ITV

Tag: Ashish Mitra

  • ‘Our biggest challenge is raising the low yields in the Hindi movie channel genre’ : Star Gold GM Sameer Rao

    ‘Our biggest challenge is raising the low yields in the Hindi movie channel genre’ : Star Gold GM Sameer Rao

    Star Gold general manager Sameer Rao is known to be a numbers man. A chartered account and an MBA in finance, Rao has a 19-year career graph that spans stints in UBS and Arthur Andersen.

     

    His baptism in media took place at Star in cable TV distribution, followed by the internet, the commercial department and then finally to his current posting. He was given additional charge of Star Utsav in end 2009.

     

    Indiantelevision.com’s Ashish Mitra spoke to Rao about the changes he has brought at Star Gold and the prospects for the channels he heads.

     

    Excerpts:
     

    How large is the Hindi movie channel space? What is the lay of the land?

    Our estimates are that all the movie channels put together make it a Rs 5,200 million ad revenue market. No doubt, Zee Cinema is the leader followed by MAX, and we are at the No 3 slot. For about six to eight weeks every year, because of the IPL and cricket, MAX steals ahead and then it goes back to the previous ranking.

     

    Raising the low yields in this channel genre is the biggest challenge. The inventory is keeping on growing with new channels launching: UTV Movies, for instance, entered the fray with two channels. GRPs of movie channels used to be much higher a year ago than is the casenow. There are times the ratings race becomes a big issue with us when competing with the likes of GECs such as Sony, Sab and Imagine as they are in the same GRP range as us. But the realisations by these channels for commercial time are higher.

    Can you gives us your analysis of the Hindi movie channel genre?

    The movies genre, if you aggregate consumption across movies channels, movies on Hindi GECs and movies on cable channels, is as big as the Hindi GEC slice. However, perception wise, it is regarded as much smaller, possibly because it is acquired content as opposed to original programming.

     

    On the supply side, satellite buyers have emerged as key players in the Hindi film industry and are critical to the viability of any Hindi film project. With some changes both on the buying and selling side, it is possible that movie channels will be able to offer much more value to all stakeholders – film producers, advertisers, viewers – while remaining a healthy and profitable business for the broadcast networks.

    You were looking after commercial for Star Plus when you were called to take charge of Star Gold and Star Utsav. What was your analysis of the two channels and your health report for them?

    I was responsible for programming commercial for the Hindi language channels at Star between March 2007 and November 2009. I took over as Star Gold general manager in March 2008 and Star Utsav general manager in late 2009. Star Gold is a healthy and growing business and Star Utsav is stable but a lot more could potentially be achieved.

    What changes did you initiate at Star Gold to fast pace its growth amongst its competing players ?

    My fundamental approach towards programming on Star Gold was to build slots that delivered on a defined content promise to a movie consumer. The slots were developed based on research inputs on content themes that audiences wanted to see on a movie channel.

     

    Thus, we built permanent action, comedy and kids slots apart from the Hollywood dubbed slot, which we had launched several years ago.

     

    Apart from this, we also incorporated slots for thematic movie festivals through the year, which would run from one to six weeks. For example, one of these, Sabsey Favourite Kaun, culminates in a big scale televised award show, India’s only audience polling driven movie awards.

     

    Hence, once we had the slots ready, we acquired movies designed to develop and grow the slots. All these initiatives helped us narrow the gap between us and the genre leaders.

    Star Gold was not being marketed aggressively. How have you changed this in terms of above the line and below the line activity?

    Marketing for the channel is in line with the programming strategy of building up slots and festivals. A lot of it happens outside Mumbai as our biggest consuming markets are Uttar Pradesh, Gujarat, Delhi and Maharashtra.
    ‘We are just four GRPs behind Zee Cinema and 16 behind MAX. If we do the right things we can overtake the leader.‘

    Your list of acquisitions and syndications.

    Last year, we acquired films aggressively. We got the Salman Khan-starrer Wanted, the Amitabh Bachchan-starrers Aladin and Paa, the Akshay Kumar-starrers De Dana Dan and Housefull and the Ajay Devgn-starrer Atithi Tum Kab Jaoge. Besides Wanted, all other acquisitions were on an exclusive basis. Some runs of Wanted have been reserved for Sahara because they co-produced the film. We also have the non-exclusive rights of the latest RGV film Rann along with Life Partner and Luck.

     

    As far as syndication goes, we continue to syndicate with Zoom and UTV Movies. But this exercise entirely depends on the type of films the other channel wants to have.

    What are your plans for Star Gold?

    We’d like to lead the genre by the end of this calendar year. The network is building the catalogue through a mix of judicious new and library acquisitions and we continue to refine our slot-based programming and marketing strategy. I believe we need to acquire close to 20-25 more movies over a period of time. We are just four GRPs behind Zee Cinema and 16 behind MAX. If we do the right things we can overtake the leader. Our challenge is to have the right mix of old films, new films and blockbusters. We can’t buy the most expensive ones only; otherwise the low yields could erode our margins.

    Which are the major category advertisers for the channel?

    FMCG continues to be the biggest category. We are an important platform for male brands because of our deliveries in that demographic. We get the bulk of our advertising resources from the package of festivals. Going forward, several new acquisitions that we have gone into will boost the advertising pattern of our channel.

    Please highlight the milestones of Star Gold over the decade.

    Starting off in 2000 as a classic movie channel, we showed black and white films. We then switched on to telecasting coloured films from the post 70s. Rapidly, we turned into a channel with a modern look in terms of popular and critically-acclaimed cinema.

    Then in 2002, we launched the popular Sabsey Favourite Kaun (SFK) that first started as an award show. Then in December 2006, SFK went international. The show’s popularity can be measured well as last year, we received a whopping 17 million votes through SMS and internet in addition to the physical votes we received from people to select their favourite stars. This exercise lasted for over a period of two months.

     

    As for showing Hollywood dubbed content, we have excelled in showing the latest Hollywood films and rank above all other channels.

     

    Going forward, we hope to see Star Gold as a channel that boasts of new Hindi films.

    What has been the change in the channel perception over the years?

    The first major change in our channel was when we changed from a classic movie channel to a channel that specifies in several genres as far as films are concerned. Based on this, currently, we have a higher proportion of viewers. Our channel is driven around comedy films and of course Hollywood films. We want to build on the perception.

    You took charge of Star Utsav in 2009. What was your assement of the channel then and what changes have you brought in?

    Basically, Star Utsav is a channel that caters to repeat content. After I took over, I found that there were more repeats of shows of two distinct genres – mytholology and kids programmes. This was of course in addition to shows from the Star network.

     

    After I joined the channel, rationalising the schedule was my biggest priority.

     

    And now, we are looking at various opportunities keeping the taste and preference of the semi urban and rural markets in mind and devising a new strategy for Star Utsav. This will be implemented in the coming months.

    What were the ratings of Star Utsav when you took over and what are they now?

    The ratings are the same now comapred to when I hadn’t taken charge. It remains stable.

    What about advertisers? Have they been attracted to the channel?

    There is a potential beyond what the channel is currently generating in terms of advertiser participation and we are looking actively to tap such an opportunity.
  • ‘We are considering an IPO’ : Venus Records & Tapes director Ratan Jain

    ‘We are considering an IPO’ : Venus Records & Tapes director Ratan Jain

    Venus Records & Tapes director Ratan Jain is a busy man, collecting box-office feedback from his new release De Dana Dan.

     

    Built on Rs 670 million with Eros as an equal partner, the movie is crucial to Jain‘s expansion plans. He is readying a movie with Priyadarshan and another with Abbas-Mastan after having stayed away from film production for a brief while due to an unrealistic rise in prices.

     

    Venus has one-third of its revenues coming from music. With a correction in prices, the company plans to swing back into acquisition of titles.

     

    Venus is also considering an initial public offering (IPO) to fund its expansion plans.

     

    The company expects to clock a revenue of Rs 1.20 billion this fiscal on the back of a big movie release and the music business.

     

    Cutting across his busy schedule, Jain speaks to indiantelevision.com‘s Sibabrata Das and Ashish Mitra about the need to be cautious in an overheated movie market.

     

    Excerpts:
     

     
    Why has Venus been slowing down on movie production and acquisition of music rights for the last couple of years?

    The prices skyrocketed and we decided to stay outside the ring. Some companies wanted to scale up and actors and technicians jacked up their rates to an unrealistic level. The movie industry went haywire. The same thing happened to the music industry. For the films that we released, we, however, kept the music rights. But it did not make business sense for us to acquire music rights at such inflated prices.
     

     
    Do you see the prices having fully corrected?

    They have definitely corrected to a large extent and things have come to some state of reality. But some actors and technicians are still looking at extremely high rates. Despite a fall in the cost structure, there is a scale down in the number of movies being produced this year.
     
     

    Venus has swung back into action with a big budget movie De Dana Dan. Has the co-production with Eros come at the right time for you?

    The movie is made on a budget of Rs 670 million and it is a 50:50 joint venture project with Eros. While Eros has kept the home video and international distribution rights, we have the India distribution and satellite TV rights. Baba Arts is handling the distribution for us. Early indications from the box office show that the movie is going to be a hit.

     

    Priyadarshan makes out-and-out comedy films. De Dana Dan also marks the return of all three protagonists of Hera Pheri – Akshay Kumar, Suniel Shetty and Paresh Rawal.
     

     
    Will this movie spur you to scale up particularly as it comes after a gap of more than a year since your last film Maan Gaye Mughal E Azam?

    Yes, Maan Gaye… released on 22 August 2008. And I rolled the shooting of De Dana Dan on 26 November last year, the day the terrorists struck in Mumbai. I remember when we were in a middle of a shoot, we got a call from a friend of mine that terrorists were firing at CST.

     

    As far as my film goes, we do a research of at least six months and then go in for shooting. This film has taken exactly a year.

     

    I don‘t see Venus doing more than two movies a year. We could also be doing smaller movies but it is difficult to market and release them. We have two projects in the pipeline – one with Priyadarshan in August and the other with Abbas Mastan.

     
     
    Will you go for a syndication model or sell outright the satellite TV rights for De Dana Dan?

    We are in advanced negotiations to sell the rights. Syndicating the movie to multiple broadcasters is good for channels but not for us. It takes time to recover money. And it has worked when you have big hits like Jab We Met and Singh is Kinng which can have many runs across channels. Syndication also works when you have a basket of films.
     
     

    ‘We expect to clock Rs 1.20 billion in FY‘10. Venus is not just surviving on movie releases. We have a strong music business. We also trade in satellite TV and video rights‘
     
     

    Have prices for satellite rights slumped this year?

    Prices have fallen compared to last year. Internal competition and entrants have spoilt the market. We had fictitious prices ruling the market.
     

     
    Has the downturn affected your revenues?

    There is no recession in the entertainment business. We clocked over Rs 1 billion last fiscal and are expecting to have a turnover of Rs 1.20 billion in FY‘10. Venus is not just surviving on movie releases. We have a strong music business. We also trade in satellite TV and video rights.
     

     
    What steps are you taking to boost your revenues from the music segment?

    Music accounts for 30-40 per cent of our total turnover. Besides mainstream Bollywood, we bring out music CDs of all kinds including ghazals, regional languages and bhajans. We are exploiting the digital and mobile platforms. A major chunk of our revenue comes from downloading.
     

     
    But you haven‘t been acquiring music rights aggressively in recent years?

    With the prices going berserk, we largely stayed out of it. But we have a vast library, holding over 3000 music titles. While 600 are film music titles, the remaining are non-film music titles.

     

    On the movie front, we have negative rights of 50 movies.
     

     
    Zee had shown interest in acquiring 60 per cent stake in Venus in 2006. What went against the deal?

    There were commitment issues. While at that time we thought of that as an expansion route for us, now we are not looking at such alliances.
     
     

    Are you looking at other ways of raising capital to fund your expansion plans?

    We are considering an initial public offering (IPO). We were not ready for a public listing then. Now we have taken the necessary steps. We could also be looking at a pre-IPO placement. But we haven‘t frozen our plans yet.
     
  • ‘Consolidation in the multiplex sector will happen when the real value of the business is captured’ : Cinemax India senior vice president business strategy Devang Sampat

    ‘Consolidation in the multiplex sector will happen when the real value of the business is captured’ : Cinemax India senior vice president business strategy Devang Sampat

    Cinemax India Ltd entered into the multiplex business with a cluster approach, concentrating on Mumbai and the Maharashtra market. Running a cinema chain with 76 screens, it has a load of 40 screens in Mumbai and 18 across rest of Maharashtra.

     

    The thrust now is to build a national footprint with focus on locations that would give it an advantage. The expansion plan is to have 300 screens over a period of three years.

     

    Facing a slowdown, the immediate task is to add 60 screens in FY‘11 with an investment of Rs 1 billion. Cinemax will also push digital technology and expand its gaming zones.

     

    Cinemax has plans to raise funds but is not in a hurry. Promoted by real estate developers, it has an asset bank and can leverage it to raise debt. The company has a debt of Rs 750 million and the debt to equity ratio is 1:2.

     

    Cinemax is not keen on film distribution as it is a risky business. But it is readying to enter into film production and is waiting for the right script.

     

    In an interview with Indiantelevision.com‘s Sibabrata Das and Ashish Mitra, Cinemax India senior vice president business strategy Devang Sampat says consolidation will take time as average occupancy needs to rise from 24 per cent to 32 per cent and profit margins improve.

     

    Excerpts:

     
     
    Cinemax had indicated earlier that it would expand its screens to 300 over a period of three years. Has the economic downturn affected the growth plans?
    There is a slowdown for all multiplex operators as the mall developers are not pacing up. We will be taking our total number of screens to 100, from 74 in the year-ago period (earlier guidance was addition of 40 screens during the fiscal). We have closed down three screens in Faridabad as the mall wasn‘t taking off. But we are not revising our three-year target of 300 screens.
     
     

    Are you scaling down your investments in the short run?
    For the current fiscal, we are investing Rs 600 million. We will be adding 60 screens in FY‘10 and our investment requirement is Rs 1 billion.
     
     

    Will you be raising funds for this?
    We will take a call in December. We are not in a hurry and will raise money when we need it. With the promoters being real estate developers, we also have an asset bank which we can leverage.
     
     

    Wouldn‘t you like to retire some of the high-cost debt?
    We have a debt of Rs 750 million. The debt to equity ratio is 1:2. There is room to leverage and we are not facing any fund constraints.
     

     
    Cinemax has concentrated its multiplexes in Mumbai and Maharashtra. Will the spread out now be more national?
    Initially when we ventured into the business, we took a cluster approach in Mumbai. Now during the course of our expansion, the focus will be on going to good locations. In the multiplex business, location is king.
     
     

    ‘We will definitely get into film production. We are ready and are waiting for the right script. We feel this will complement our exhibition business‘
     

     
    Will you look at acquisitions or you feel the industry is not ready yet for consolidation?
    The industry has an average occupancy rate of 24 per cent. Unless this goes up to 32 per cent, the real numbers don‘t come up. The profit margins stay low. Consolidation will happen when the real value of the business is captured. Being real estate developers, the promoters decided to foray into multiplex as part of their retail business. The capital cost for Cinemax will, thus, be comparatively lower and the promoters have a better understanding of locations.
     
     

    How could Cinemax achieve operational break-even during the quarter when film producers froze fresh Bollywood content to multiplexes?
    This was primarily due to three reasons. Our presence is predominantly in Mumbai and Maharashtra. Secondly, there were some Marathi films that released during this period and they fared well at the box office. Thirdly, we own some properties, reducing the impact of the expenditure on lease rentals.

     

    We expect to clock Rs 2 billion this fiscal, up from Rs 1.54 billion a year ago.
     
     

    But the first quarter turnover was weak?
    We expect contributions to come from the new properties in the third and fourth quarters. The existing properties should give us a revenue of Rs 500 million in each quarter. Don‘t forget that the Khans (Salman, Shah Rukh and Aamir) will make their appearance from the third quarter onwards. As for profitability, we will maintain the same percentage as the last fiscal.
     
     

    Do you see a change in the revenue mix in the near future?
    We expect the Food & Beverage (F&B) segment to contribute 20-22 per cent in FY‘11, up from 18 per cent. Advertising income should go up from 8 per cent to 10 per cent. Currently, box-office collections account for 69 per cent of our total revenues and gaming zone and others six per cent.
     
     

    Having entered into film distribution, is Cinemax also looking at venturing into production?
    We will definitely get into film production. We are ready and are waiting for the right script. We feel this will complement our exhibition business.

     

    We distributed two films – Kismat Konnection and Singh Is Kinng. We managed to break even. But this is a risky business and we are not keen on it.
     

     
    What are the digital steps Cinemax is taking?
    Digital technology helps reduce piracy and enables 3D viewing. This will lead to an increase in the share of Hollywood movies released in India and, in turn, to higher ticket prices. We have introduced digital technology in 24 screens.

     

    We are also looking at augmenting our revenues from gaming. We have introduced gaming zones in six places and are planning to expand it to our other theatres.
     

     

    Does Cinemax have plans to set up cinema theatres overseas?
    We have no such plans.