Category: Ficci Frames

MUMBAI: The success of Star in India has not tamed James Murdoch’s anger nine years since he last addressed Ficci-Frames in 2002. The wrath against cable TV operators for not giving broadcasters their fair share of revenue still resides but the tone is subdued.

“India’s creative force is still a sleeping tiger waiting to be awakened. That is why the Indian media and entertainment (M&E) industry is at $15 billion instead of $120 billion,” said Murdoch who is News Corp chairman Asia and Europe.

Speaking at the 12th edition of Ficci-Frames here today, the junior Murdoch said digitisation of infrastructure is key to unlocking the potential of the creative sector. While India has 250 million homes out of which 120 million have some form of multichannel television, only 30 million are digital.

” With the cautious liberalisation of DTH broadcasting, the cork on the bottle was removed. Thirty million Indian families have responded. So today India boasts not one, or two, but a whole sector of 21st century digital TV companies. We all would do well to note that when it comes to first movers and innovators in this sector, none come from the cable fraternity. They all come from this new class. Grappling with the challenge of incumbency, the cable sector has too often failed to take into account the only constituency that matters: the customer.” 

India’s moment of greatest opportunity has arrived, believes the man who would love skiing the Himalayas.

“ When I spoke at Frames a decade ago, the government of the day was busily readying plans for the imposition of Conditional Access Systems. I argued then that it was hard to see how a top-down approach would achieve the desired effect. Today the market is showing the better way. We should embrace that – and step on the gas. The best way is to accelerate the liberalisation of digital broadcasting. This would allow greater investment as well as greater latitude for innovation … including vertical integration of content companies and satellite distributors,” said Murdoch.

He accused vested interests of resisting digiisation. “If it stays analogue, then those companies can keep their customers as captives. Indians are the poorer for this. They are denied access to content of their choice. The digital homes present on the other hand demand better services. That means companies have to act and you are seeing shopping channels coming in, high definition, content in local languages. You are also seeing the advent of 3D. In a digital environent the boundaries between verticals slides, be it print, television, movies. This offers the incentive to content creator to develop and sell products.”

The truth is that the industry today is moving faster than the politics. “Unfortunately, the analogue infrastructure is proving a drag. When competition is stifled by infrastructure, the scarcity of bandwidth drives the operator to price channel placement instead of investing in greater capacity. This makes things more expensive for the channel operator who has to recoup that higher cost out of advertising, spread ever so thinly across a fragmenting audience.”

He reminisced about Star in 1999 and 2000, when they made a choice to triple down here, in a marketplace they were sure had the potential to change all of their lives. “Not that it’s been an easy ride. We have had fierce competitors in the past and we have them today, and I anticipate even more in the future. I hope we have met them in the marketplace fairly – and a little fiercely too. To our rivals as well as our partners, I have only admiration for your work. And I believe that we are together at a time and place in history that offers us the chance to raise up something that the Indian people have not yet seen: a media sector that will be the envy of the world – and all the benefits that flow from that.

Murdoch said the status quo is also restricting innovation in the news sector. “This is unfortunate as Indians are an engaged audience. There are investment restrictions in the news space. So the Indian voice in global affairs is diminished.”

As digitisation needs funding, Murdoch pushed for a relaxation in investment and ownership regulations. Digitisation, he believed, would unleash a content revolution in India.

The second area Murdoch stressed on is the need to bring Indian creators, storytellers, and journalists to the world’s conversations. This can only be done by ensuring that India’s creative market is competitive at home.

“My father says that no country has a monopoly on creative content. “Allow the new generation of Indians to reap the rewards of their success and enterprise. Encourage them as they build a creative sector that reflects the passions and energies and beauty of this incredible nation. If we do, we will find not only that India will have changed, but India will be changing the world,” said Murdoch.

Indian entrepreneurs, riding on a KPMG report that forecast the media and entertainment industry to almost double its revenues to Rs 1275 billion by 2015, should feel encouraged as Murdoch described global media firms to have grown “grey and tired” while their Indian counterparts were “young and eager”.

MUMBAI: The Indian advertising industry is set to grow at a CAGR of 14.1 per cent to touch Rs 426.9 billion in 2014, says a recently released Ficci-KPMG report.

The report notes that amidst an uncertain economic environment and low industry sentiment that prevailed in 2009, the Indian advertising industry managed to almost sustain its media spend levels of 2008, falling marginally by 0.4 per cent to stay at Rs 220.3 billion (Rs 221.2 billion in 2008) for the calendar year.
 
With the market picking up in the second half of 2009, the advertising industry is expected to grow by 12 per cent in 2010 to reach Rs 246.9 billion.

“While the worldwide advertising forecast for 2009 was estimated to fall by 5.5 per cent, Indian advertising revenues were not subjected to similar reductions. The marginal fall of 0.4 per cent was not pervasive across media platforms,” the report notes.
 
Television and Internet advertising managed a growth of 7 per cent and 25 per cent respectively, whereas other platforms registered a de-growth of over 5 per cent.

The year 2009 brought in focus on the bottom line margins and greater consciousness on discretionary spend amongst advertisers.

In segment wise distribution, television is expected to garner a greater percentage of the total advertising revenues and constitute the largest share of the overall media spend eventually.

While print continued to dominate advertising spend in 2009, it lost a fraction of its overall market share to other mediums. Despite a 4.6 per cent fall in advertising revenues, agencies continue to be bullish on print advertising in 2010 and 2011, the report states.

In 2009, with declining spot rates and an increased focus on market expansion, the total number of advertisers increased by 7 per cent on print and 11 per cent on television. Compared to 2008, both regional print and television gained a larger share of advertising volumes while national players marginally lost their hold.
Some interesting points in the report are that the advertising spends by Real Estate, InfoTech, Financial Services, Retail and Apparel sectors fell significantly in 2009 while that by FMCG, Telecom and Education are believed to have increased over 2008. However, the distribution of advertising spends across categories saw some shift. Several FMCG brands including Coke and Pepsi joined the online advertising platform.

Also, IT and Telecom players continued their digital spend while the share of BFSI sector in online advertising volumes declined. Education, which largely dominates advertising on print media, found coverage on national television and radio. The luxury segment which had until recently restricted advertisements to English newspapers and magazines, saw television and OOH campaigns for niche brands such as Mont Blanc.

For other Asian markets such as Singapore, Hong Kong, China, Japan and Philippines, advertising spend over the last few years has accounted for approximately 1.2 to 3.5 per cent of the GDP. However the share of advertising spends in India remained in the low range of 0.4 to 0.47 per cent. So, with India’s GDP expected to grow at nearly 7 to 8 per cent in 2010, the outlook for the year looks to be more promising with advertising growth returning to double-digit levels.

MUMBAI: There is a worldwide shift towards broadcasting on advanced, addressable and interactive platforms. While the session Transforming Television: from HDTV, Interactive TV, PVRS, VOD and Beyond brought points and counterpoints on to the table, there was clearly one theme emerging: that adoption of technology, particularly digitalisation in the Indian context, was beneficial for all.

The panel consisted of Bharti Telemedia Director and CEO Ajai Puri, South Asia Turner International India VP and Deputy GM (Distribution and Business operations) Siddharth Jain, NDS VP and Chief Marketing Officer Nigel Smith, Bridge Consulting founder and CEO Aline Rutily, Quantel director of sales (Northern Europe, Eastern Europe, South Africa and India) Richard Craig, Dolby Laboratories country head Pankaj Kedia and Intel Corporation global media and standards strategist Ravi Velhal. 
 
Smith started off the session with a presentation touching on how new platforms like High Definition (HD) and Digital Video Recording (DVR) had changed dynamics of the business particularly in the US and UK. According to him, a major push is expected in DVR penetration to the tune of 100 per cent of US households and 70 per cent of UK/European households.

Smith remarked, ”Companies that adopted HD in the US grew, while those who delayed in doing so were left behind in the growth path”, proving his point with figures, particularly citing the example of Comcast that lost 575,000 subscribers in one year due to delay in introducing HD TV. In the Indian context, he said, ”DTH will change advertising in India”.

Commenting on future market changes, Smith named addressable advertising (sending adverts targeted to the viewer group), advanced user interfaces and interactivity as game changers.

Demonstrating how technological advances may change TV watching and online interaction, Velhal quipped, “Computing, communication and content are converging”.
Rutily provided the French example, saying that IPTV had caught on quickly in France and that presently one out of four households in France have IPTV after its launch on 2002.  
 
The Indian digitalisation push found a strong voice in Ajai Puri. According to him, ”Digitalization is the buzzword for India. DTH will make people buy TVs”.

Puri said that the main hurdles currently were high tax and high cost of content. He pointed out the benefits of DTH saying that the medium gives “over 50 per cent revenue to broadcasters even though it (DTH) covers only 15 per cent of the households. If the system becomes addressable, broadcasters will make a lot more money.”

A fine balance was introduced into the discussion by Jain. He pointed out that broadcasters needed to spend significantly to bring forth the technological changes, christening the latest mediums “beyond television”.

MUMBAI: As the global economy eases, the recruitment and retention of good employees will become a primary concern for the media and entertainment sector.

Employees with flexible or multiple skills (within different sectors of media) as well as in-depth knowledge of each sector will have a cutting edge. The rise of new media will also lead to niche and entrepreneurial skills.

The scope of convergence of two or more media into one entity is gradually increasing. The changing complexion is evident from the growth of podcasts to IPTV, Wi-Max and newspapers with online editions. When the line separating the boundaries of each media becomes invisible, media organisations and their existing organisational structure are likely to undergo a massive change, depending on the need of the hour.

The quality of talent especially at the entry levels requires much focus. What industry players can come together to do is to help hone young talent by aligning with major media schools and providing specialised courses sensitive to the actual needs of the industry.

Furthermore, it is likely to help develop a better talent pool from which new candidates can be recruited, thus reducing the need for hiring people from other industries, particularly for managerial, sales and administrative positions. Media players could well afford to learn to
identify staff with a high potential and retain them.

Managing emotionally-charged talent and keeping them engaged with the overall organisation priorites requires that the talent management initiatives are customised to individual employees, a KPMG report said.

In an industry where the talent pool remains relatively small, hiring from other industries is also being followed by many media players. Whether it is such talent coming from other industries or new hires from media schools or lateral hires from competitors organisations, the companies who have met with success in customising talent and retaining them over a period of time have focused strongly on ensuring detailed and customised induction programmes for new hires.

Active participation in supporting different media schools and hiring from them is increasingly growing. The practice is starting to pick up but more media houses can afford to participate in it and make this a stronger custom by which the right talent for the right job gets effectively recruited.

Many of the top media players do have some kind of an HR Information System in place although the extent to which their HR practices are followed online or are standardised is still disparate. Appraisals usually do not take place online.

The development of HR policies and practices leaves much to be desired and it is likely to take sometime before the industry can have a fully automated system in place for all their HR functions and processes. There is a clear consensus among media organisations on following a well-structured HR policy framework and more importantly sharing that transparently with employees.

The talent management needs for the creative and sales teams have proven to be very different with both working with completely different career anchors and motivations. The nature of their work being opposite ends of the spectrum, many of the HR departments try to maintain a fine line between the creative vs. the sales teams. Showing too much inclination towards any one team could result in difficult situations. This is especially true while dealing with a dynamic and spontaneous industry like media, where creativity stems from thinking “out-of-the-box”. The HR heads of media organisations are increasingly developing talent management and retention programmes customised to the varied orientations of different employee groups.

The other issue regarding compensation in the M&E industry is the compensation benchmarking issues. Barring a few specific sectors like broadcasting, the M&E industry has still not adopted formal benchmarking of compensation and benefits which is a standard practice across other industries. By and large, there is a general tendency to be hesitant about sharing information, especially regarding compensation, so the salary structure setting comes from a general understanding of the industry and the informal ways of sharing information, the KPMG report said.
 

MUMBAI: The Indian gaming and animation industry has a long road to cover before it matures.

Creating a sustainable IP in India is not easy due to a lack of understanding and value for Intellectual Property rights. Manpower for mobile gaming technology is another issue that needs to be sorted out, said Synqya Games CEO Abhijit Jayapal.

India had traditionally been an outsourcing country, but this was now changing. The need was to find stories palatable to the rest of the world just as Disney and Pixar were doing, Krayon Pictures co-founder and CEO Nishith Takia said

Benjamin Grubbs, Regional Director of Turner Interactive Entertainment Network (Asia Pacific), said growth opportunities were growing in south Asia for gaming and animation, but the need was to come up with good stories.

A positive development has been the joining of hands by broadcasters and producers for making animation films.

According to Graphiti Multimedia COO Munjal Shroff, the time has arrived for animation filmmakers to move away from tales from mythology if they are to sell abroad.

Answering a question later, he said parental control and involvement of child psychologists was important as far as violent animation films were concerned.

Ranj Serious Games (the Netherlands) Managing Partner Michael Bas said games could be used for teaching, as it had been proved by some award-winning games introduced by his company. But new ways had to be found for distribution.

Children’s Film Society, India, CEO Sushovan Banerjee said it was unfortunate that for far too long, children had been seeing software not meant for them. The CFSI had, therefore, taken some children’s films to rural areas where these had been liked very much.
 

MUMBAI: The last ten years may be remembered as the glorious years for the Indian broadcasting industry, but concerns like creaking infrastructure, pressure on profitability, flawed measurement system, and the low level of innovation remain.

Star India CEO Uday Shankar said while speaking at the Ficci Frames that he believes the broadcasting industry will touch $10 billion in advertising while subscription revenue will be $5 billion by 2020, depending on how fast the industry cleans up.

Shankar started his keynote by citing a statement by the Supreme Court in 1995 on airwaves being public property. “Most people obtain the bulk of information on matters of contemporary interest from the broadcasting medium. Television is unique in a way in which it intrudes in our home… TV is shaping food habits, cultural values, social norms and the society in many ways,” the Court had said.

Shankar added that there are some positive factors that will lead to the growth of the industry, including the hunger for content, C&S penetration and DTH.

He said the viewing of Hindi general entertainment channels had increased 25 per cent in the last two years with the launch of four new channels and the average time spent had increased from two hours in 2007 to two hours forty five minutes in 2009. Though the figures are promising, these are still below the global average of 3.7 hours per day and US average of 5.1 hour per day.

“Approximately 50 million viewers from the D and E towns have been added in 2009. We have to know these consumers and cater to their needs,” Shankar said.

Shankar said gender myths are coming apart and more men are watching Hindi GEC, while more women are watching sports and convergence. 

On the DTH front, the industry has seen tremendous growth with 17 million subscribers being added in the last three years. The competition will push the cable to digitize faster and broadcasters will have non-linear and targeted delivery platform.

Summing up what the industry must do in the next 10 years, Shankar said investments should be made in innovation and differentiation across the value chain; scale should be build but not at the cost of loss-making monsters; direct connect should be created with the consumers and value unlocked in distribution; and industry should work together with the government to build a robust media environment.

MUMBAI: Union Information and Broadcasting Minister Ambika Soni today announced that a National Heritage Mission was proposed to be set up with a budget of Rs 6.60 billion which will plan the celebration of one hundred years of Indian cinema in a major way.

Addressing the valedictory session of the three-day Ficci Frames and answering questions later, Soni also announced that a sum of Rs 520 million had been set aside by the Planning Commission for the National Centre for Animation, Gaming and Visual Effects.

Soni also announced that every effort was being made to complete the Museum of the Moving Image being constructed in Mumbai by 2013 and steps had already been taken to approve the architectural plan.

Regarding Phase III for FM radio expansion, Soni said that the draft guidelines drawn up by her Ministry had already been placed before the Union Cabinet which was expected to been taken up shortly.

Even as she promised to come down on pirates of software with a heavy hand, Soni said no one could be permitted to ‘hijack the law of the land’ and prevent the screening of any film.

Ficci Entertainment Committee Chairman Yash Chopra, tennis star turned Hollywood filmmaker Ashok Amritraj, actor Vidya Balan, Dutch Consul General Marijke van Drunen Little, and Ficci Secretary General Amit Mitra were present on the occasion.

She agreed that it was unethical to charge VAT on the input and Service Duty on the output, and therefore had stated as much to Finance Minister Pranab Mukherjee. However, she promised to accompany a delegation of the film industry to meet him on the subject and expressed the hope that he will accept the demand.

In a clear reference to the attempts to stop the screening of Shah Rukh Khan’s ‘My Name is Khan’, the Minister said ‘self-styled moralists do not get legitimacy’ merely by using illegal means to put pressure on others. She said that the visit of Rahul Gandhi to Mumbai and taking a local train was meant to give a symbolic message in the same tone.

Soni said law and order was a state subject and therefore checking such forces or stopping pirates was a matter that could be looked into by the state governments. This includes preventing the pirates from getting hold of DVDs easily.

She said the Government was also moving towards amending the Cinematograph Act 1952 and the Copyright Act to help check piracy and bring laws in tune with changing technologies.

She claimed entertainment tax had been reduced in most states and it was not more than 40 per cent in any state.

She admitted that pirates took away the rightful earnings of filmmakers and she was committed to stopping that. A task force set up within the Ministry had been asked to give its report within six months, and a Group of State Information Ministers headed by the Andhra Pradesh Information Minister Dr Geetha Reddy had also been set up for this purpose.

She said that the entertainment sector had continued to grow even at the time of the recession and had, in fact, contributed to the growth rate of the economy.

At the same time, she said the Government was keen to expedite digitisation in the country to curb piracy, and the approval of Headend-In-The-Sky (HITS) policy was a step in that direction.

She said though Indian cinema had taken huge strides, it was still to make a major impact on the world stage. She said technological innovations and creativity needed to move together towards this.

She applauded Indian filmmakers for continuing to deliver social messaging through their films, and many like Vidya Balan also taking time off to do social work such as working for HIV Positive patients.

Earlier, Chopra in his welcome address raised the issue of service tax, piracy, and amendments to the Copyright Act.

Little said the Netherlands had set up Media and Entertainment India to collaborate with Indian entrepreneurs, since the Indian film industry was the largest growing in the world. She said the growth of creativity was unstoppable and there was immense potential for collaboration between the two countries. Fifteen Dutch companies had come together to form ME India, she said.

Amritraj called for giving the script writers – ‘the unsung heroes’ – their due if the film industry had to thrive, tackle piracy strictly, and put in more money to promote films overseas.

MUMBAI: Traditional media owners need to form a partnership with user generated content (UGC) sites to serve their consumers.

This was a point that came out at a session at Ficci Frames that looked at User generated Content: Seizing the Opportunity.
 
The speakers were Viacom 18 senior VP corporate strategy and business Anuj Poddar, NDTV Networks and NDTV Convergence CEO Vikram Chandra, Anand and Anand head of copyright and entertainment law Jagdish Sagar and Intel Software and Solutions Group director Asia Pacific Narendra Bhandari.

Balika Vadu, for instance, is one of the top viewed videos on Youtube in India, demonstrating how traditional media can pull new media.

Copyright, however, remains a challenge and there is a lack of value flowing back to content owners. Solutions, though, are evolving. UGC has set across norms, including the filtering of content that has a copyright. 
 
There is no distinction being made between user created and user generated content, notes Sagar. In the first case, the content creator surrenders all rights he has when he puts it up on a site. Many things can be done to that content like translation which the owner cannot control. In the second instance, somebody else uploads the content which the content owner may not be aware of.
The key to get out of this quagmire is to find a user friendly way to empower copyright owners. Sites like YouTube promote copyright infringement, Sagar notes. Getting an injunction is not a complete solution as it can only work for large content owners. One could look at a copyright society or having a licensing mechanism.

Dwelling on the opportunities and challenges of UGC for traditional media, Chandra said traditional media companies can get feedback and have user engagement which is what NDTV Social enjoys. There is also citizen journalism where news channels get tip offs and photos from disasters. But the challenge lies in finding a business model, Chandra adds.

NDTV has a channel on YouTube and there is revenue sharing for ads. However if NDTV content is uploaded outside this channel, then there is leakage that happens.

Bhandari noted that new media devices like the mobile would get smaller and smarter in the coming 24 months, allowing for HD level video to come from phones. UGC sites could benefit from an open source model technologically, he added.

MUMBAI: Ronnie Screwvala, the founder-promoter of UTV, believes in an integrated business model that is highly scalable. He also thinks addressing the youth will bring in big advertising monies as India is on the right side of the demographic shift.

The man who last year forecast that only one-third of the films produced would be released, spells out his 10 ‘game changing‘ commandments at the Ficci-Frames 2010 summit.

Mobile: 3G and 4G will be the game changers for the industry. The 80:20 revenue share arrangement between the telcos and the content providers, however, has to change.

Broadcasting: Screwvala said that keeping focus only on a single channel and not on a 360 degree approach would result in declining revenues. Such business model needs to be changed, he added.

Competition: Citing the example of movie business, Screwvala said that the industry needs to constantly analyse competition. The film industry will also have to counter the IPL window every year.

The dual approach of shortening the release window on DTH and PPV and home video can be some of the steps for tackling piracy, Screwvala said.
But he affirmed that there is huge potential for increasing revenues from movies as seven out of 10 viewers watch them on small screens.

Cable: There is lack of adequate investments into the cable industry and the last mile operator has been a problem since the last 20 years.

DTH technology has certainly changed the rules of the game as far as India has concerned. India will soon become the biggest DTH subscriber market in the world.

Youth: Mentioning the fact that youth constitutes the biggest section of the Indian population, Screwvala said that any offering has to be targeted towards this population.

Games: Gaming is still at a nascent stage and still not understood very well in India. Though it is a $40-45 billion industry worldwide, Asia, particularly Japan and Korea, have shown tremendous growth. He believe that with more serious efforts, gaming will be an important game changer.
 

Consolidation: A more liberal FDI policy would attract investments into the sector.

Scale: With only 3-4 big players, the size of the industry cannot increase. So scaling up will be a challenge as well as a game changer for the overall industry.

Subservient approach: Players need to change the submissive approach and work aggressively towards achieving their goals.

Consumer DNA: Indian viewers still don’t have the DNA to pay for the channels. This has come from 20 years of heritage. For the betterment of the industry, this has to change.

MUMBAI: The data revenues for mobile operators are bound to grow in the years to come with media consumption devices that are technologically consumer-friendly. However, operators have to find a way to monetize this.

This was one of the points that came out during a session at Ficci Frames. The speakers were Nokia India marketing director Vineet Taneja, Intel Global content and policy manager Gary Mittelstaedt, Turner International India director – wireless and interactive content development and distribution, (South Asia) Troy Lobo, Dolby Laboratories marketing director (Mobile) Rolf Schmitz, Tata Teleservices’ Pankaj Sethi, and Comviva VP (mobile content solutions) Milind Pathak.
 
Sethi said his company had just launched netbooks with high speed net access. “We are seeing more net led content being consumed and not just operator generated content”.

Lobo claimed that 10 per cent of Turner India’s revenues come from digital devices. This covers net, mobile and retail. The company is planning to launch SMS based alerts for CNN later this year. It is also looking at a news application. “The challenge is to fix standards for different devices. We adopt a multiple system of content distribution.” A deal was recently struck with Tata Photon+ for Pogo and Cartoon Network. Nokia, Samsung and Sony are some of the mobile device manufacturers that Turner works with globally. 
 
Mittelstaedt said that at the Consumer Electronics Show (CES) in Las Vegas this year, Intel had introduced the 32 nanometer product which offers more power to high end mobile devices. A point made at the session was that content for the mobile has to be contextual and relevant. It would be useful if there was a system through which someone could buy a film song for the mobile after seeing a film rather than just having a memory card. Intel also set up the App Up so that application developers have access to a broad product category.
It was felt that content publishers often do not understand the intricacies of what goes into building an app in India. There is not much expertise at the moment in terms of how one can publish TV content as widget in India. Some investment has to go into app developers. The lack of quality content is a reason for low Vas revenues at the moment.

Pathak said the depth of mobile consumption has to grow, and a buyer should be able to get Vas like music for a year along with the device. One should build apps that are exclusive. The mobile market should also be segmented according to spending and SEC. Even phones with a 2 GB camera, Facebook connectivity etc. could be considered.