ITV

Tag: Anuj Gandhi

  • ‘We are net positive in our deals with cable TV networks in the metros’ : IndiaCast Group CEO Anuj Gandhi

    ‘We are net positive in our deals with cable TV networks in the metros’ : IndiaCast Group CEO Anuj Gandhi

    IndiaCast Group CEO Anuj Gandhi is spearheading an effort to extract bigger pay-TV revenues from broadcast-carriage platforms as TV18 founder-promoter Raghav Bahl searches for growth engines that would propel his media empire to the top league of broadcasters like Star India, Zee Entertainment and Multi-Screen Media.

    Known both in the broadcasting as well as the cable TV world as CEO of Den Networks, Gandhi has already turned around TV18’s distribution business in the four digitised markets of Delhi, Mumbai, Kolkata and Chennai. “We will be net positive in our deals with the cable TV networks in the metros,” he says, after sewing the new commercial deals with the multi-system operators (MSOs).

    Gandhi is ready to reap richer harvests for TV18 as India moves towards digital cable TV. “We will be doubling our subscription earnings within three years,” says the man Bahl has spotted to shepherd the growth of IndiaCast.

    Correcting that is no mean achievement. For the full-fiscal ended 31 March 2012, TV18 Group paid carriage fee of Rs 3.5 billion against Rs 3 billion earned as subscription income from TV viewers through broadcast-carriage platforms.

    Hard bargaining over legacy issues including payment of carriage fees have held up agreements between broadcasters and MSOs with just nine days left for the shift to digital delivery of television channels in the four metros of Mumbai, Delhi, Chennai and Kolkata. But Gandhi is confident that there will be no shift in the deadline of 1 November for digitisation in the four metros.

    “We are entering a new era of television history in India,” he insists, with a smile and a twinkle in his eyes.

    In an interview with Indiantelevision.com’s Sibabrata Das, Gandhi talks about broadcasters‘ different nature of commercial deals with direct-to-home (DTH) and cable TV service providers, a drop in carriage fees, the need to correct “legacy loads” and the growth prospects for all the stakeholders in a digitised regime.

    Excerpts:

    Q. How can you say so firmly that there will be no shift in the deadline of 1 November for digitisation in the four metros?
    We are entering a new era of television history in India. The bad news staring at all of us today is losses, distorted business models and bandwidth constraints. If that is going to halt, the turnaround story for all of us will have to evolve around the digitisation script. The good thing is that all the stakeholders realise that hidden value will unlock only if we end the analogue cable regime. The government is also backing digitisation and has taken all the tough decisions. While Mumbai and Delhi are in full gear, we will know about the ground reality in Chennai and Kolkata as we hit the digitisation date.

    Q. But aren’t we just nine days away and all the commercial deals between broadcasters and MSOs are yet to be in place?
    While all of us are sighting a new dawn, we have a lot of legacy issues to correct. And this takes time. But it is only a few deals that are pending, a few knots that have to be tied. I don’t think this by itself will be a strong force to push digitisation behind. We have gone too much ahead to retreat.

    Even DTH had this dark cloud hovering around it in the initial days; Dish TV did not have Star channels when it launched and Tata Sky (a joint venture of Tata Sons and Star India) had to go without Zee channels in the beginning. We will have digitisation by the set date, with or without a few deals.

    Q. Is IndiaCast unable to lock the deal with Den Networks because of historic high carriage fees?
    I can’t comment on any specific deal. But in some cases there is a revenue mismatch between carriage payouts and the subscription earnings of a broadcaster. This may be due to legacy and involves a lot of negotiations to correct. We have done deals with all the other MSOs except Den (Anuj was earlier CEO of Den Networks). We are confident of sewing a deal with them in the next few days.

    Q. What kind of deals are being stitched? Has IndiaCast done more of cost per subscriber (CPS) or fixed fee deals?
    After rounds of negotiations, we have been able to work out most of our deals with MSOs on a CPS basis. But we are not stuck on any single formula. We are also signing fixed fee deals in certain cases.

    ‘There will be no drastic fall in carriage fees. While the TAM towns are rising, the number of channels are also shooting up. But in the digitised markets, we will see a good drop in carriage fees‘
     
    Q. Are CPS deals in IndiaCast’s case easier to ink because subscription revenues have been comparatively lower than the peer networks while carriage payouts have been higher?

    It has been easier to strike CPS deals because we have been late entrants. We are also at an advantage because we are the only major distribution company to have subscription and carriage under one roof. And as we inducted a new team (Anuj Gandhi joined in March 2012) in IndiaCast, the industry knew that we would seek a revenue-carriage correction.

    Q. Are DTH service providers able to do fixed fee deals while cable is moving more towards CPS arrangements?
    We are seeing an interesting trend emerge. DTH has been able to negotiate more fixed fee deals with broadcasters as they have a national satellite footprint. They can bet on their future subscriber growth numbers with some authority. And they benefit from this kind of commercial arrangement as the yield per box comes down in a fixed fee deal.

    Cable networks, on the other hand, are moving towards CPS deals as they address a finite market (city-specific like Delhi or Mumbai or Lucknow) and there is less chance of them growing horizontally (unless acquisitions happen or they compete amongst themselves to grab more territories). Though MSOs want to do fixed fee deals, broadcasters are not comfortable in forecasting the swelling in future cable TV subscriber numbers.

    As we move towards smaller markets involving small-sized cable networks in the second and third phase of digitisation, we would definitely see more CPS deals. These could later evolve into fixed fee deals as cable networks get a fix on what subscriber growth they would be able to register in future.

    Q. TV18 and Network18 on a consolidated basis earned about Rs 3 billion of subscription income while carriage payout was Rs 3.5 billion in FY‘12. Has IndiaCast been able to do net positive deals in these four metros?
    I can’t comment on the financials but we have corrected that legacy and are in a growth phase. We will be net positive in our deals with cable TV networks in the metros.

    Q. How much of the carriage fees the four metros account for?
    For the industry, these four metros would be accounting for about 45 per cent of the total carriage payouts. We would be in line with this trend.

    Q. How much of a carriage fee drop are we seeing in the four digitised markets?
    There will be no drastic fall in carriage fees. There are twin reasons for this. While the TAM (TV ratings agency) towns are rising, the number of channels are also shooting up. And in the digitised markets, we will see a good drop in carriage fees.

    Q. Raghav Bahl had earlier stated that TV18 would have to catch up on the subscription revenue front while the advertising income had reached a level comparable with the competing networks. What sort of pay revenue growth do you forecast?
    The industry will be able to post 20-25 per cent growth in a digitised environment as revenue leakages stop and the pay-TV market gets corrected. IndiaCast would definitely do better than that. We will be doubling our existing subscription revenues within three years. And when we say this, we are not factoring in any new channel that would be added to our distribution bouquet.

    ‘While DTH has been able to negotiate more fixed fee deals with broadcasters, cable networks are moving towards arrangements on a cost per subscriber basis as they address a finite market and there is less chance of them growing horizontally‘
     
    Q. Why TV18 group could capture a comparable advertising revenue after the launch of Colors while the distribution income stayed far behind competing networks?
    Advertising revenues are broadly reflective of the ratings that the shows get. The distribution business, on the other hand, is much more complex and a late entrant will take time to catch up. The challenge is to keep a fine line of balance between subscription and carriage. Growth is also heavily influenced by the ‘legacy numbers’. Digitisation, however, will help correct some of this ‘legacy load’ much faster than what would have been achievable in an analogue cable regime.
     

    Q. The company earns around Rs 300 million from its international content syndication business. What sort of a growth are you forecasting from this segment?

    We will double our revenues from this segment in three years. We will achieve this by expanding our reach and launching in more international markets. Colors already reaches out to 68 countries and we are looking at entering the South African market where we are in talks with the leading DTH operator there.

    We have just launched MTV India in the Middle East. We are planning to take that channel to other markets including the UK (the channel is already there in the US).

    We have also launched a new channel called Rishtey in the UK. The aim is to dig into the fast-growing free-to-air (FTA) market in the UK at a time when the pay-TV growth is shrinking.

    Q. With ETV clocking about Rs 1.1 billion of subscription income in FY‘12, how much of an advantage will the acquisition of these regional-language channels have in multiplying TV18’s consolidated pay revenues?
    ETV will give us a regional footprint, add depth to our distribution strength, help us penetrate the interior markets, and provide negotiating power to ensure that our network channels get carried in the smaller places.

    Q. Has the reworking of the joint venture distribution arrangement with Sun TV Network Ltd helped? Didn‘t TV18 taken the decision of directly handling the distribution of its network channels in the southern states (except Tamil Nadu where Sun distributes) because of the low pay revenues that it used to get despite the JV with Sun?
    Even now we share a good relationship with Sun TV. We distribute the Sun network channels in the Hindi Speaking Market (HSM) while the TV18 channels in Tamil Nadu are distributed by them.

    For the other southern states, we felt that we needed to take direct control of distribution. The fresh deal with Sun has indeed worked well for us.

    Q. Will IndiaCast want to add more channels or follow the OneAlliance model where size doesn’t matter?
    We don’t want to add channels just to get volume growth. We want to have the right mix of channels.

  • ‘Higher price cap than Rs 5 would have allowed us to play within that float’ : Anuj Gandhi – SET Discovery president

    ‘Higher price cap than Rs 5 would have allowed us to play within that float’ : Anuj Gandhi – SET Discovery president

    SET Discovery has been riding high on the wave of ICC cricket for over four years. Having the ICC Championship and World Cup in a single year, the company is targeting a 40 per cent growth in turnover to end 2006-07 at Rs 4.5 billion.

     

    In an interview with Indiantelevision.com’s Sibabrata Das, SET Discovery president Anuj Gandhi talks of the challenges digital cable faces and how the distribution scenario would shape up in future to impact the pay-TV broadcasting business in India.

     

    Excerpts:

    Are you happy with the way Cas has rolled out so far?

    We are terribly disappointed. The multi-system operators (MSOs) were not fully prepared. Their systems were not in place and there weren’t enough set-top boxes (STBs). Some operators were even providing boxes without smart cards.

    MSOs say broadcasters created an uncertain environment till the end by approaching the courts. Isn’t it true that they got very little time for actual preparedness?

    There was enough indication that Cas would happen. We were challenging the pricing and not introduction of Cas. Broadcasters signed their contracts with the MSOs on time. Some local cable operators (LCOs) who were against Cas, moved the courts but could get nothing in their favour. If Cas has to take off, this blame game has to stop. All the stakeholders have to play their role.

    Is it a case of low consumer demand for boxes?

    That is a separate issue and, if need be, can be tackled with different marketing schemes. We are in a situation where the MSOs aren’t quite ready. There is lack of information flowing into us, the subscriber forms have not been filled up, and in some Cas markets analogue signals are available of popular general Hindi entertainment channels in prime time.

    Why then couldn’t this market substantially move to direct-to-home?

    DTH is more expensive. It has a higher entry price and there is no big subsidy on the STBs. Besides, DTH operators took time to service this market. With cable operators not capitalising heavily on Cas, we have lost an opportunity to create a build up for a massive ramp up in demand for STBs at the time of the World Cup.

    Will the World Cup drive a 40 per cent penetration in STBs as predicted by some positive analysts?

    We see the World Cup acting as a catalyst and expect the STB penetration to touch 45-50 per cent in the Cas markets. Only when we reach that level can all the stakeholders make money. Already DTH service providers Tata Sky and Dish TV have announced their schemes for the World Cup. MSOs should also be sorting out their issues and coming out with a plan for the big event.

    Is SET Discovery targeting a revenue of Rs 4.5 billion in 2006-07 on the back of the World Cup?

    We have set an aggressive target this year and are going to hit it. We will benefit from key cricketing events like the ICC Champions Trophy and the World Cup. Besides, we had cricket on Ten Sports. For the first time, we would be capturing revenues from DTH as we signed up Dish TV and Tata Sky during the year.

    Will Cas affect the business?

    In the overall scenario, Cas has a very limited number of cable and satellite homes. Besides, Cas has come into effect only in the last quarter of the fiscal.

    Do you see broadcasters dropping prices of their weaker channels in a bid to push sale of STBs?

    With a price cap on a la carte channels at Rs 5, it won’t make business sense to further drop rates. The whole justification for this is to have higher volumes. But we could have got the current levels of box penetration with a more liberal pricing.
    ‘DTH growth for the last six months has been as we had expected. It is only digital cable numbers which have been disappointing‘

    Are you suggesting a price ceiling but at a higher rate?

    This would have allowed us to play within that float. We could have weighed the weaker channels, observed their relative strengths in the marketplace, and come up with a differential pricing while staying competitive. The whole subscription model at Rs 5 doesn’t give us scope for such pricing play and is unfair to niche channels. There is precious little that content providers can do and dropping prices would be bad for the MSOs as well. Besides, we haven’t yet got any billing data from the MSOs on the Cas subscribers to chalk out a strategy.

    Are you planning to take any action as the deadline has crossed?

    It should have come to us by 15 February, but we haven’t received any information from them yet. If we don’t get any feedback from them in the next few days, we will issue them notices as specified by the Telecom Regulatory Authority of India (Trai) in order to safeguard our interests.

    Trai is trying to push for voluntary Cas. How do you think this can speed up in other parts of the country?

    Digitisation is a reality but will take a while to happen. Cas has been a learning process and we have to evolve a phase-wise strategy for digitalisation. We have to fix a sunrise and a sunset date where we have to give adequate time taking into account availability of boxes, prices and investments by MSOs.

    MSOs are saying that broadcasters should be more understanding and not ask for more subscribers in voluntary digitalisation as the collection of money from the LCOs doesn’t improve. Isn’t entering into commercial agreements between MSOs and broadcasters crucial for the success of voluntary Cas?

    The analogue and the digital markets have to be distinguished. The MSOs can’t argue that they can’t recover money and so can’t pass it on to us. Then how will broadcasters make money from voluntary Cas? There has to be some incentive for broadcasters to push for digitalisation.

    In the newly notifuied Cas market, we are seeing a three-MSO play. Do broadcasters welcome such a strong wave of consolidation?

    There shouldn’t be a problem so long as the business is transparent. If there was one monopoly player emerging in the cable TV distribution arena, then it would have concerned us. Besides, the market is large enough for other players to emerge. And the independent operators who have aligned with the MSOs would continue to remain as franchisees. We don’t see them disappearing from the chain.

    Will carriage spread to new towns where Tam has expanded its reach?

    It is too soon to say how carriage will impact in Tam’s new panel. A lot will depend on how the channels are getting affected. The market has more or less stabilised. Broadly, however, as ratings towns get added, carriage will move there. But I don’t see budgets of broadcasters towards carriage really bloating. What would happen is that they would be picking and choosing the places where they want better placement and carriage.

    When do you see DTH significantly contributing to the kitty of the pay-TV broadcasters?

    It will take DTH a while for getting those numbers. But it has certainly started impacting the business because MSOs are having to think twice before blacking out channels so that they don’t upset their subscribers. And DTH growth for the last six months has been as we had expected. It is only digital cable numbers which have been disappointing, but we will soon see that changing too.

    SET Discovery will have no cricket to play with in the next fiscal while in the GEC space, Sony TV is dropping in ratings. How tough will it be for the company to post growth?

    Cricket, no doubt, is a big play in India. In a MSO market, you can still do with no big impact hitting us. But when you go down into the interiors, this is the only driver. We have grown rapidly for over four years on the back of cricket. We will try to maintain what we have and ask for realistic increases. But we have no channel as such that will make carriage on cable networks a problem; there is strength in our bouquet.
  • SET Discovery targets Rs 4.5 billion in FY07 on back of World Cup

    SET Discovery targets Rs 4.5 billion in FY07 on back of World Cup

    MUMBAI: Riding high on the ICC cricket World Cup wave, SET Discovery expects to garner a revenue of Rs 4.5 billion in 2006-07. This would mean a growth of 40 per cent in a tight subscription market with cable operators resisting any big increase in payouts to broadcasters.

    “SET Discovery is targeting a total income of Rs 4.5 billion in 2006-07. This will include for the first time income from direct-to-home (DTH) which should be contributing eight per cent of the overall kitty,” says a source in the industry who is close to the company.

    SET Discovery signed a contract with DTH service provider Dish TV in June 2006 and subsequently with Tata Sky.
    When contacted, SET Discovery president Anuj Gandhi declined to talk on the financials of the company. “We had set an aggressive target this year and we are going to hit it,” he said.

    Despite a slide in Sony TV’s ratings, analysts say SET Discovery’s growth in the fiscal would be greatly helped by a rich lineup of cricketing properties that include ICC Champions Trophy and the ICC World Cup.

    SET Discovery’s revenue stayed flat in 2004-05 but rose 15 per cent to Rs 3.2 billion last fiscal as it added Ten Sports in its distribution bouquet. Sony signed a distribution deal with the sports channel which has key cricket properties that include the Pakistan, Sri Lanka and West Indies boards.

  • ‘As an industry, we should support unregulated Cas’

    ‘As an industry, we should support unregulated Cas’

    SET Discovery president Anuj Gandhi offers his take on how the distribution scenario would shape up in 2007 in the wake of digital cable and direct-to-home (DTH) penetration.

     

    The year 2006 was when broadcasters consolidated their businesses and made money on the second bouquet. The incremental increase in revenues for distribution companies largely came from this.

     

    The combined growth in pay TV revenues was in the region of Rs 2.5-3 billion. This included the southern channels and later in the year Sun TV, the most popular channel in the region, also turned pay. Star One, which had problems in Mumbai and Kolkata, got established. We also made money from our second bouquet.

     

    Direct-to-home (DTH) also became a reality in the year. Though it took time, Star India and SET Discovery bouquets were available on DTH as rates became realistic.

     

    On the cable TV front, progress was made towards implementation of Cas (conditional access system). The Telecom Regulatory Authority of India (Trai) came out with more definite regulations and there was intervention from the various courts. Unlike 2003, Cas definitely is more structured and planned this time. It, however, remains to be seen in 2007 whether it turns out to be a success or not.

     

    The big story in 2007 would be DTHccccccccccccccccccccccccccccccccccccccccccccccccccc and digital cable. Pay broadcasters would expect to net Rs 3.5-4 billion from DTH and the bulk of it would be incremental without eating into cable TV.

     

    We should see deals being struck on all addressable platforms. Digital cable, voluntary Cas, Headend-In-The-Sky (HITS) should all become a reality and make economic sense to distribution companies like us. As an industry, we should support unregulated Cas. Things will take time to settle down till digital gets in mass volumes.

     

    The big problem area should be a la carte pricing, but I don’t see channels deciding to price themselves individually below Rs 5. We would also see bouquets emerging in the Cas areas. It won’t be easy for consumers to forget the channels that they were receiving for so long. Family packages, properly priced, should take off. Pricing and a lot of other things, though, will depend on volumes.

     

    Equations will change in carriage payouts to multi-system operators (MSOs). As ratings towns get added, carriage will move there. And these towns would not have a digital story. But I don’t see budgets of broadcasters towards carriage really jumping. What would happen is that they would be picking and choosing the places where they want better placement and carriage.

     

    IPTV will see trial runs in 2007 but the commercial launches should happen only a year after that. All in all, there will be lot of changes in the marketplace in 2007.

  • Tata Sky launches DTH service; STB price Rs 3999, basic subscription Rs 200

    Tata Sky launches DTH service; STB price Rs 3999, basic subscription Rs 200

    NEW DELHI/MUMBAI: Tata Sky Ltd, the $ 500 million joint venture between Tata Sons and the Rupert Murdoch-owned Star Group, today officially announced its arrival as India’s second DTH platform after Dish TV.

    Tata Sky is kicking of its service in 300 cities at an “introductory” monthly subscription of Rs 200 for the 55-odd channels it presently has on the platform.

    Price: hardware+installation Rs 3,999
    Monthly subscription: Rs 200
    No. of channels available: 55+
    Present area of service: 300 cities
    1st year target: 1 million subscribers
    Investments made till now: over Rs 25 billion
    Most critically, the Tata Sky set top box (supplied by News Corp owned NDS)
    has been priced at Rs 3,999 (inclusive of taxes). This includes installation
    and hardware cost and a full service warranty for one year.

    However, along with the monthly subscription of Rs 200, the Tata Sky offering will be more expensive than rival Dish TV’s package.

    Tata Sky CEO and MD Vikram Kaushik with Tata Sky chairman Ishaat Hussain
    Click here for a slideshow
    The Subhash Chandra-owned Dish TV is priced at Rs 3,290 (inclusive of taxes). This includes the cost of the STB as well as three months’ subscription. The monthly subscription for the basic Dish TV service of 75 channels is Rs 180.
    Announcing the launch at a glitzy event in Delhi where the likes of cricket commentator Harsha Bhogle rubbed shoulders with Mandira Bedi, Tata Sky MD and CEO Vikram Kaushik grandly proclaimed, “Entertainment will never be the same again.”

    Going on to harp on the state-of-the-art technology and finesse of the service, Kaushik added, “It’s a technological innovation that’ll bring the senses alive.”

    Apart from the many channels on the Tata Sky platform, a conspicuous absentee is the Zee Turner bouquet of over 20 channels as an agreement between Tata Sky and Zee Turner Ltd has not yet been concluded.

    Kaushik admitted that negotiations have not been concluded, but was hopeful that “things would get sorted out soon.”

    Another major absentee is the Sun Network, which dominates the South Indian markets. Tata Sky is, however, not alone in this, since Dish TV does not have access to the Sun channels either.

    “We are offering 55+ channels at the moment and with the passage of time the number of offerings would grow,” Kaushik said.

    The channels presently available on the non-tiered Tata Sky platform include all the channels from the Star (17), Sony Discovery One Alliance (14) bouquets as well as ESPN Star Sports and two channels of NDTV as its key offerings.

    It is worth noting here that it was only this morning that the deal for the carriage of the One Alliance channels by Tata Sky was signed and delivered.

    Confirming this to Indiantelevision.com, SET Discovery president Anuj Gandhi said the pricing terms was similar to the one signed recently with Dish TV.

    One Alliance is being paid around Rs 38 per subscriber by Dish for its channels. The deal is a five-year one that is extendable at the end of it, Gandhi revealed.

    Also available on the Tata Sky platform would be some Doordarshan channels as well the likes of Times Now, Aaj Tak, Headlines Today, etc. Some interactive and specially designed movie channels have also been thrown in as a sop.

    The Tata Sky service, Kaushik claimed in the presence of his company chairman Ishaat Hussain, has been designed to give subscribers “choice, control and convenience” in the way they want to watch television.

    A host of interactive services such as an on-screen programme guide, Actve Sports, Actve Star News, Actve Newsroom and Actve Khabar are also on offer.

    To offer maximum convenience to subscribers, Tata Sky has set up a pan-India distribution network of popular consumer electronic stores and mobile phone outlets for retailing its hardware and prepaid recharge vouchers.

    The pre-paid vouchers come in various denominations starting off with Rs 260.

    The company has also tied up with LG, ITC International Business Division and Indian Oil Corporation as part of its distribution drive.

    “We are looking at ramping up our activity and service over the next three months when the service should be covering the whole of India,” Tata Sky consumer marketing head Vikram Mehra said.

    The company has engaged a field force of approximately 3,000 people who will be complemented by a high-end 24×7 call centre, manned by multi-lingual customer service associates, trained to solve all customer problems.

    But Mehra was not forthcoming on the media campaign that’s about to break “soon”, except to say that it would be a 360 degree campaign using all normal media outlets.

    Tata Sky is an 80:20 DTH joint venture between the Tata Group and Hong Kong-based Star Group.

    The joint venture has invested over Rs 25 billion in the project till now, according to Kaushik, who added the target of 1 million subscribers in the first year is achievable.

    The unveiling of the Tata Sky service finally turns into reality a dream Murdoch has had since 1997 – of having a DTH platform in India