooth implementation of this scheme. 

     

    PRASAR BHARATI & THE MINISTRY

     

    On paper, as per the Prasar Bharati (Broadcasting Corporation of India) Act 1990, it is clear that the pubcaster is autonomous. However, in reality this appears quite contrary.

     

    On the one hand, as a measure to help the pubcaster, a Group of Ministers had decided that persons employed as on 5 October, 2007 will get the salary and pension from Government funds. However, for employees who joined after that date, Prasar Bharati was left to fend for itself.  

     

    Since Prasar Bharati is listed as an autonomous company under the Ministry, this means – and it appears so even from the manner in which questions relating to the pubcaster are answered in Parliament – that there is dispute on what real autonomy is.

     

    Prasar Bharati CEO Jawhar Sircar – a former bureaucrat himself – feels the government does not given him full freedom and there is interference at every level and has said so either in speeches in articles by him or others in the pubcaster.

     

    While there is generally full autonomy as far as content goes, there are allegedly checks and balances placed by the government in administrative matters. 

     

    Journalists on the Parliamentary beat are often flabbergasted by the fact that when it suits the Government, a reply will say that the pubcaster is an autonomous body, and yet there are times when the Government has intervened even in appointments in Prasar Bharati.

     

    FOREIGN DIRECT INVESTMENT

     

    The TRAI had given its recommendations for an increased FDI in many sectors of the media in a report in July 2013. Although there was some change by the Government earlier this year, it has still not implemented the FDI report of TRAI in full.  

     

    SECURITY CLEARANCE

     

    While the Home Ministry has decided it is doing away with security clearance for MSOs, it has not taken a decision as far television channels are concerned. While the issue relating to foreign ownership can be understood, the denial of security clearance to Sun TV continues to flummox everyone in the media.

     

    It is generally felt that an accused is not guilty till proven, but the Home Ministry and the MIB appear to have decided that the Maran brothers should be denied security clearance despite the fact that the cases against them have no relation to the security of the country, and are in fact an incursion on the freedom of the media. Even the Supreme Court while permitting Sun Group companies to take part in the FM auction said so.

      

    PAID NEWS

     

    It is now almost five years since the issue of paid news became the talk of the town. The Press Council of India set up a committee, which even gave recommendations, and a Parliamentary Panel along the Election Commission also wanted some steps to be taken to stop this. However, there has been no tangible action so far in this matter.

     

    FILM INDUSTRY

     

    The film industry has been raising similar issues year after year. As far as taxation issues were concerned, it was hoped that the Goods and Services Tax (GST), when implemented will help. But the way the matter is stuck in Parliament forces the industry to just wait and watch.

     

    Entertainment tax is another issue on which there has been no unanimity and states have different taxes. About a decade earlier a proposal for bringing cinema into the Concurrent List of the Constitution might have solved the problem, but most states opposed the idea. 

     

    In a country producing around 1000 feature films every year, apart from the large number of films from overseas, India still suffers from an acute shortage of theatres, with the number less than 11,000. With the high rates of ticketing charged by the multiplexes, the average cinegoer is denied the pleasure of seeing a film in a cinema hall. 

     

    All attempts to curb video piracy appear to have failed because the film industry and the government have failed to work together to curb the menace. This in turn means huge losses for the makers of bold films unless there are big stars to lure the audiences.

     

    The Film Museum has been in the planning and making for more than a decade, but it does not appear that the Museum planned for 2013 to coincide with a centenary of cinema will see the light of day for at least a couple more years.

     

    The Film and Television Institute of India (FTII) has been caught in a logjam that just refuses to untangle. The appointment of a Chairperson, who was said to be close to the ruling party, is what triggered the issue, but the continued struggle has led to the police making an entry into the campus in Pune. 

     

    Clearly, the new MIB secretary has his job cut out for him and will have to tread carefully on the long road ahead – but it is not without political or bureaucratic potholes that can hold up even his best intentions.

     

  • Q1-2016: Cable TV in India – Sequential quarter revenues down, broadband shines

    Q1-2016: Cable TV in India – Sequential quarter revenues down, broadband shines

    Indian Cable TV is a long haul work-in-progress is what we had said last quarter. The results of the four sample companies in the quarter ended 30 June, 2015 (Q1-2016) in that report seem to endorse this fact. All four companies comprising the big three – Hathway Cable and Datacom Limited, Den Networks Ltd, Siti Cable Network Limited and the minnow – Ortel Communication Limited reported a quarter on quarter (QoQ) drop in total income from operations (TIO or revenue) in the current quarter. As expected, broadband subscribers and revenue continues to grow.

    Note: (1) 100,00,000 = 100 lakh = 10 million = 1 crore.

    (2) Some figures are approximate.

    (3) Generally other income has not been factored in for EBIDTA figures in the report.

    Performance

    Though Den Networks’ and Hathway’s YoY results in the current quarter deteriorated, QoQ, both performed better, albeit both the cable companies reported losses. Siti Cable’s loss in Q1-2016 increased YoY and QoQ, and though regional player Ortel returned a profit in the current quarter as compared to a loss in Q1-2015, its Q1-2016 profit was less than half the profit reported in the immediate trailing quarter.

    Over the last few quarters, Den Networks’ financial performance has shown a marked decline. From a company that reported profit after taxes, it has started reporting a loss. Without considering other income, the company reported a negative EBIDTA of Rs 4.67 crore as compared to the operating profit of Rs 57.16 crore in Q1-2015 and a higher operating loss of Rs 5.97 crore in the immediate trailing quarter. However, the company’s Cable TV segment reported a higher QoQ EBIDTA in Q1-2016 of Rs 18 crore (6.9 per cent margin) as compared to the Rs 14 crore (5.3 per cent margin) in Q4-2015, but a lot lower than the EBIDTA of Rs 69 crore (27 per cent margin) in Q1-2015.

    Hathway’s EBIDTA in the current quarter declined 25.4 per cent to Rs 32.73 crore (12.8 per cent margin) as compared to the Rs 43.87 crore (17.5 per cent margin) in the corresponding year ago quarter but was 5.7 per cent more than the Rs 30.98 crore (11.5 per cent margin) in the immediate trailing quarter.

    Siti Cable’s EBIDTA including other income for Q1-2016 increased 5.1 per cent to Rs 38.1 crore as compared to the Rs 36.26 crore in Q1-2015 and was 18.7 per cent more than the Rs 32.11 crore in Q4-2015.

    “Our commitment to improving operational efficiency and streamlining operations continues, leading to EBITDA growth of 18.7 per cent and margin expansion by 501 bps QoQ,” explains Siti Cable executive director and CEO VD Wadhwa.

    Ortel’s EBIDTA in the current quarter improved by 24.1 per cent to Rs 10.84 crore (26.7 per cent margin) as compared to the Rs 8.73 crore (22.1 per cent margin) in Q1-2015, but declined 34.5 per cent as compared to the Rs 16.55 crore (36.9 per cent margin) in the immediate trailing quarter.

    Ortel president and CEO Bibhu Prasad Rath said, “Overall growth was delivered on the back of steady contribution from Cable TV and Broadband segments supported by continued momentum in the Infrastructure Leasing segment. Significant growth in subscriber base, deeper penetration, enhanced product offerings and a strong team, should enable us to notably improve our performance going forward.”

    Total Income from Operations

    Please refer to the figure below. Den Networks, the company with the largest TIO among the four, reported TIO at Rs 265.60 crore, 11.1 per cent less than the Rs 298.81 crore in Q1-2015 and 1.7 per cent lower than the Rs 270.30 crore in Q4-2015. The company’s loss in the current quarter at Rs 51.89 crore was lower than the Rs 61.15 crore reported in the immediate trailing quarter Q4-2015. The company had posted a profit of Rs 1.12 crore (0.4 per cent margin) in the corresponding year ago quarter – Q1-2015.

    Though Hathway reported 5.7 per cent growth in standalone TIO in Q1-2016 to Rs 264,41 from Rs 250.11 crore in Q1-2015 QoQ, its TIO was 2.1 per cent lower than the Rs 270.03 crore in Q4-2015. Hathway’s loss in the current quarter widened to Rs 43.91 crore as compared to the Rs 0.93 crore in Q1-2015, but was considerably lower than the Rs 76.99 crore in Q4-2015.

    Siti Cable reported TIO of Rs 228.09 crore in Q1-2016, which was 9.1 per cent higher than the Rs 209.02 crore in Q1-2015, but was 10.9 per cent lower QoQ than the Rs 256.01 crore in Q4-2015. The company reported a higher loss of Rs 37.11 crore in Q1-2016 as compared to the loss of Rs 31.67 crore and a loss of Rs 34.13 crore in Q4-2015.

    Ortel reported 20.5 per cent growth in TIO at Rs 40.60 crore in Q1-2016 as compared to the Rs 33.69 crore in Q1-2015, but 9.6 per cent lower than the Rs 44.91 crore in Q4-2015. Ortel reported profit after tax (PAT) of Rs 2.44 crore (six per cent margin) as compared to a loss of Rs 1.16 crore in the corresponding year ago quarter, but Q1-2016 PAT was less than half (lower by 56.8 per cent) the PAT of Rs 5.65 crore (12.6 per cent margin) in the immediate trailing quarter.

    Cable TV (Video) Subscription Revenue

    Subscription revenue in the current quarter dropped QoQ in the case of Siti Cable and Hathway, while both Den Network and Ortel saw an increase in YoY and QoQ subscription revenue. At the same time, all the companies have reported higher digitisation numbers in DAS and non-DAS areas. Siti Cable and Ortel have reported a gain in subscription numbers as well. While Den Networks and Hathway have reported flat or slightly higher digital as well as analogue average revenue per user (ARPU), Ortel has reported a slight drop in both ARPUs. 

    According to company sources, Siti Cable, which is the biggest player among the four sample companies in terms of cable TV subscription revenue, had flat QoQ ARPUs in Q1-2016, while YoY ARPUs showed double digit growth. The company claims that its subscriber base has increased by two lakh (all digital) to 107 lakh as it expanded its footprint by entering into 12 new towns across India as a part of the ongoing voluntary digitization process in order to be compliant with the DAS phase III digitisation deadline.

    Despite the flat QoQ ARPUs and higher subscription numbers, Siti Cable’s cable TV subscription revenue fell QoQ because the company had initiated strict measures against erring LCOs and had switched off signals to the extent of about four lakh cable TV consumers, as per industry sources.

    “During the quarter, we have further tightened our credit control measures and started taking strict actions against defaulting operators, which shall result into improved credit discipline and saving in operating cost,” revealed Wadhwa. A source told Indiantelevision.com that Siti Cable’s strict measures seem to have worked and signals have been resumed to the subscribers, but that it would take time to reflect the improved numbers in its financials.

    Ortel’s Rath added, “I am also pleased to share that over and above the 542,217 RGUs (revenue generating users) as on 30 June, 2015, we have signed buy out agreements with multiple LCOs with total estimated RGUs of 33,000, which would be integrated into Ortel’s last mile network going forward. So we remain on track and are confident of achieving our target of one million RGUs by March 2017 backed by our LCO buy out strategy and focus on organic growth both in broadband and cable TV.”

    Pay channel Costs

    Please refer to the figure below that represents the Cable TV costs paid by the four sample companies. 

    The big three reported a QoQ fall in pay channel costs, while in the case of Ortel, pay channel costs rose. This does not mean that a la carte has become a reality and the multi-system operators (MSOs) are only paying for what their subscribers are paying. It’s just that this quarter, balancing amounts have been paid to a broadcast aggregator, since excess payments had been made until Q4-2015. 

    Diverting from the performance for a bit, a source from an MSO says, “As a matter of fact, it’s the big broadcasters that are resisting a la carte. A la carte will affect their overall advertisement revenues for packaged deals across the multiple channels within their fold.”

    Internet subscription revenue

    This is one avenue that most cable companies are looking at as their business and revenue growth alternative. Internet ARPUs in India are much higher – to the extent of 3 to10 times the ARPUs from cable television. All the four sample players in this article reported YoY growth. The big three- Hathway, Den and Siti Cable also reported QoQ revenue growth, while Ortel’s internet subscription revenue remained flat. Higher subscription numbers, higher ARPUs brought in the accelerated revenue growth for Hathway, Den and Siti Cable. Typically, broadband ARPUs for the big three were in the range of Rs 750 in Q1-2016 as Rs against 650-700 in Q1-2015 and Rs 720-750 in the previous quarter.

    Among the four, Hathway with an initial higher internet subscriber base in excess of four lakh plus, reported a growth of 50,000 subscribers to bring its total subscriber numbers to 4.6 lakh in Q1-2016. Already its internet revenue subscription has a reasonably big share in its overall revenue pie. Comparatively, the other three have internet subscribers than number in just tens of thousands, though all have reported reasonable YoY and QoQ growth in subscribers.

    Ortel reported a slight depletion in ARPUs and hence the flat internet subscription revenue despite a higher QoQ subscriber base. Ortel’s broadband RGUs in the current quarter grew 4.1 per cent to 60,900 from 58,519 in Q4-2015. Ortel also launched up to 50 Mbps DOCSIS 3.0 Broadband Internet in Odisha. The company’s broadband ARPUs in the current quarter also declined by Re 1 to Rs 393 from Rs 394 in Q4-2015.

    End Points

    At present, most MSOs have two separate arrangements with broadcasters – one for Digital Addressable System (DAS) areas and another for non DAS areas. Recently the Essel Group that operates both carriage platforms – DTH though Dish TV as well cable TV through Siti Cable – formed a common entity called “COMNET” to help synergize strengths of both entities in dealing with broadcasters. Siti Cable says that the primary reason for forming this venture was to ensure that consumers have access to quality content at affordable prices. This move would assist in keeping content cost in consonance with consumer ARPUs and market realities. 

    Players across mature markets such as the US continue to report a fall in video subscribers – to that extent that most companies there have higher broadband subscribers than video subscribers. Such a scenario is not probable in the near future in India, but cable TV players do face competition from wireless internet players and mobile companies as well as from other devices as a mode of entertainment rather than the idiot box. Carriage or placement fees could continue as bargaining currency in the near future.

    Once a la carte becomes a reality, to some extent, one could infer that if the pay channel costs are down, it’s because subscribers have used the option, and not that the player has lost more subscribers than it gained. In theory, DAS has made it possible for carriers to pay broadcasters if and when the subscriber subscribes for pay channels. It now remains to be seen if the players in the industry allow the theory to be put into practice. Cable TV subscription revenues and ARPUs could fall if players don’t play it right.

    The response to the Hinduja’s HITS (headends in the sky) platform from local cable operators (LCOs) has been tremendous, if one were to go by initial reports. The DTH industry has started making inroads into DAS phase III and IV areas and could grab more than the 30 to 40 per cent of the subscribers that it did in phase I and phase II.

    As has been pointed out by industry experts, just the seeding of set top boxes (often non-BIS compliant STBs) does not mean implementation of DAS as it was truly meant to be. It can be safely reiterated that there’s a lot of work to be done by the industry.

  • TV channels unleash slew of special programming for Independence Day

    TV channels unleash slew of special programming for Independence Day

    The entire nation will be waiting to hear Prime Minister Narendra Modi’s Independence Day speech from the historic Red Fort. The country paralysed by deadlock in the Parliament due to constant protest from opposition, will be desperately listening to the PM’s verses via different news channels, radio and other mediums.

     

    While ‘One Rank One Pension’ is already trending on social media, various gallantry awards are also scheduled to be distributed, this Independence Day.

     

    The Independence Day celebrations will not just be restricted to the political class as numerous channels are set to roll out special programming for their viewers. The programming mix on the occasion of India’s 69th Independence Day across television channels of various genres is as follows: 

     

    English News Channels

     

    ET Now

     

    The ET Now special coverage will have half an hour interview with Godrej Industries chairman Adi Godrej. Sandeep Gurumurthi will interview Godrej at 5.30 pm on 15 August. The channel will also relay Prime Minister’s speech in the morning. Live panel discussion on Modi’s ideas with panelists and big voices from the corporate world will also be in the list of special programming of Independence Day from 12 – 12.30 pm and 9 – 10 pm.

     

    India Today Television

     

    Women are going to be at the forefront of India Today Television’s Independence day programming, with topics like ‘Are women as independent as men?’ ‘Chak De Girls – On the Indian Women’s Hockey Team’ and Rajdeep Sardesai with the ‘Unsung Heroes’.

     

    In addition, the channel will also be airing ‘The Greatest Story Ever Told – 40 Years Of Sholay’, ‘I Am Sania’ – Sania Special Context – Getting The Khel Ratna as well as Sumitra Mahajan’s interview with Karan Thapar.

     

    Times Now

     

    Times Nows’ Independence Day coverage will begin with the live coverage of Modi’s speech followed by a special one hour independence day show of TotaI Recall. Stories and vignettes from across India on how Independence day was celebrated will be aired through the day.

     

    English Entertainment & Movies

     

    AXN India

     

    This Independence Day, Jack Bauer will battle and abolish crime with the iconic television series 24 Live Another Day on 15 – 16 August from 12 – 5 pm on AXN India.

     

    Disney

     

    Disney will be bringing in two beloved characters, Captain Tiao and Nikki (from Best of Luck Nikki) to share the meaning of Independence Day and showcase how will they be spending the day this year.

     

    HBO Defined

     

    HBO Defined gears up to celebrate the I-Day weekend with a line-up of movies, which will be 100 per cent ad-free. Beginning 15 August, 10 am onwards, the channel will showcaseThe Hunger Games: Catching Fire, Ender’s Game, Noah, I, Frankenstein, Gravity andNow You See Me.

     

    “We invite our audience to celebrate the spirit of freedom with their favorite movies on HBO Premium channel, HBO Defined, this Independence Day by not just offering exceptional titles but also presenting them with a completely memorable uninterrupted viewing experience,” said HBO marketing and business development director Shonali Bedi.

     

    Movies Now

     

    The channel will air a day long salute to the bravery with stories of ordinary people who display extraordinary courage to break free from constraints imposed them. The lineup features tittles like Avatar, Life of Pi, Harry Potter & The Deathly Hallows Part 2 and The Dark Knight Rises.

     

    MN+

     

    MN+ will give viewers an in-depth look into the story that shook the world. The line-up features two back to back movies on whistleblower Julian Assange.

     

    Underground: The Julian Assange Story and Steal Secrets: The story of Wikileaks will feature on MN+ as special programming for Independence Day.

     

    Speaking on the programming, Times Network English Entertainment cluster SVP and head Vivek Srivastava said, “For this Independence Day, our theme is saluting and celebrating bravery and the indomitable human spirit. We have stories of ordinary people who display extraordinary courage to break free from constraints imposed on them. On Movies Now, we are screening ‘Fight for Freedom’ from 9 am onwards.”

     

    “Under classifiled section, we will air the popular film – Underground: The Julian Assange Story followed by We Steal Secrets, the story of Wikileaks on MN+. The story emerges the details how a hacker transformed himself to a world saving whistleblower against the worldwide socio-economic and socio-political injustice. It is about freedom of press, speech and rights. By screening these films, we at MN+ and Movies Now want to celebrate the spirit of humanism and the eternal will of our race to stand upright,” he added.

     

    Sony Pix

     

    Exciting series of Indiana Jones based on adventures and mystery of Dr. Henry ‘Indiana’ Jones, a fictional archaeologist by none other than the legendary George Lucas will be Sony Pix’s offering for Indians on Independence Day.

     

    The programming will start with the search for the Ark of the Covenant in the movie The Raiders of the Lost Ark, which will be aired at 11 am. Indiana Jones will take viewers on his classic trilogy ride with The Last Crusade at 1.30 pm, followed by The Kingdom of the Crystal Skull at 4.30 pm.

     

    Star Movies Select HD

     

    Star Movies Select HD – the channel, which has committed to showcasing fresh stories every day of the year, will premier Wes Anderson’s cinematic masterpiece, The Grand Budapest Hotel on the occasion of India’s 69th Independence day. The channel will premier the movie at 9 pm on 15 August.

     

    VH1

     

    This 15 August at 9 am and 10 pm, Vh1 will liberate viewers from the shackles of doubt with Vh1 Artist Select: Independence Day Special. Indian artists will reveal what’s playing on their playlist. From knowing that the B.L.O.T boys love hip hop and to knowing what Dualist Inquiry listens to on their playlist, the channel will give viewers complete dope on Indian artists’ favorite tunes.

     

    Hindi Entertainment & Movies

     

    &TV

     

    For Independence Day, &TV will air four special promos through the day. In addition to that, a special end page carrying Independence Day wishes has been created across all promos on air on 15 August. The logo will also carry Independence Day wishes through the day.

     

    Colors

     

    On 15 August at 8:30 pm, actor Nawazuddin Siddiqui will be seen promoting his upcoming film Manjhi on Colors’ show Udaan. He will be seen partaking in the flag-hoisting ceremony and deliver a speech on inspiration and hope leading to freedom.

     

    Jhalak Dikhhla Jaa Reloaded at 9 pm will have a special Independence Day show with the contestants showcasing performances themed around independence and freedom. Most contestants have designed their performances around Indian dance forms.

     

    Epic

     

    The Epic Channel is all set to celebrate the spirit of patriotism this Independence Day by airing back-to-back episodes from the recently launched show Stories by Rabindranath Tagore directed by Anurag Basu. The Independence Day special on 15 August will be aired from 12 – 9 pm.

     

    Sony

    Sony Entertainment Television will premiere the blockbuster Piku starring Amitabh Bachchan, Deepika Padukone and Irrfan Khan at 8 pm. The movie will be followed by a special episode of the show Crime Patrol.

     

    Sony Max & Max 2

     

    The combination of Sony Max and Max 2 brings to its viewers a formidable line-up of patriotic movies on the occasion of Independence Day. With movies such as Indian, Chak! De India, Purab Aur Paschim and Kranti, viewers will be privy to an entire day of enjoyable movie watching experience.

     

    Max and Max 2 senior executive vice president and business head Neeraj Vyas said, “To commemorate the nation’s independence, we thought of showcasing films on both channels that are evocative of the struggle and triumph of victory in different realms of life and through different eras. With our endeavour to constantly provide our viewers with the best films, we hope to arouse a feeling of patriotism with an engrossing bouquet of films on both channels.”

     

    Note: The channels are listed in Alphabetical order.

  • FY-2015: Radio industry numbers the best as yet?

    FY-2015: Radio industry numbers the best as yet?

    Has the Indian radio industry put in its best performance as yet? Preliminary conclusions based on the results filed by a few of the listed and segments of listed companies seem to indicate so, as do extrapolations of data from the Telecom Regulatory Authority of India (TRAI) that is as yet available until Q3-2015.

    Note (1): (a)100,00,000 = 100 lakh = 10 million = 1 crore

    (b) The author has taken the liberty to introduce two new measures – average revenue per radio station and average operating profit per station. These are rough yardsticks and may not necessarily be indicative of a station or a network’s performance, because factors such as geography and market conditions within the area of operations are among many other factors that will also determine performance.

    CAGR since FY-2012 is likely to be between 11 and 12%: TRAI data

    As per data from TRAI, radio advertisement revenue has been increasing every quarter. Please refer to Fig A below, which shows ad revenue for a 15 quarter period starting Q1-2012 (quarter ended 30 June, 2012) until Q3-2015 (quarter ended 31 December, 2014). Ad revenue of Rs 450.95 crore for Q4-2015 has been calculated using the average percentage increase between Q3 and Q4 over three years (FY-2012, FY-2013 and FY-2014) – this works out to 1.76 per cent.

    Ad revenue of Rs 487.34 crore for Q4-2015 (quarter ended 31 March, 2015) is the projected revenue by the linear trend line in Fig A-1, which is based on the revenue of the first three quarters of FY-2015. This shows a growth of 19.75 per cent over FY-2014. This figure is quite close to the average (simple) revenue growth of 19.93 per cent by the six sample companies whose figures have been considered later in this report. (At the time of filing this report, TRAI had not released data for Q4-2015. It must also be pointed out that TRAI has been releasing ad revenue data for lesser than the licensed number of radio stations, as indicated in the second line of the X axis in Fig A below.)

    The trend line in Fig A indicates that ad revenue is increasing linearly. The figure also indicates that the radio industry has had its lowest quarter in terms of ad revenue in Q1, progressively increasing in Q2 and Q3, with the highest ad revenue in Q4 in FY-2012 and FY-2013. There could be various reasons for this and some that come to mind are that Q4 is the fag end of the financial year and advertisers use this very local medium to push through sales and attain year end targets for better margins. It could also mean that some advertisers already consumed a major portion of their ad budgets and are using the low cost alternative for grabbing consumer attention. However, in FY-2014, Q4-2014 ad revenue was lower than Q3-2014 by 1.02 per cent. Assuming the same trend is followed this year too, the projected ad revenue for Q4-2015 works out to about Rs 438.63 crore.

     

    Based on the lower projected figure of Rs 438.63 crore, projected ad revenue for FY-2015 works out to Rs 1636.03 crore, and hence 16.29 per cent more than the Rs 1406.82 crore in FY-2014. Ad revenue in FY-2014 had grown 17.36 per cent from Rs 1198.77 crore in FY-2013. Since 2012, the industry’s ad revenue has shown a CAGR of 11 per cent if one were to consider the lower projected ad revenue of Rs 438.63 for Q4-2015.

    If we consider Q4-2015 ad revenue as Rs 450.95 crore indicated in Fig A above, revenue for FY-2015 is Rs 1648.35 crore and CAGR works out to 11.21 per cent between FY-2012 and projected FY-2015 ad revenue.

    If we consider the projected ad revenue for Q4-2015 as Rs 487.34 crore, then projected revenue for FY-2015 is Rs 1684.74 crore and CAGR between FY-2013 and FY-2015 (proj), works out to 11.82 per cent.

    As mentioned above, based on TRAI quarterly ad revenue data, total ad revenue works out to Rs 1406.82 crore for FY-2014 and the average ad revenue per station as Rs 5.92 crore for 237.5 stations. Please note that TRAI data for Q1-2014 and Q2-2014 was for 237 stations and for Q3-2014 and Q4-2015 for 238 stations and hence a not very accurate median of 237.5 stations has been used to calculate the average ad revenue per station for FY-2014 above. 

    Based on the projected ad revenues for FY-2015 of Rs 1636.03 crore, Rs 1648.35 crore, 1684.74 crore for 241 stations, the corresponding projected average ad revenues per station works out to Rs 6.79 crore, Rs 6.84 crore and Rs 6.99 crore respectively.

    Let us look at how a few radio groups performed:

    Note (2):  (a) This report considers PAT posted by two radio companies (ENIL – Radio Mirchi, 32 radio stations; Jagran Prakashan – Radio City – 20 radio stations)  and their operating results, along with operating results of DB Corp (My FM, 17 stations), B. A. G Films (Radio Dhamaal, 10 stations) and HT Media (Fever FM, 4 stations).

    (b) EBIDTA numbers for ENIL (Mirchi) have been calculated by adding the depreciation to the total income from operations and subtracting the total expense from the result, assuming that ENIL reports interest in finance charges separately.

    The numbers in the charts below cover just 89 FM broadcasting stations of six sample companies of the total of 241 or 36.93 per cent. 

    It is interesting to note that Radio Mirchi with just 32 stations (13.5 per cent of total number of stations of 237 in FY-2014 as per TRAI) contributed revenue of Rs 384.49 crore to a total ad revenue of Rs 1406.82 crore in FY-2015, or 24.77 per cent of total ad revenues of the industry, that is assuming that all of Radio Mirchi’s total income from operations is ad revenue.

    Another great performer, Music Broadcast Private Limited (MBPL, now a part of the Jagran Prakashan group), Radio City with 20 stations (or 8.44 per cent of the total number of stations in FY-2014 of 237 as per TRAI) reported revenue of Rs 160.53 crore or 11.41 per cent of the ad revenue for FY-2014 as per TRAI data, again assuming that all of Radio City’s total income from operations is ad revenue.

    Of course, some of these companies/segments also have revenue streams other than radio advertisement, for example, Radio Mirchi conducts the Mirchi Music Awards every year and must also be reporting sponsorship revenue, but considering that many, and especially Radio Mirchi, My FM, Radio City and Fever FM are parts of some of the biggest professionally-run media houses in the country, these entities will be able to leverage a reasonable amount of money from other streams. A few of the entities also have internet radio stations that have turned quite popular, more so among the Indian diaspora.

    Y-o-y, Q2-2015 was the best quarter in terms of revenue for five (except Radio City, whose numbers for Q1-2015 and Q2-2015 were not available at the time of writing of this report) of the six entities. Combined Q2-2015 revenue for the five entities was Rs 157.12 crore, 20.05 per cent more than the Rs 130.88 crore in Q2-2014. If one were to neglect the loss reported by Oye FM and Radio Dhamaal during the quarter, then the operating profit/PAT for My FM, Radio Mirchi (PAT) and Fever increased by 80.56 per cent as compared to the previous year.

    Income of the six entities

    Combined Operating Income of the six sample companies in this report grew 17.34 per cent in FY-2015 to Rs 886.05 crore from Rs 738.05 crore (52.46 per cent of the total ad revenue as per TRAI for FY-2014). As mentioned above, the simple average growth in revenue for the six companies was 19.93 per cent. Please refer to Fig B below.

    The highest growth was by BAG Films Radio Dhamaal with a revenue growth of 47.09 per cent in FY-2015 to Rs 7.48 crore (0.86 per cent of Operating Income of the six sample entities in this report in FY-2015) from Rs 5.09 crore (0.69 per cent of Operating Income of the six sample entities in this report in FY-2014). Oye FM grew the least – its operating income increased 0.64 per cent to Rs 15.48 crore (1.79 per cent of Operating Income of the six sample entities in this report in FY-2015) from Rs 15.38 crore (2.08 per cent of Operating Income of the six sample entities in this report in FY-2014). My FM, Radio Mirchi and Radio City showed double digit growth in operating income in FY-2015 of 20.68 per cent, 14.04 per cent and 30.42 per cent respectively, while Fever FM’s operating revenue grew 6.72 per cent in FY-2015 as compared to FY-2014.

    Operating Results -PAT and Margins of the six entities

    Combined Operating result – of the six entities – operating profit grew 33.07 per cent to Rs 260.43 crore in FY-2015 from Rs 195.71 crore in the previous year. Four of the six sample entities reported growth in operating profit in FY-2015 as compared to FY-2014, while the other two reported lower operating loss in the current year (FY-2015) as compared to the previous year.

    Please refer to Fig C and Fig C1 below.  Radio Mirchi’s operating profit in FY-2015 of Rs 145.34 crore (55.81 per cent of combined operating profit of six entities in FY-2015) was 16.59 per cent more than the Rs 124.66 crore (63.7 per cent of combined operating profit of six entities in F-2014). Its operating margin in FY-2015 improved marginally to 33.15 per cent from 32.42 per cent in the previous year. Radio Mirchi’s operating margin was the highest for both the years among the six entities considered in this report.

    Radio City’s operating profit in FY-2015 increased 52.3 per cent to Rs 64.86 crore (24.9 per cent of combined operating profit of six entities in F-2015) from Rs 42.60 crore (21.77 per cent of combined operating profit of six entities in FY-2014 FY-2014). Its operating margin improved to 30.98 per cent in FY-2015 as compared to the 26.54 per cent in the previous year.

    My FM reported a 51.89 per cent growth in operating profit to Rs 31.23 crore (11.99 per cent of operating profit-reported by the six sample entities in this report in FY-2015) from Rs 20.56 crore (10.51 per cent of operating profit-PAT reported by the six sample entities in this report in FY-2014). Its operating margin increased to 32.57 per cent from 25.88 per cent in FY-2014.

    Fever FM’s operating profit grew 37.07 per cent to Rs 29.21 crore (11.22 per cent of operating profit-PAT reported by the six sample entities in this report in FY-2015) from Rs 21.31 crore (10.89 per cent of operating profit-PAT reported by the six sample entities in this report in FY-2014). Its margin increased to 29.39 per cent from 22.88 per cent.

    It may be noted that ENIL (Radio Mirchi) reported profit after tax of Rs 105.97 crore (24.2 per cent of Total Income from Operations or TIO) in FY-2015, which was 26.99 per cent more than the Rs 83.45 crore (23.32 per cent of TIO) in the previous year. Further, Radio City also reported a doubling of PAT in FY-2015 to Rs 42.95 crore (20.51 per cent of TIO) from Rs 21.45 crore (13.36 per cent of TIO) in FY-2014.

    Results per station

    As mentioned above, these measures are rough yardsticks and may not necessarily portray a true picture of a station or a network’s performance.

    The average revenue per station for all the 89 radio stations of the six entities in this report grew to Rs 9.73 crore in FY-2015 from Rs 8.29 crore in the previous year. The average operating result per station based on EBIDTA for all the companies increased to Rs 2.93 crore in FY-2015 from Rs 2.20 crore in the previous year.

    Please refer to Table A below for details of the six entities. Fever FM reported the highest revenue per station in both FY-2015 and FY-2014 at Rs 24.84 crore and Rs 23.28 crore respectively. The next highest revenue per station was Radio Mirchi with 32 stations and revenue of Rs 13.70 crore and Rs 12.02 crore in FY-2015 and FY-2014 respectively.

    Radio City’s average revenue per station improved to Rs 10.47 crore in FY-2015 from Rs 8.03 crore in the previous year, when it was lower than the average revenue per station of the six entities in this report.

    Fever FM also reported the highest operating profit per station at Rs 7.30 crore in FY-2015 as compared to the Rs 5.33 crore per station in FY-2014. The next highest on this parameter was Radio Mirchi. On considering its standalone EBIDTA for FY-2015 at Rs 145.34 crore based on the numbers reported by the company on the bourses, Radio Mirchi’s average operating profit per radio station works out to Rs 4.54 crore. For FY-2014, Radio Mirchi EBIDTA was Rs 124.66 crore and its average operating profit per station was Rs 3.90 crore. Radio City’s average operating profit per station works out to Rs 3.24 crore in FY-2015 as compared to the Rs 2.13 crore in FY-2014.

    Conclusion

    As per the FICCI-KPMG Media and Entertainment 2015 report (FICCI M&E 2015 report), the radio industry saw a phenomenal growth of 17.6 per cent in 2014. The report pegs the radio industry size for 2014 in India at Rs 1720 crore (Rs 7.24 crore average revenue per station on a base of 237.5 stations). With the implementation of phase III, FM radio will reach 85 per cent of India’s territory, further adding the medium as an important part of advertisers’ plans because radio is likely to be a cheaper alternative due of its reach. More stations are also likely to result into stronger regional networks.

    Although, phase III auctions have been curtailed to just 135 stations in 69 cities and further delayed to the latter half of fiscal 2015, the industry feels that phase III could herald a new era for radio in India. 

    The FICCI M&E 2015 report says that growth in 2014 could be attributed to several reasons that include new upcoming sectors like e-commerce and industries such as real estate, retail and lifestyle products. As per the report many of the players reached 100 per cent inventory utilisation and hence hiked ad rates. There seems to a welcome change for the industry, which saw advertisers shift focus from nationwide brand building to more local focused promotional targeting, feeding on the strength of radio as a medium. Content innovation also contributed to the strong performance by many players. The general elections of 2014 also saw election spends finding its way to the radio industry with spends of around 12 to 15 per cent of ad budgets as opposed to the normal one to three per cent. Prime Minister Narendra Modi’s address to the nation on All India Radio through his show ‘Mann ki Baat’ has gained a lot of attention for the medium.

    Challenges continue to hound the industry with smaller and standalone stations feeling the pressure of rising cost structures, measurement and royalty fee issues and the rising threat of the digital media eating into the radio ad budget pie. The good news is that now advertisers see radio as an integral part of their media plans, not just an add-on expense head.

    So while FY-2015 is the best year yet for the radio industry so far, but the future is far brighter for the industry and its ecosystem, delays in phase III could dim the brightness, though.

  • Can the Indian cable television industry truly head the US cable television industry way?

    Can the Indian cable television industry truly head the US cable television industry way?

    People often tend to compare the cable television industry in India with that of the US. They say that the industry is headed the US way. One of the crucial points is internet service and more specifically broadband service. This business and revenue growth alternative has been gaining a lot of attention from the cable television industry as an expansion strategy. Higher Average Revenue Per User (ARPU) in India, to the extent of 3 to 5 times the ARPU earned through transmission of television bouquets, certainly makes this service an attractive proposition.

     

    Comparisons with a mature market like the US may not work in India. Indian cable television players have a long road ahead before any comparison or trying to relate with the industry, in any way could even start to make sense.

     

    One of the foremost factors is money. According to the National Cable and Television Association, USA (NCTA), the total US broadband industry investments since 1994 is about US$ 1400 billion (4.7 per cent of the US’s estimated revenue for 2014) or 60.7 per cent of India’s nominal GDP of US 2308 billion in April 2015. Money can bridge the technology gap, leapfrog it, as it has in many instances in India.

     

    Of course, this leads to the oft repeated point about the high cost of implementation of all DAS phases. It is a foregone fact that the capex starved cable television industry with poor balance sheets is going to deploy more money towards that effort if it wants the government to allow it to remain in business. Delays in deadlines may be possible, but in the current scenario, DAS is there to stay and is required for the benefit of all stakeholders.

     

    Notwithstanding the bureaucracy logjam that India is notorious for, another major stumbling block is the slow and hugely over vamped judicial system (besides regulation) in India that could take years to decide on any dispute. Settling of civil disputes has no deadline in India. The cliché, for businesses, ‘time is money’, holds good here too.

     

    Let us look at internet services

     

    The number of internet users worldwide will surpass 3 billion (300 crore) in 2015, according to eMarketer, increasing 6.2 per cent next year to reach 42.4 per cent of the entire world’s population. By 2018, eMarketer estimates, nearly half the world’s population, or 360 crore people, will access the internet at least once each month.  

     

    eMarketer says that by 2016 India will jump the US as the second-largest internet user population. China leads the world in terms of number of internet users with estimated 66.98 crore users, followed by the US with 25.93 crore and India with 24.23 crore say eMarketer estimates. In 2016, the publication estimates an Indian internet user base of 28.38 crore, higher than the 26.49 crore projections for the US. By 2018, India’s estimated internet subscriber base will be 34.63 crore or probably in the range of about 25-28 per cent of the population of the country at that time. Indian population figures for 2013 are an estimated 125.2 crore. Current population estimates for the US are about 32 crore, or the US has an internet density percentage of about 80, while China’s internet density percentage is about 50 and India just under 20.

     

    “Inexpensive mobile phones and mobile broadband connections are driving internet access and usage in countries where fixed internet has been out of reach for consumers, whether that’s due to lack of infrastructure or affordability,” said eMarketer senior forecasting analyst  Monica Peart. “While highly developed markets are nearly saturated in terms of internet users, there’s significant room for growth in emerging ones; for example, India and Indonesia will both see double-digit growth in each year between now and 2018.”

     

    The growing youth population is another important driver, as the most technologically savvy, and their demands shape internet development itself, says a Euromonitor report.

     

    According to the Telecom Regulatory Authority of India (TRAI), India had a wireline broadband subscriber base (speed greater than 512 kpbs) of 155.2 lakh and 852.3 lakh wireless broadband subscribers as on 30 April, 2015 or 1007.6 lakh broadband subscribers totally. This means that less than 1 per cent of the total population of the country has broadband. There is no denying the fact that the potential is huge, more so for broadband.

     

    Siti Cable (Siti), a multi system operator (MSO), believes that its strategy of cross-selling broadband services to its existing cable television subscribers and new customers will provide it with an opportunity to increase ARPUs, increase retention rates, ensure higher sustainable EBITDA margins and leverage upon its existing pan India presence.

     

    A few players such as medium sized MSO Atria Convergence Technologies (ACT) had actually changed its strategy since 2012 and started focusing more on broadband services, without losing focus on its MSO operations. It offers broadband internet in areas where it does not have cable subscribers. Despite being a regional player, ACT is the second largest private wired broadband player in the country, just after the mobile telecom behemoth Airtel. ACT’s broadband subscriber base has grown by 43.76 per cent to 6.11 lakh in the 12 months until 31December, 2014. As on 30 April, 2015, ACT had a wired broadband subscriber base of 6.8 lakh.

     

    However, ACT has followed a different strategy when compared to the other MSOs who use DOCSIS on the existing television cable for internet delivery. The company has laid separate optic fibre lines for internet delivery and hence owns even the last mile, rather than use its existing cable infrastructure and be dependent upon the LCOs’ whims and fancies.

     

    It must also be noted that the number of internet subscribers that each major cable television player in the US has runs in crores in a couple of cases. The largest MSO in India in terms of cable subscribers – Den Networks, with about 130 lakh subscribers has less than half the customer relationships that Comcast’s Cable Communications segment has with 272.34 lakh subscribers, of which about 223.75 lakh are video subscribers and 223.69 lakh are high speed internet subscribers. While Den’s cable subscriber base is about 58 per cent of Comcast Cable Communications segment, its internet subscriber base as on 31 March, 2015, is a small fraction at just 23,000 or just a little more than one thousandth of the internet subscribers that Comcast has. Even, ACT’s internet subscriber base of about 7 lakh is less than one-thirtieth of Comcast’s Cable Communications High-Speed internet subscribers. Is there any comparison?

     

    According to Nielsen’s 2015 Advance National TV Household Universe Estimate (UE), there are 11.64 crore TV homes in the U.S. prior to the start of the 2014-15 TV season. The number of homes represents a 0.5 per cent increase from Nielsen’s 2013-14 TV Household Universe Estimate. The number of persons aged 2 and older in U.S. TV Households is estimated to be 29.6 crore—also an increase of 0.5 per cent from last year. This puts the number of subscribers in the previous year as per Nielsen’s estimates at 11.58 crore.  The Indian carriage universe has 16.8 crore homes (44.3 per cent more than the estimated US TV homes) according to the FICCI- KPMG Indian Media and Entertainment Industry Report 2015. (FICCI-M&E 2015 report).

     

    The number of video subscribers through wire in the US as of 2013 was about 6.6 crore or the country had a cabletelevision percentage density just under 21. India has a TV home (TV Households or TV HH) density percentage of a little less than 13.5 (this includes DTH for India).

     

    Besides a number of cable television and IPTV service providers, the US has two big DTH players – Dish and Directv that had a combined subscriber base in Q1-2015 of approximately 341 lakh, or about 29 per cent of the total TV homes in the US estimated by Nielsen. India had an active DTH subscriber base of about 405.4 lakh (24.3 per cent of TV HH in India) as on 31 December, 2014.

     

     As mentioned above, in India, internet services ARPU is much higher than the ARPU from cable television services as compared to more mature markets such as the US, where it is the other way around. At the time of writing of this report, internet services monthly ARPU could be between 50 to 65 per cent of the video monthly ARPUs’ in the US. Video monthly ARPU would typically be in the range of US$ 75 to US$ 95, while internet monthly ARPU would range between US$ 40 to US$ 50. Is there an ARPU comparison? No way!

     

    Let us look at three players in the US. The entities in this report – Comcast Corporation’s Cable Communications segment, Time Warner Cable (TWC, about half the size of Comcast Cable Communications segment) and Charter Communications (Charter Comm) (About half the size again of TWC) represent about 32 per cent of the total US TV homes estimated by Nielsen.

     

    In Q1-2015, these entities combined video subscribers dropped by 6.12 lakh (1.61 per cent) to 373.47 lakh (32.09 per cent of Nielsen’s estimated TV Homes) from 379.59 lakh (32.77 per cent of Nielsen’s estimated TV Homes) in Q1-2014. Individually too, all the three entities reported loss of video subscribers in Q1-2015 to the extent of 1 per cent in the case of Comcast and Charter Comm and 3.08 per cent in the case of TWC, as compared to the corresponding year ago quarter. Despite the drop in video subscribers, the other two reported an increase in revenue from video in Q1-2015, while TWC even saw its video revenues drop by 1.04 per cent in Q1-2015 as compared to Q1-2014.

     

    The total number of internet subscribers of these three entities exceeded the total number of video subscribers in Q1-2015– internet subscribers grew to 392.5 lakh (5.1 per cent more than video subscribers) as compared to 369.45 crore (2.67 per cent less than video subscribers) in Q1-2014. All the three players reported increases in their internet subscription base as well as revenue from Internet in Q1-2015 when compared to the year ago quarter.

     

    Triple play (or triple product) subscribers increased in all the three cases, between 0.61 per cent in the case of Charter Comm to 14.49 per cent in the case of TWC and 4.26 per cent in the case of Comcast in Q1-2015 when compared to Q1-2014. TWC and Charter Comm’s double play subscriber base shrank 8.05 per cent and 0.6 per cent respectively, while Comcast’s double play subscription numbers increased in comparison during similar periods.

     

    Notes: (1) 100,00,000 = 100 lakh = 10 million = 1 crore

     

    (2) Revenues for US companies and some figures in this report have been mentioned in US$, million; subscription numbers in lakh or crore and TV homes in crore.

     

    (2) SARPU, a term similar to ARPU has been coined by the writer to bring terms to a common denominator for all the three US entities. To arrive at SARPU, the writer has added the quarterly revenues from each stream and divided the result by the number of customer relationships in that quarter and further divided the second result by 3 to arrive at a rough estimate of the revenue earned per relationship per month by the entity. Similarly, individual revenues from video, internet and voice streams/business have been divided by the number of subscribers of video, internet and voice streams respectively, further divided by 3 to arrive at an SARPU of that stream. Residential subscriber numbers have been used wherever available.

     

    (2.1) VIVE, another term coined by the writer, means video, internet and voice, the three main revenue generating streams or businesses for the three US entities in this report.

     

    (3) Voice numbers has been included, since there are number of overlaps in subscription numbers for VIVE of all the three entities.

     

    (4) ARPUs’ and SARPUs’ in this report are on a monthly basis unless stated otherwise.

     

    Comcast Cable Communications segment

     

    Comcast’s Cable Communications segment’s (probably the largest cable company and home internet services provider in the US) comprises 272.34 lakh relationships in Q1-2015 (quarter ended 31 March, 2015). The number grew by just 1.62 per cent from the 268 lakh in Q1-2014, and was driven by increases in double and triple product relationships.  This is what the cable industry in India is trying to ape – the double and triple play numbers.

     

    The breakup of these customers is 83.99 lakh single product, 2.39 per cent lower than the 86.05 lakh in Q1-2014; 88.90 lakh double product, 2.7 per cent more than the 86.56 lakh double product consumers in Q1-2014 and 99.45 lakh triple product consumers, 4.26 per cent more than the 95.39 lakh in  Q1-2014.

     

    The breakup of number of Comcast’s cable operations customers base on products is 223.75 lakh of video consumers in Q1-2015 – the number fell by 8000 as compared to the corresponding year ago quarter; 223.69 lakh high-speed internet consumers – the number increased by 4.07 lakh as compared to Q1-2014; and 112.70 lakh voices consumers – the number increased by 77000 as compared to the previous year ago quarter.

     

    Based on the financials filed by the company for Q1-2015, 69.16 per cent of the company’s consumers’ use two (double play) or more of its products, (up 127 basis points or 1.87 per cent higher) than the 67.89 per cent in Q1-2014.

     

    Let us examine the revenue that these businesses bring in for the company:

     

    Comcast’s Cable Communications segment revenue in Q1-2015 grew 6.26 per cent to US$ 11430 million from US$ 10757 million in Q1-2014. Combined revenue from Video, Internet and Voice (VIVE) businesses in Q1-2015 grew 4.89 per cent to US$ 9281 million (81.20 per cent of Cable Communications segment revenue) from US$ 8848 million (82.25 per cent Cable Communications segment revenue) in Q1-2014.

     

    Video revenue in Q1-2015 was US$ 5331million (57.44 per cent of VIVE revenue), 2.95 per cent more than the Rs 5178 million (58.52 per cent of VIVE revenue) in Q1-2014; Internet revenue in Q1-2015 grew 10.69 per cent to US$ 3044 million (32.80 per cent of VIVE) from US$ 2750 million (31.08 per cent of VIVE) in Q1-2014. Voice revenue fell 1.52 per cent in Q1-2015 to US$ 906 million (9.6 per cent of VIVE revenue) from US$ 920 million (10.4 per cent of VIVE revenue) in Q1-2014.

     

    A simple back of the envelope calculation as mentioned in Note 2 above shows the simple average monthly revenue per user (SARPU) of US$ 113.60 for Q1-2015, up 3.22 per cent as compared to the US$ 110.05 in Q1-2014.

     

    Similarly, Video SARPU grew 3.99 per cent in Q1-2015 to US$ 79.42 from US$ 76.37 in Q1-2014; Internet services SARPU grew 4.25 per cent to US$ 45.36 (56.97 per cent of video SARPU) in Q1-2015 from US$ 43.51 (57.12 per cent of video SARPU) in Q1-2014; Voice SARPU fell 5.06 per cent to US$ 26.80 from US$ 28.23 in the year ago quarter.

     

    Time Warner Cable

     

    Let us see how another big player in the US performed – Time Warner Cable (TWC).  In Q1-2015 the company saw its highest q-o-q growth in internet subscriber base since 2007 by 3.15 lakh to 119.90 lakh from 116.75 lakh in the quarter ended 31 December, 2014. Y-o-y, the company’s internet subscriber base grew by 6.32 lakh. However, the company’s video subscribers fell 3.08 per cent in Q1-2015 to 108.19 lakh from 111.63 lakh in Q1-2014. Voice subscribers increased 14.06 per cent in Q1-2015 to 56.04 lakh from 49.13 lakh in Q1-2014. TWC’s customer relationships increased 1.27 per cent in Q1-2015 to 147.16 lakh from 145.32 lakh in Q1-2014.

     

    In Q1-2015, the number of consumers using TWC’s double or triple play increased by 64 basis points (up 1.05 per cent) to 61.45 per cent from 60.81 per cent.

     

    TWC’s overall revenue in Q1-2015 grew 2.06 percent to US$ 4662 million from US$ 4568 million in Q1-2014. Its VIVE revenue in Q1-2015 grew 1.96 per cent to US$ 4638 million (99.49 per cent of overall revenue) from US$ 4549 million (99.58 per cent of overall revenue) in Q1-2014.

     

    Video revenue fell 1.04 per cent in Q1-2015 to US$ 2469 million (53.23 per cent of VIVE revenue) from US 2495 million (54.85 per cent of VIVE revenue); Internet revenue grew 8.86 per cent to US$ 1696 million (36.57 per cent of VIVE revenue) in Q1-2015 from US$ 1558 million (34.25 per cent of VIVE revenue) in Q1-2014. Voice revenue in Q1-2015 fell 4.64 per cent to US$ 473 million (10.2 per cent of VIVE revenue) from US$ 496 million (10.9 per cent of VIVE revenue).

     

    TWC’s SARPU per customer relationship was US$ 105.06 in Q1-2015 or 0.68 per cent higher than the US$ 104.34 in Q1-2014.

     

    TWC’s video SARPU in Q1-2015 increased 2.1 per cent to US$ 76.07 from US$ 74.50 in Q1-2014; Internet SARPU increased 3.12 per cent to US$ 47.15 (61.98 per cent of video SARPU) in Q1-2015 from US$ 45.72 (61.37 per cent of SARPU) in Q1-2014 and Voice SARPU fell 16.4 per cent in Q1-2015 to US$ 28.13 from US$ 33.65 in Q4-2014.

     

    Charter Communications

     

    Charter Communications (Charter Com), an even smaller player than Comcast or TWC, reported 4.48 per cent growth in residential consumer relationships in Q1-2015 to 59.27 lakh from 56.73 lakh in Q1-2014. Video subscription base fell 1 per cent to 41.53 lakh (70.07 per cent of total relationships) from 41.95 lakh (73.95 per cent of total relationships) in Q1-2014; Internet subscription base grew in Q1-2015 by 8.23 per cent to 48.91 lakh (82.52 per cent of total relationships, addition of 3.23 lakh subscribers) from 45.91 lakh (79.66 per cent of total relationships) in Q1-2014; Voice subscribers grew 6.71 per cent in Q1-2015 to 24.81 lakh (59.74 per cent of total relationships) from 56.93 lakh (40.98 per cent of total relationships) in the corresponding year ago quarter.

     

    Overall revenue grew 7.27 per cent to US$ 2362 million in Q1-2015 from US$ 2202 million in Q1-2014. VIVE revenue in Q1-2015 grew 6.68 per cent to US$ 1980 million (83.83 per cent of overall revenue) from US$ 1856 million (84.29 per cent of overall revenue).

     

    Video revenue increased 3.58 per cent in Q1-2015 to US$ 1129 million (53.23 per cent of VIVE revenue) from US$ 1090 million (54.85 per cent of VIVE revenue) in Q1-2014; Internet revenue increased 16.4 per cent to US$ 717 million (36.21 per cent of VIVE revenue) in Q1-2015 from US$ 616 million (33.19 per cent of VIVE revenue) in Q1-2014. Voice revenue in Q1-2015 fell 10.67 per cent to US$ 134 million (6.77 per cent of VIVE revenue) from US$ 150 million (8.08 per cent of VIVE revenue) in Q1-2014.

     

    Charter Comm’s SARPU in Q1-2015 increased 2.11 per cent to US$ 111.35 from US$ 109.05 in Q1-2014. Video SARPU increased 4.63 per cent to US$ 90.62 in Q1-2015 from US$ 86.61 in the corresponding year ago quarter; Internet SARPU in Q1-2015 increased 7.54 per cent to US$ 48.87 (53.92 per cent of video SARPU) from US$ 45.44 (52.46 per cent of video SARPU) in Q1-2014; Voice SARPU fell 16.28 per cent in Q1-2015 to US$ 18 from US$ 21.51 in Q1-2014.

     

    Let us see what the richest Indian does through Reliance Jio Media, for this is probably the only group/entity that has the deep pockets to really offer a shimmer of comparison with the media giants in the US.

     

    Can we truly compare Cable television internet in India with the industry in the US? No way!

  • The making of ‘Junior’ stars

    The making of ‘Junior’ stars

    It was a countdown that began in the year 2004. Armed with a huge promotional blitz, Sony Entertainment Television (SET) launched its ‘big one’: an ambitious project that threatened to challenge the viewing habits of the telly loyals.

    Be it a lack of hit since Bade Achhe Lagte Hain, or the obvious threat posed by the ‘youth or women oriented’ focus of several other general entertainment channels (GECs), SET has a huge stake with the desi version of FremantleMedia’s Pop Idol.

    The mega budget Indian Idol is SET’s bid to fortify its youth viewer base. Multi Screen Media (MSM) calls this talent hunt a power brand created by Sony in the past 15 years, which stands above a few other powerful brands created by the channel including CID, Aahat, Boogie Woogie among others.

    Indian Idol so far has produced six successful seasons. Worried of the show reaching a fatigue level, the channel introduced a sub-franchise targeting kids with Indian Idol Junior in 2013. On the back of a successful first season, Sony has come back with the second edition this year.

    Indian Idol Junior2 currently showcasing the audition round, will see the ‘juniors’ paying tribute to the maestros of Indian music at the season’s grand launch. What’s more, the talent quotient has gone a notch higher with the inclusion of actor Sonakshi Sinha as one of the judges.

    A look at the journey

    While all looks glamorous when one watches the show on TV, producing half an hour to one hour of reality show is no child’s play.

    At any given time, more than 100-200 people work to make a reality show. The production team and the crew are as important as the talent and really make the show happen. When a fiction show is penned, one has to simply write all the relevant beats to that week’s tale, but with reality programmes, things are a bit different.

    Let’s take a look at all the madness that goes backstage while making a show like Indian Idol Junior2.

    For FremantleMedia India managing director Anupama Mandloi the blueprint of these formats is simple, uncomplicated, clean and universally adaptable. A reality show like Indian Idol while is relevant to any culture across the globe, it also has the ability to absorb the local DNA, thus becoming a true representation of the region they are produced in.

    “The audience enjoys the predictability of the journey, the range of talent, as well as the fresh and exclusive energy each season brings. Characters and storytelling define any good show. These shows are all about creating strong, memorable, aspirational and yet relatable characters whose journey and endgame is contained within a finite number of weeks,” she explains.

    Considering the basic blueprint remains the same, making any new edition look fresh is the biggest challenge. “We look at various elements: right from the talent to choosing areas for getting fresh, new voices to the panel of judges depicting their camaraderie and journey through the show. We also look at scheduling, how to differentiate various phases of the show as well as the larger story that we want to convey through the programme. These shows are all representative of current times and there is a definite change in narrative that comes through the contestants on the show,” Mandloi explains.

    She believes that when they first started the journey of reality shows, it gave audiences a sense of opportunity, scale and transformation. Over the years, it has reflected the pathos of underprivileged lives, their acceptance of destiny and the rooted middle class values.

    But, the narrative now is of achievers, children wanting the best and working towards it as well as a growing sense of community through technology. “It is about expecting the best and taking destiny into their hands. These shows are fascinating in what they throw up as you gather stories from across India,” she adds.

    Content Creation

    For starters, broader and thematic links for hosts is written before hand after a lot of internal discussions. A large part of the script is written on the ground based on situations as they unfold. As per Mandloi, this year the show witnessed the turnout of an unprecedented number of twins.

    She further goes on to say that the writers do not write scripts for judges because that never works. “The judges are articulate and capable of phrasing their thoughts. Scripting for the judges or the kids would make the show fake and we have a fairly purist approach to this aspect of the show. The viewers can tell if a show is over produced,” she asserts.

    There is only one writer who works closely with the creative director, associate creative director and the anchor director. It is all about the brief and how the writer links it with existing social norms and then how he wants the show to resonate. “The idea is to give the show consistency and a sense of purpose. Be it celebration, search, revelation, wish fulfillment,” she explains.

    There was no extensive research for this season, says Mandloi.  But, with a successful first edition, the makers were keen to establish the junior brand with the second season.

    “This season is a celebration of talent rather than a discovery and that is probably what is showing up through all interactions. There was a reflection on elements that worked and those that could have been better and we moved forward with those learnings in place. The top 13 is a true reflection of India from north, south, east and west. The top 13 is a wide range of voices as well as personalities and the talent is fresh and memorable,” she reasons.

    Reality shows are exhausting & relentless

    According to Mandloi, Indian Idol Junior took almost nine intense months of work and the crew usually faces a vacuum once the show gets over. “These shows are exhausting as they are relentless and require dedicated commitment from the team. At FremantleMedia, we are very careful to work with the best in the industry. They take pride in their work and that is always reflected in the quality of the show.”

    For IIJ, the makers had a one year window to find the talent and according to Mandloi that is clearly coming across in the show.

    It was a three months journey for the talent hunt to finally complete the auditions. While a number of children are called through an established network of music schools, institutions and gharaanas, there is also an open audition for which people register and audition.

    Since the show deals with kids, the makers ensure that children come with guardians. Food and water is provided and while the wait can be long, it does not allow entries after 5 pm. Moreover, the crew has contestant managers and their teams as well as a large ground team that helps address any issues that may crop up.

    “We are very careful with children. As far as possible we do try and ensure that the children are treated gently and with care. The entire team is briefed and prepped before the unit hits the road,” she says.

    How do the makers ensure a good turnout for auditions? Says Mandloi, “We can’t really control this beyond a point. In some cities the turnout is fabulous and in some it is sometimes underwhelming but for us the focus is not on the volume as much as it is on the talent. We make sure that a fair opportunity is provided to all those who are present.”

    According to Mandloi, she has been very fortunate with her channel interactions. “There is great faith in the team as well as belief in the format. There is a lot of creative freedom for this reason and the show is eventually a collaboration of creative ideas and execution.”

    Live, Camera & Action

    The show began the actual shoot approximately three months before going on-air.

    The audition phase is an accumulation of shoot footage of over two months which is then sifted through and assembled into episodes. “It is a tough process though now we have very good teams that have understood the process and are very skilled at connecting the dots,” she opines.

    The theatre phase is shot over three days. The concert episodes are shot every Sunday with a live result episode.

    One single episode takes anywhere from three weeks to five hours depending on the nature of the episode. The audition episodes take the longest as there is hours and hours of footage that needs to be culled, assembled and structured into a narrative. The live result takes approximately five hours and the concert episodes take close to three days.

    For all these, the production house has a large set-up with multiple machines and large post teams. A very tight core team drives the show. It hires the technical, creative as well as production teams on project basis. For a show of this size it is usually around 200 people on ground.

    To manage the crowd and ensure enough eyeballs in the studio, a large part of the crowd is sourced through audience co-coordinators. Moreover, there is a floor manager and his team that takes care of audience management as well as all the ground show flow.

    Every season needs to focus on bringing together fresh, exquisite talent that people align themselves with. This alignment dictates how they feel about the judge panel and the judges’ personal graphs within the show.

    For IIJ season2, judges like Vishal Dadlani, Shalmali Kholgade and Salim Merchant were selected for their credibility, their ease with children, ability to connect with viewers, personality and a very strong sense of who they are as opposed to who they are trying to project.

    Host Hussain Kuwajerwala and co-host Asha Negi were selected for their ability to be spontaneous, charming as well as the ability to connect with kids and viewers.

    This season the makers have conceived a set that is unlike any so far in its true 360 degree design. It’s intimate, glamorous and yet very fresh. A wireless cam does a 360 degree revolution around the centre stage. The families, contestants, audience and judges are all seated around the circular stage so that the contestant feels connected to all.

    The contestant performs in a central arena surrounded by graphics and the live band fills the set with its magic. IIJ 2 is being shot with 15 cameras.

    Reality shows costs a bomb

    One cannot deny the fact that reality shows are expensive. The production house is allocated with a budget and it has to work under those tight budgets.

    A media planner believes that though they are high budget shows, it is not in the cost of content. “The focus is to make sets bigger and shiny with more lights.  But, that is not what attracts the audience anyways.”

    According to a planner, it is the celebrity quotient that increases the cost of production.  “If you are working on a budget, you usually have to figure out what level of celebrity you can afford and that decides the costing. While the scale of the show is controllable, it is the demand for a particular celebrity which takes the cost high,” adds the planner.

    The production cost per episode of IIJ season 2 is somewhere between Rs 30-35 lakh.

    Sony, which currently is at the sixth position at the television ratings chart, has high hopes from this season of Indian Idol Junior. While the stage is set for the star performers, whether it will open up the stars for the channel is yet to be seen.   

  • FY-2015: Indian cable industry – long haul work in progress

    FY-2015: Indian cable industry – long haul work in progress

    BENGALURU: The cable industry in India has made a remarkable amount of progress in implementing DAS in phase I and phase II considering the weak balance sheets that most players carry, but all still have a long way to go before they actually start making profits. However, the promise of addressability, greater transparency and higher average revenue per user (ARPU) is yet to be realized by the cable industry.

    Current Status

    As on 31 December, 2014, 138 multi system operators (MSOs) have been granted permanent registration (for 10 years) for providing Cable TV services through Digital Addressable Systems (DAS) by the Ministry of Information and Broadcasting (MIB).

    DAS roll out in phases III and IV is expected to be more challenging on account of larger geographical spread, poor balance sheets of the cable industry players and low potential for ARPUs from the conventional cable carriage and subscription business. Implementation of phases I and II was challenging, tiered packages have yet to be offered to the viewer and billing is still work in progress as MSOs still face resistance from local cable operators (LCOs) in giving up ownership of customers in some cases.

    Cable players in India have started giving broadband services a lot of serious attention in fiscal 2015. A few players such as the medium sized MSO Atria Convergence Technologies Private Limited (ACT) had actually changed strategy since 2012 and started focusing more on broadband services, without losing focus on its MSO operations. Despite being a regional player, ACT is the second largest private wired broadband player in the country with a market share of 3.24 per cent and over 6.11 lakh broadband subscribers as on 31 December, 2104, just after the behemoth Airtel (15 lakh subscribers, 7.95 per cent market share). ACT had 4.25 lakh (includes numbers of Beam Telecom Limited which was merged with ACT on 1 April, 2014) broadband customers as on 31 December, 2013 and hence, its broadband subscriber base has grown by 43.76 per cent in the 12 months until 31 December, 2014. As on April 30, 2015, Atria had a wired broadband subscriber base of 6.8 lakh.

    Public sector companies such as BSNL (the largest wired internet services player in India with 69.83 per cent market share, 1.317 crore subscribers) and MTNL (6.02 per cent market share and 11.3 lakh subscribers) are of course bigger players in the wired broadband services than ACT. Among the major MSOs in the country, Indusind Media & Communications Limited is probably the only player whose broadband subscriber base has not grown much until 31 December, 2014, during which the company reported 29,709 internet subscribers (including 3539 narrowband subscribers) as compared to the 28,337 subscribers (including 4750 narrowband subscribers) as on 31 December, 2013.

    Internet services has turned into a heavy capex exercise for many MSOs where the last mile is owned by LCOs mainly because an MSO may not be allowed access to the customer for sales and service by the LCO, and/or the quality of the cable may not be at par.

    This report takes four MSOs – Den Networks Limited (Den), Siti Cable Network Limited (Siti), Hathway Cable and Datacom Limited (Hathway) and Ortel Communications Limited (Ortel), financials as a sample size.

    Note: 100,00,000 = 100 lakh = 10 million = 1 crore

    Let’s look at FY-2015 numbers reported by these companies:

    (Please refer to Fig 1 below) The sum total of operating revenue (OR) for these companies in FY-2015 grew 9.94 per cent to Rs 3213.27 crore from Rs 2922.86 crore in the previous year. Den, the company with the highest operating revenue numbers and subscriber base amongst the three, showed the lowest operating revenue growth of just 1.16 per cent to Rs 1129.64 crore in FY-2015 from Rs 1116.69 per cent in FY-2014. Siti showed the highest operating revenue growth at 29.93 per cent in FY-2015 at Rs 905.93 crore from Rs 627.24 crore in FY-2014. The minnow – Ortel’s operating revenue grew 20.46 per cent to Rs 158.79 crore in FY-2015 from Rs 128.50 crore in the previous fiscal, while that of the second largest player among the four, Hathway grew 4.33 per cent to Rs 1022.91 crore in the current year from Rs 980.43 crore in FY-2014.

    Cable Subscription Numbers

    Most MSOs’ revenue model is subscription, carriage plus advertising charges for cable services and broadband. Set- top-box (STB) seeding is a one time periodic revenue (maybe once every five years?) for the companies that could later erode the profits – considering the depreciation and the interest cost on the STB subsidy that many MSOs offer to subscribers.

    In its FY-2014 annual report, Den said it serves an estimated 1.3 crore households of which over 64 lakh had opted for digital subscription as on 31 March, 2014. The company has a digital subscriber base of 70 lakh (53.85 per cent of total number of 1.3 crore subscribers) as on 31 March, 2015, of which 51 lakh are in phases I and II of DAS, and Den continues to bill about 80 per cent of these subscribers.

    On the other hand, Siti has reported 1.05 crore subscribers and a digital subscriber base of 53.8 lakh (51.24 per cent of total subscribers) for FY-2015, a conversion of 13.8 lakh subscribers to digital over a 12 month period, from the 40 lakh digital subscribers it had reported at the end of FY-2014. As a matter of fact, in Q4-2015, the company deployed 5.3 lakh STBs, and a big portion of its seeding had taken place then.

    Hathway has a subscriber base of 1.18 crore of which 85 lakh (72 per cent of total subscribers) are digital and 65 lakh are paying subscribers. This makes it the biggest player in the country in terms of digital subscribers.

    Ortel reported a subscriber base of 4.72 lakh in FY-2015 as compared to 4.61 lakh in FY-2014. The company reports 1.07 lakh (22.73 per cent of total subscribers) digital subscribers as on 31 March, 2015.

    Ortel CEO and President Bibhu Prasad Rath said, “Ortel Communications’ direct-to-consumer offering with full control over the ‘last mile’ network has enabled us to emerge as a dominant regional player in the cable TV and broadband business. With increasing penetration in our core and emerging markets along with the inorganic LCO buy out strategy, we believe we are well-positioned to achieve our immediate target of approximately 1 million RGUs by the end of FY-2017.”

    Subscription income for all the four mentioned companies has grown, with Siti showing the highest jump at 56.41 per cent – from Rs 339.5 crore in FY-2014 to Rs 531 crore in FY-2015. (Please refer to figure 2 below) Ortel’s subscription revenue grew the least 4.36 per cent – from Rs 75.7 crore in the previous year to Rs 79 crore in FY-2015.

    Siti Cable executive director and CEO V D Wadhwa said, “Our focus on monetization of existing business in phase I and II cities in FY-2015, led to a strong subscription revenue growth of 57 per cent y-o-y and operating EBITDA margin expansion. Siti Cable is engaged in proactive seeding and well placed to benefit from the ongoing digitization process.”

    Internet Services

    As mentioned above, offering internet service is a part of many of the major MSOs’ business and revenue expansion strategy. Internet services, and more so broadband services of all the four companies mentioned in this report have in general shown higher revenue growth than their cable services revenues.

    Den commenced its broadband services in Q1-2015 and has garnered 23,000 subscribers since then. Den CEO Pradeep Parameswaram said, ”We are laying the foundations of building a powerful consumer franchisee in broadband, cable television and television shopping. Significant investments are being made to bring disruptive consumer offerings to the market. We are augmenting out historical strengths in cable operations with high quality talent in all functions.”

    Siti Cable’s broadband revenue in FY-2015 grew 53.3 per cent to Rs 26.5 crore from Rs 17 crore in FY-2015. The company reported a broadband subscriber base of 70,100 in FY-2015 as compared to 54,000 in FY-2014.

    “We are looking to expand our broadband presence on Docsis technology in our endeavour to diversify our revenue stream and provide the consumer with a compelling experience,” added Wadhwa.

    Hathway’s broadband revenue jumped 47 per cent to Rs 247.5 crore in FY-2015. With the addition of Delhi and Central Mumbai to Docsis 3.0 and upgradation of Surat Network, Hathway is the only MSO to offer high speed 50 mbps broadband services in Delhi, Mumbai, Pune, Bangalore, Hyderabad and Surat.

    Ortel’s broadband revenue increased five per cent to Rs 28.9 crore in FY-2015 from Rs 27.5 crore in FY-2014. The company’s broadband subscribers increased 7.52 per cent in FY-2015 to 58,519 from 54,427 in the previous year.

    “We anticipate further improvement in margins going forward as a result of deeper penetration in the Cable business along with our continued focus on the high-margin Broadband segment,” said Ortel’s Rath.

    EBIDTA

    The financials of three of the four sample players showed an increase in operating profits (simple EBIDTA including other income). (Please refer to Fig 3 below) Den EBIDTA dropped to half at Rs 180.23 crore in FY-2015 from the Rs 360.41 crore in FY-2014. With an increase of 94.17 per cent, Siti’s FY-2015 EBIDTA almost doubled to Rs 168.43 crore from Rs 86.74 crore in FY-2014. Hathway’s EBIDTA in FY-2015 increased 16.13 per cent to Rs 560.9 crore from Rs 483 crore in the previous year. Ortel’s EBIDTA increasd 44.6 per cent to Rs 59.05 crore from Rs 40.84 crore in the previous fiscal.

    Profit/Loss

    (Please refer to figure 4 below) Two of the three large players in this sample – Siti Cable and Hatway have reported higher loss in FY-2015, while Den’s results have turned to the red in FY-2015 from the black in FY-2014. Ortel, which was listed a few months ago on the bourses, is the only one among the four that has reported a small profit of Rs 5.90 crore (3.62 per cent margin) in the current year as compared to a loss of Rs 13.79 crore in the previous year.

    “We have seen the positive results on subscription revenues and collections in Q4 of the current year. The profitability has been impacted because of the new business initiatives of the company including broadband, TV Shop and football as we build Den for future,” said Den’s Parameswaran.

    Last year, Den became the owner of the Hero Indian Super League’s Delhi Team – Delhi Dynamos FC. With the introduction of Delhi Dynamos FC, the company aims to become the default destination for entertainment, information and interactivity for the Indian family.

    End Points

    As the value chain shifts to addressable systems and tiering, growth in cable TV ARPUs will be driven by customized channel packs, premium content channels, HD channels and other value added services. It will not be easy going because cable industry players have to contend with DTH players who have strong balance sheets and are backed by deep pockets – be it Airtel, Tata Sky, Videocon d2h, Sun Direct or Reliance.

    The cable industry players need to sort out the ambiguity about revenue shares between the MSOs and LCOs and between the MSOs and broadcasters. The one positive is that larger MSOs appeared to have stopped poaching LCOs from each other, at least in phases I and II areas. “It’s not because the industry has turned goodie-goodie all of a sudden. Generally, it is just not worth the cost to pay to an LCO to switch loyalties in a phase I and II areas, or any area where digitsation has happened in a major way,” reveals an MSO on condition on anonymity. That attitude has to change for the common good of the industry.

    An industry source cites instances of LCOs still trying to fudge numbers despite deployment of STBs, with the LCOs claiming that a customer has relocated without returning the STB, or fudging with the number of STBs received. On the other hand, some LCOs need help in developing a robust last mile infrastructure.

    The cable industry has to leverage whatever advantages it has – this could be providing local information and relevant local news, local advertisements, etc., on MSOs’ own channels and services.

    A key differentiator could be the service quality and the personal connect that many operators have developed with consumers. Industry players need to change the impression they create right from ground up. This includes approach to customers for bill collection, to how each individual is perceived by anyone and everyone in the value chain, and more so banks and financers. Big as well as multiple middle sized players have already brought in a degree of professionalism across many levels and hence have relatively easier access to funding.

    Long term common purpose unity is what the cable industry needs desperately. Each player has to mature, has to understand and accept that one cannot do without the other. The road is still long and arduous.

  • FY-2015: Inflection point for DTH companies in India?

    FY-2015: Inflection point for DTH companies in India?

    BENGALURU: Is FY-2015 the inflection point for direct to home (DTH) companies in India? The answer seems yes, if one were to go by the financials declared by three listed operators for the quarter and year ended 31 March, 2015 (Q4-2015 and FY-2015 respectively) – Airtel Digital TV, Dish TV and Videocon d2h. And the players are gung-ho about the future. Subscriber growth and higher ARPUs (Average Revenue Per User) are some of the factors that have brightened the picture for this segment of the carriage industry in fiscal 2015.

     

    Note: 100,00,000 = 100 lakh = 10 million = 1 crore.

     

    This report covers only three of the seven DTH service providers in India since the other four – Reliance Digital TV, Sun Direct (about 97 lakh subscribers as on 31 March, 2015), Tata Sky and DD Free Dish are not listed on the bourses and their financial numbers are not available.

     

    The Numbers

     

    Dish TV

     

    Dish TV’s standalone and consolidated net Total Income from Operations (TIO) in FY-2016 at Rs 2781.64 crore was 10.9 per cent more than the Rs 2508.97 crore in FY-2014. Standalone TIO in Q4- 2015 at Rs 754.72 crore grew 18.5 per cent as compared to the Rs 636.91 crore in the corresponding year ago quarter and was 10.3 per cent more than the Rs 684.26 crore in Q3-2015.

     

    According to Dish TV, the DTH sector is a direct beneficiary of a positive consumer sentiment. The company achieved strong subscriber growth of 1.5 million net subscribers during the year. Fiscal 2015 also saw Dish TV swing to net profit, a first for any DTH company in India.

     

    The biggest among the three in terms of revenue as well subscribers, Dish TV at the close of FY-2015, reported standalone net profit after tax (PAT) of Rs 35.01 crore in Q4-2015 and a standalone PAT of Rs 1.01 crore in FY-2015 as compared to a standalone loss of Rs 154.21 crore in FY-2014. For Q3-2015, Dish TV’s loss was just Rs 2.87 crore as compared to double-digit crore loss numbers in the previous or like-to-like quarters. Dish TV also doubled its subscriber growth to 15 lakh in FY-2015 as compared to the previous year. As on 31 March, 2015, the company reported a net subscriber base of 1.29 crore, having added 4.04 lakh subscribers in the last quarter of 2015.

     

    Dish TV also reported higher ARPU of Rs 179 in Q4-2014 as against Rs 177 in Q3-2015 (1.13 per cent increase in ARPU) and was 5.3 per cent higher than the annual ARPU of Rs 170 reported in Q4-2014.

     

    “As digitization spreads far and wide, we continue to believe that there is sufficient headroom to further explore price differentials between key urban markets and their rural counterparts. All pack prices, for new as well as existing subscribers of Dish TV, have been moved by Rs 10 each in the 42 cities under phase I and II. We are confident that pack price hikes, higher HD uptake, as well as industry level developments such as initiation of packaging in cable will be key contributors to ARPU expansion going forward,” said Dish TV managing director Jawahar Goel.

     

    Post a successful absorption of higher pack prices in Delhi, Mumbai, Pune and Kolkata, Dish TV initiated another price change during the current month. In less than three months since it was first introduced, differential pricing – an industry first from Dish TV was rolled-out in the balance 38 cities covered under DAS phases I and II with effect from midnight on 12 May, 2015.

     

    Last year Dish TV launched a second brand, Zing, in the Indian DTH space. A resounding success, Zing cemented Dish TV’s supremacy in the DAS Phase 3 and 4 markets with custom-made content, hardware and service packages for the regional audience, says the company.

     

    Airtel Digital TV Services

     

    Airtel’s Digital TV Services (DTH segment) revenue grew 19.2 per cent in FY-2015 to Rs 2475.9 crore from Rs 2077.1 crore in FY-2014. The segment reported 11.8 per cent growth in number of subscribers with 100.73 lakh subscribers on 31 March, 2015 as compared to the 90.12 lakh subscribers at the close of the previous year. ARPU in FY-2015 at Rs 214 was five per cent more than the Rs 203 in FY-2014. The segment reported slightly higher monthly churn of one per cent as compared to 0.9 per cent in FY-2014.

     

    The DTH segment reported an operating profit of Rs 8.1 crore in Q4-2015 as compared to an operating loss of Rs 36 crore in the immediate trailing quarter. For FY-2015, Airtel DTH reported a lower operating loss of Rs 158.1 crore, for FY-2014, operating loss was three times more at Rs 481.2 crore.

     

    EBIDTA and EBIDTA margins in FY-2015 at Rs 675.2 crore (27.3 per cent of total revenue) were more than double (2.02 times) the Rs 334.7 crore (16.1 per cent of total revenue) in the previous year.

     

    Videocon d2h

     

    Coupled with higher ARPU for FY-2015 at Rs 196, and Rs 202 in Q4-2015, Videocon d2h reported 32.5 per cent growth in revenue from operations in FY-2015 at Rs 2337.7 crore as compared to the Rs 1764.4 crore in FY-2014. The company’s subscription revenue increased 38.3 per cent in the current year to Rs 2058.1 crore from Rs 1487.7 crore in the previous year.

     

    Videocon d2h says that it was able to push through an inflation linked ARPU increase in February 2015. As a result, Q4-2015 ARPU was Rs 202, up 11.7 per cent from FY-2015.

     

    Videocon d2h closed fiscal 2015 with 101.8 lakh subscribers as compared to 84.4 lakh in the previous year. It claims market leadership in subscriber growth in FY-2015 with 26.4 lakh gross subscribers and 17.4 lakh net subscriber additions. Subscriber churn per month increased fractionally in FY-2015 to 0.8 per cent as compared to 0.76 per cent in the previous year.

     

    The company reported lower net loss in FY-2015 at Rs 272.7 crore as compared to the Rs 319.5 crore in the previous year. Adjusted EBIDTA increased 55.3 per cent in the current year to Rs 609.1 crore (margin 26.1 per cent) from Rs 319.5 crore (margin 34.1 per cent), the company said in its earnings release on NASDAQ.

     

    Videocon d2h CEO Anil Khera said, “The Pay TV segment in India is positioned for extraordinary growth over the next few years with millions of new TV homes being created on account of the strong economic outlook in India as well as the Government of India’s initiative to roll out its digitalization mandate across the country. We believe that 9 to 10 crore homes will be making the switch to digital platforms, which will be available to the DTH and digital cable operators. We are well positioned to benefit from this and we believe we will take the largest share of this opportunity, as we have in the past. With strong economic growth outlook for India, overall media sector is expected to grow in the years to come. We believe this will help grow ARPU, TV penetration and increase HD uptake leading to stronger revenue growth for Pay TV in general and Videocon d2h in particular.”

     

    End points

     

    The last quarter of fiscal 2015 (Q4-2015) has shown better than average results in the case of all the three DTH players examined in this report. PAT in Q4-2015 eliminated the loss Dish TV incurred in the first three quarters of FY-2015. In the case of Airtel DTH segment, EBITDA for Q4-2015 increased to Rs 207.8 crore as compared to Rs 96.7 crore in the corresponding quarter last year. The reported EBITDA margin improved significantly to 32.7 per cent in Q4-2015, as compared to a margin of 17.9 per cent in the corresponding quarter last year.

     

    As mentioned above, Airtel DTH turned EBIT positive to Rs 8.0 crore in the current quarter, as compared to EBIT loss of Rs 110.7 crore in the corresponding quarter of last year. Comparable numbers for Videocon d2h have not been made available since the company debuted on NASDAQ on 1 April, 2015 and has disclosed only a limited amount of information about its annual numbers.

     

    The Indian carriage universe has 16.8 crore households. DTH operators have continued to focus on improving realisations by increasing penetration of HD channels, premium channels and value added services (VAS) according to the FICCI-KPMG Indian Media and Entertainment Industry Report 2015. However, they may have to rework their channel packages to be more relevant and affordable for phases III and IV subscribers. A case in point mentioned above is Dish TV’s sub-brand Zing, which caters to specific linguistic needs of subscribers and offers regional specific packs as a part of all available packs.

     

    Also, all major DTH operators have launched apps for mobiles and tablets through which subscribers can watch live TV for an additional fee and DTH operators have the advantage of monetising these viewers because of their existing payment relationships with their subscribers. 

     

    The FICCI-KPMG 2015 report also says that battle for subscribers in phases III and IV of DAS in India is expected to be more keenly fought between MSOs’ and DTH players. While DTH players managed to get only 20 to 30 per cent of the subscribers converting from analogue to digital in phases I and II, they are in a much better position in phases III and IV due to inherent technology advantage of DTH in sparsely populated areas and also due to their balance sheets being healthier than the MSOs’.

     

    The Ministry of Information and Broadcasting extended the deadlines for phases III and IV to 31 December, 2015 and 31 December, 2016, respectively, and there could be another delay by 12 months according to experts, which means that phase IV rollout could complete only at the end of 2017 or even 2018. The benefits of digitisation in these phases in terms of improved addressability and ARPU is expected to take much longer. At the end of 2019, the FICCI-KPMG report expects digital cable subscriber and DTH subscriber ratio to be 55:45 with 9.4 crore digital cable subscribers and 7.6 crore DTH subscribers.

     

    HITS (Headends in the Sky), if it takes off even in a small way, could affect the fortunes of both the DTH and the cable TV industry. Let’s wait and watch how the Hinduja Group, which has a license to launch HITS and is a major player in the cable TV business, plays this out. Jain TV, the other licensee for HITS, has made a miniscule dent. IPTV is still at less than an infancy stage in the country.

     

    If DTH companies can sustain, innovate in technology and offerings and grow from here, FY-2015, and maybe Q4-2015 could really be the turning point when at least one segment of the carriage business in India has started making money. Only time will tell…

  • Nestled in controversy, brand Maggi in a soup

    Nestled in controversy, brand Maggi in a soup

    MUMBAI: Nestled in controversy over the presence of lead beyond permissible limits in its popular noodle brand Maggi, Nestle India has found itself in a soup. As Barkha Dutt tweeted, it could well be “The Two Minute death of a brand #Maggi.”

     

    What’s more, a domino effect followed immediately with the recent detection of creepy-crawlies in Nestle’s other food product Nan Pro-3.

     

    A brand being embroiled in controversy is not something new with the likes of Cadburys and cola companies having faced similar problems in the not so distant past. About a decade ago, there was uproar over worms being found in Cadbury chocolates. On that note, the company said that most stores in India at that time didn’t have refrigerators and that had affected the product. Similarly cola brands were hit with the pesticide crisis in early 2000, which wiped off their growth for over two years.

     

    In testing times like these for brand Maggi, the big question on everyone’s lips is… could this hullabaloo well sound the death knell for the brand, which has been around in India for decades?

     

    Speaking to Indiantelevision.com about the controversy, Kwan Entertainment & Marketing Solutions COO Indranil Das Blah strongly believed that if Maggi is being held accountable, so should the government, for the simple reason that it has been approved by the Food Safety and Standards Authority of India (FSSAI), which is a government body.

     

    “I don’t think it’s the death of the brand in India. They’ve been around for about two decades now. A lot of brands have faced similar controversies, be it the cola brands or various food companies. Having said that, it has been approved by the FSSAI, which is why it is available in the market in the first place. Maybe a certain batch had certain excess content of lead and that is something that the judiciary should decide,” Blah said.

     

    Harish Bijoor Consultants CEO Harish Bijoor opined, “It’s a big shock for Maggi. The trauma is for the consumers as well because they love the brand so much.”

     

    According to Blah, while the controversy will definitely cause immediate damage to the brand, in the long run the brand is strong enough to survive if the allegations are proven false. “Unless there is firm evidence and a court order is passed, which is not in favour of Maggi, I don’t think it’s the death of the brand,” he added.

     

    Pertinent to note here is that all FMCG products especially food items go through stringent manufacturing processes as well as government approvals. Blah is of the opinion that it never hurts to be extra careful and hence the Maggi fiasco should serve as a wakeup call for other FMCG giants.

     

    While there have been discussions about the nutrition value of Maggi for years now, it hasn’t really hurt the brand and Nestle India has gone about producing it without a hitch riding on its taste quotient.

     

    What’s more, with the involvement of big celebrities like Amitabh Bachchan and Madhuri Dixit as brand endorsers, the matter has been highlighted even more. It is a well-known fact that celebrities are soft targets whenever there is a controversy brewing.

     

    When queried about whether it was fair to drag celebrities into the controversy, renowned photographer and founder of celebrity management firm Bling! Entertainment Solutions, Atul Kasbekar said, “I believe it’s an irrational act to go after the endorsers. While stars and their managers question the brand fits and ask relevant questions at the beginning of any relationship, it’s unreasonable to hold an endorser responsible for episodes like this. Already contracts have strong two way indemnity clauses in place; I guess they’d be stronger now and spend more billable legal hours in the process. I cannot imagine that there’s a single celeb out there who would’ve declined a Nestle brand to be honest. I don’t imagine that’s going to change very much.”

     

    Concurring with Kasbekar, Blah said, “When a celebrity is endorsing a product, he is lending his name and his image to it. He is not involved in any other activity of the product. All he is doing is attracting eyeballs for the brand. If he were involved in the making of the product, then it would have been justified. But after they endorse a finished product, one can’t hold them responsible. If one batch goes wrong then it is not the celebrity’s responsibility, it is the company’s and the government’s responsibility as they have approved the product. It’s not fair to drag celebrities in this,” he said.

     

    Bijoor is of the opinion that the first thing that Nestle India will do is sort out the issue with the regulators and various states. “After that they will start addressing the consumer and that is when a lot of credibility building advertising will come from Maggi. Maggi is a highly evolved brand in India. They need to communicate with a different degree of tenacity with the consumers and they will do that,” he voiced.

     

    While celebs have been a part of the controversy, Bijoor thinks that the first thing celebs will do and have done in the past is to indemnify themselves from any collateral damage that the brand faces. “Without doubt they will be more careful and diligent henceforth,” he added.

     

    Will this one controversy also open doors to other and put other brands under the scanner? To this, Bijoor said, “This is just one category. If you look at the other categories like tea, frozen food, fresh vegetables, fish, poultry and meat that we eat; you will be shocked to find that the content of chemicals and metals is much higher than permissible limits across the world. So this is a major reaction on Maggi. This paints the entire industry with the same brush.”

     

    Sharing her thoughts on the controversy, PromaxBDA Africa and Asia Pacific country head Rajika Mitra said, “For the brand Maggi, it has created a huge setback and for Nestle, the brand integrity has been hugely impacted. The brand image of Maggi has witnessed a major dent in its popularity.”

     

    Mitra further added that Nestle would have an uphill task to build customer confidence and re-launch the brand in a completely new avatar, which might take years.

     

    “Celebs have been drawn into this controversy in a big way. Big brands and celebrity associations have always been a popular feature and they do feel responsible for the brands that they accept and endorse. Henceforth, they will be more cautious when accepting such brands in future,” she said.

     

    It may be recalled that as part of its damage control exercise after the worm controversy, Cadburys India came up with new packaging, which would keep the product fresh and intact without refrigeration. However, it is a known fact that chocolates need to be refrigerated, the question is: Why did Cadbury wait for the worm controversy to change its packaging?

     

    While Kasbekar believes that this controversy will be a blip in the progress of this superbrand, the fact remains that the communication path that Nestle India will have to take for brand Maggi following this unprecedented controversial blaze will no doubt have to be powerful enough to dowse the flames.

  • Hit at the box office, flop on TV

    Hit at the box office, flop on TV

    From Anurag Kashyap’s Yudh for Sony Entertainment Television (SET), Ashutosh Gowariker’s Everest on Star Plus, Vipul Amrutlal Shah with Pukaar – Call For The Hero on Life OK, Anil Kapoor’s 24 to Sanjay Leela Bhansali’s Saraswatichandra on Star Plus, the small screen has always welcomed big filmmakers with open arms. However, it is a different story that not many of them have been able to make a mark on television.

    Despite having deep pockets, the crowned kings of weekend box office, somehow fail to rule weekdays on television. Moreover, these were not your “typical Indian daily soaps.” With oodles of star power and mammoth production budgets, these shows took programming on Indian television to a different level.

    Producers are now pumping in more money in daily soaps, be it for grander sets, better special effects or skilled writers and directors. For instance, each of these episodes costs upwards of Rs 1.25 crore as compared to the normal budget of Rs 6-8 lakh for 30 minutes of fiction.

    Moreover, these handful of shows are attempting to push the fiction envelope in the Rs 43,000-crore Indian television industry today.

    Unfortunately, the production cost incurred by these shows fails to justify the visibility the shows garner.

    Let’s start with Yudh. This was one of the most talked-about shows of 2014 with Bollywood megastar Amitabh Bachchan making his television fiction debut on Sony. The show ran for four weeks, with five episodes a week. The estimated cost of the show, per episode, was around Rs 3 crore. While the channel promoted the property extensively, the buzz hit the rocks when it clocked an average of 1,199 TVTs in its opening week. The industry termed it as ‘dark’ content for the 10 pm slot on Indian television. 

    Similarly, Bhansali’s Saraswatichandra spent close to Rs 12 lakh per episode, little higher than what a fiction daily soap would spend. Though it started on a good note with 5,730 TVTs, it later lost track and the numbers fell drastically.

     After Bhansali, Star Plus brought Bollywood filmmaker Gowariker back to the small screen with Everest. Touted as one of the most expensive fiction shows, it was shot at locations like Nepal, Uttarakhand and the Dokriani glacier. With technical equipments like GoPro cameras, 4K technology etc, the production cost per episode was around Rs 35 lakh. The channel had pinned high hopes on the show but it failed to generate ratings as expected. It registered 2,845 TVTs in its opening week.

    Another show with a different perspective titled Pukaar had men as the main protagonists. Based on a story with an army background, it saw filmmaker Vipul Shah making his debut on television. Close to Rs 13 lakh had been spent per episode on production. Needless to say that Pukaar failed to call in the audience.

    While more often than not they’re armed with a magic formula for success on the big screen, why do these filmmakers’ high-budget television stint fail to bring in viewers?

    Indiantelevision.com spoke to industry experts to know whether Bollywood biggies have simply lost their way or have audiences grown tired of their particular brand of filmmaking?

    Media planners feel that no matter how much money a maker puts in, if the content doesn’t reflect the taste and preferences of Indian viewers, the show is bound to flop.

    Helios Media managing director Divya Radhakrishnan opines that television and movies are very different mediums. “In a movie, you get two hours to tell your story and a maker knows how to build it section by section. Television is 22 minutes in and out. How you can link the 22 minutes and have a 24-hour gap before you come up with next 22 minutes is important. So, there is a different knack of doing television, which is very different from movies,” she says.

    Similarly, Radhakrishnan believes that television makers can’t do movies. “Look at the mindset, for instance, from a hijack sequence in Diya Aur Baati Hum to a wedding scene in Yeh Rishta Kya Kehlata Hai, a viewer’s mindset is changing constantly. Assuming that a person is watching Star Plus end-to-end, this is the kind of graph that goes on television. However when you are watching a movie, a viewer, right from the first minute to the end of the three hours, is fully in tune with the character. Movie format is very different from that of television.”

    Another observer feels that film producers are so oriented towards movie making that they have to re-orient themselves for television, which is very difficult for someone of creative caliber like Gowariker, Bhansali etc.

    “It’s not about a show doing well or not doing well, but when BARC rollout happens, the benchmarks are going to change. The mindset of a Baalika Vadhu viewer will be different from that of a Yudh viewer,” adds Radhakrishnan.

    Concurring with Radhakrishnan, a media analyst feels that the grammar of storytelling on television is different from films. “On the big screen, filmmakers have support of huge stars, which is one reason for the film doing well. On TV, big filmmakers will definitely have the money to pump in but no big stars, which can back them up with the content they deliver. Shooting at exotic locations and increasing production cost are not necessarily recipes of good content.”

    Argue that Yudh failed to make an impact on viewers despite having probably the biggest star there ever has been in Bachchan and the burden of failure immediately falls on the frail shoulders of content, which invariably is king.

    Another point to factor in here is the crew that works on the production. A media analyst feels that by getting the crew that works on films will not necessarily work on television. “The way creative people think for movies and television is way different. You can’t get the same set of film people to write or direct for television,” the analyst opined.

    From a purely demand and supply point of view, mainstream watchers do not look for intellectual content after a day full of hardship. “They just want entertainment, which Yudh failed to deliver,” opines a top executive of a production house. “After full day of work, who would want to watch ‘dark’ content? What one needs is good content, which can de-stress the mind.”

    Another observer believes that in the US, TV series form a substantial market for various studios, and it is taken quite seriously by all participants like studio, writers, producers, director, actors and the audience. “In India, the television industry is yet to achieve that status. For this to happen, the content and formats on Indian television needs to witness a sea change.”

    While one has caught a glimpse of this change wherein big-budget shows like 24, Bigg Boss, Satyamev Jayate and Mahabharat have worked, the fact remains that such shows are far and few. A media planner says, “Why is it that these high-budget shows worked on television? It is because the content directly clicked with the audiences as the makers understood what the audience of today wants.”

    Offering a different take, a Hindi general entertainment channel (GEC) executive says, “The target audience for most Indian TV shows is households that don’t prefer watching anything sophisticated but only the typical serials. For many years, saas-bahu serials, in which Ekta Kapoor thrived, ruled the roost. Over the years, many other themes opened up like dance, music competitions, historical serials etc. However, in all these the inherent style remains the same, just the setting changes.”

    How important is time slot for the success or failure of shows? To this, Radhakrishnan says, “People chase good content. For instance, last year Colors filled up the 9-10 pm slot with two shows Beintehaa and Rangrasiya, which did average in numbers and less in viewership. Why didn’t these shows work in the primetime slot? However, now the channel airs Ashoka Samrat in the same time slot. The show has a very strong base and so it’s doing well. At the end of the day, it’s all about having good content.”

    A trait that people lack today is patience. Radhakrishnan argues that people are not patient nowadays and will go wherever they find content that appeals to them. It boils down to the game of content and the appeal it brings to the table. “Otherwise Saath Nibhana Saathiya at 6.30 pm and Yeh Hai Mohabattein at 11 pm wouldn’t be the top rated programmes in the genre. Similarly, Diya Aur Baati Hum for a very long time was the top rated show on the TAM TV ratings chart. However, the last four weeks had a different story to tell when the numbers dropped drastically with the show losing its numero uno position. Thus, to get the audiences back, the show took a generation leap to bring it back on track. In the interim, KumKum Bhagya of Zee has become number one.”

    High production budget and big names don’t necessarily result in getting the eyeballs. So while Karan Johar may produce a show tomorrow starring Shah Rukh Khan and Katrina Kaif, if the content is not strong enough, be rest assured that the viewer is not going to lap it up.