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The Indian Premier League (IPL) promises huge space for revenue growth. The team franchises will have to focus on building the brand consistently, project a healthy personality and take the sponsorship value to a different level.
It is not wise to draw sponsors just on the back of winning and losing. Performance is a factor, but it is not the only thing.
In an interview with Indiantelevision.com’s Ashwin Pinto, GroupM ESP managing partner Hiren Pandit says there is value in T20, but warns that it should not be at the cost of the other formats.
Excerpts: |
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How have the franchises fared financially in the second edition of the IPL?
In terms of sponsorship revenues between the team and central revenues, the IPL got Rs 3 billion. Last year it would not have been more than Rs 2.5 billion. Kolkata Knight Riders (KKR), Chennai Super Kings (CSK) and Delhi Daredevils have got the most in terms of local sponsorships, followed by Mumbai Indians, Kings XI Punjab Rajasthan Royals (RR). |
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And what about sponsorships? |
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How about defending champions Rajasthan Royals? RR has broken even because their payout to the BCCI is much less as compared to the others. They only shell out $6.5 million each year. Having said that, I am not so sure that finishing number one necessarily translates into higher sponsorship revenue. |
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Then what matters?
If an IPL team draws sponsors on the back of winning and losing, then you have a problem. Performance is a factor, but it can’t be the only thing.
While KKR did well in terms of getting in sponsors, somewhere down the line they or the brands associated with it made the mistake of going down the performance route. That is a dangerous platform to walk on. The amount of bad press it got did not help the franchisee nor the brands that were associated with it.
On the other side, Idea did an outstanding job with the Mumbai Indians. Their activation platform was brilliant and had nothing to do with winning or losing. It gave fans the opportunity to aspire to talk with their favourite players. Even though Mumbai Indians lost on the field, the aspirational value is still there. |
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What was Group M’s role in this IPL? |
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Do you see yourself playing a bigger role going forward? |
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The IPL is looking at doing another event each year abroad, possibly a smaller one. Is this the best way forward? |
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Where does KKR go from here?
Secondly, they had too many people like Buchanan and Ganguly trying to become high profile. The bigger you are, the harder you fall and that is what has happened.
Kolkata’s sponsorship is on the back of Shah Rukh Khan and not because of the team. They could rejig what their brand stands for – and then sponsors will come in for the team’s values. That is a call that they will have to take. What you will find is that franchisees will move away from performance as a platform for brand activation.
Going forward, the growth of revenues will come from local sponsorships – and not so much from the central pool. If you are heavily relying on the central pool, then the franchise has not built itself properly. Building up local sponsorships and fan base will be key. |
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How would this happen? |
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There is talk that with the IPL the focus is shifting away from individual player sponsors and more towards team sponsorship. Are players like Dhoni going to lose out on lucrative deals going forward?
You could associate with a team to get national reach. If you associate with a player, it would be due to his characteristics. It is not necessary that the characteristics of the franchisees will be the same. |
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When the IPL adds more teams in 2011, what would be the likely cities?
Also keep in mind the fact that after 2010 all player contracts are up for grabs. The whole scenario will be reworked and changed. There should again be a cap on money that can be spent or there will be teams that will be far stronger than the rest. The IPL could then turn into a two or a three horse race which will take away from its appeal. Some deals, though, might be done outside the bidding. We will see more performance-related deals. Player loyalties and disloyalties will also come into the equation. |
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Next year England starts P20. In 2011 South Africa, Australia and New Zealand start a joint league along the lines of the IPL. How do you see this affecting international cricket?
Can the other leagues generate the kind of money that the IPL gets? I don’t know if Kevin Pietersen will get $1.5 million a year in those leagues.
Then you must look at it from a player’s perspective. He plays around 35 ODIs, 15 Tests, 20 T20 games a year. Does he have time to play anything else? Remember also that T20 is successful in India as it is a country sport first. Then it is a club sport. |
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Could we see players bypassing the international grind and just focusing on league cricket which is lucrative?
The players who did well like Kumble, Gilchrist and Hayden are seasoned campaigners who have excelled in the other formats as well. T20 is not a wham bam affair. It is about playing proper cricket. If a cricketer chooses league cricket over his country, then he might be asking for trouble. Most of the IPL players got there as they made a statement by playing for their country. Then there are youngsters who did well in the IPL and are now playing for their country. I do not think that it is a choice of one versus the other. |
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What impact will India’s exit in the T20 World Cup have on ESPN Star Sports?
Ratings will take a hit. Already we are seeing that clients are not getting enough of a return when India does not play. |
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How do you see the Champions T20 League faring?
You need to let it happen once. Some players play for two teams and so will have to decide where their loyalties lie when this event starts. |
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Would playing at night help Test cricket?
This is not a bad idea. What has happened is that T20 has had a positive impact on the other formats. The run scoring in Test matches is quicker which is forcing results. This is desirable. Each format lives off the other in some form or the other. |
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There will be lots of T20 cricket happening. Are you concerned that the overdose might kill the format?
It could lose its flavour. You cannot have too much of one format. There is value in T20, but it should not be at the cost of the other formats. |
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What challenges does the economic downturn pose for Group M ESP?
We need to work harder. We need to give more value to clients. It is a partnership in good times and bad. We need to find better opportunities for clients but it is not as though we need to think differently. |
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What progress has Group M ESP made in the celebrity endorsement and management space?
We have moved away from this. Keeping in mind the Indian mindset towards celebrities, we did not believe that it was a scalable model. We focus, among other areas, on branded content in film and television. The strike affected us but hopefully the films have only been shifted and not cancelled. We have done regional tie ups with brands. |
Tag: Ashwin Pinto
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‘All IPL teams should be able to break even by 2011’ : Hiren Pandit – GroupM ESP managing partner
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‘We are looking at localising further’ : Sunder Aaron – Pix business head
Pix is lapping up new movies to shed its image of being an English movie channel that showcases only classic films. Its most prize catch: Oscar-winning movie Slumdog Millionaire.
The channel from the Multi Screen Media stable, which is up against stalwarts like HBO and Star Movies, has been able to draw in a slightly younger audience base while having a wider age appeal.
Pix has also been flirting with sports properties to bring more sampling into the channel. It has been showcasing the FA Cup to grow its reach while trying to connect with brands to be constantly visible in the viewer’s eye.
In an interview with Indiantelevision.com’s Ashwin Pinto, Pix business head Sunder Aaron talks about the channel’s focus in content acquisition and its growth plans.
Excerpts:
How would you describe the progress that Pix has made since launching three years back?
We have evolved over time in terms of the schedule. In the beginning, we had mainly library films. Today while library films are shown, we air current films as well. While we are not the number one English movie channel at this stage, we are in the top three.How is the channel perceived in the market?
We frequently do dipsticks and studies from time to time to find out what is the perception of the channel. Data shows that we are skewed towards a younger audience. When we launched, we were viewed by an older TG 25+. Today, our TG is 18-44 years.Earlier, the perception was that Pix shows all classic movies. That has changed with us bringing in current films like Honeydripper, I’m Not There and Slumdog Millionaire.
Pix has focussed on building up a current crop of films this year. What strategy has been followed in this regard?
We focussed on bringing in current films without losing the premise of showing very good films. We have to remember that just because a film is new, it doesn’t necessarily make it good. Acquiring new films has helped boost our reach and increase sampling.Slumdog Millionaire is our biggest acquisition and this airs on 27 June. This kind of acquisition sends a positive signal to the market. We will also air a film called Push.
Is variety a factor in acquiring titles?
While variety is important, we find that the action and thriller genres fare the best. We buy from independent producers and distributors; we also source some content from the studios. Studios are already selling to HBO and Star Movies. While this is a handicap, we are able to find other suppliers and also do studio deals. This year we acquired films from NDTV, PVR, MGM, Icon, Pathe, SPTI and AMG.Our first and foremost aim is to find films that have good stories. We also focus on getting films with recognisable stars. Our aim is to improve the ratio of current films that we air.
In terms of pricing, what is the scene as far as English films are concerned?
With the economic slowdown, the entire industry has had to change their budgets. We are a smaller and specialised category. While pricing has not changed much, suppliers abroad are closing deals at lower prices just because they understand that channels might not be as successful as they once were due to the current economic situation.‘Acquiring new films has helped boost our reach. Slumdog Millionaire is our biggest acquisition. This kind of acquisition sends a positive signal to the market‘Has Pix been able to improve its viewership performance during the last six months?
We are looking to solidify our primetime slots as well as the afternoon bands over the weekend.During the IPL we adjusted our schedule so that we could catch the audience after they finished watching a match. This has done well for us. In some weeks, we could catch up with HBO and even beat Star Movies in Kolkata or Mumbai. But we need to be more consistent.
Are you refreshing the look and feel of the channel?
We are looking at refreshing the look of the channel. We want it to remain fresh and contemporary. We are encouraged at the response Sony Entertainment Television has received after its repackaging.Did the blackout of Bollywood films on multiplexes boost viewership of the English movie channels?
No! While viewers would have been at home, there are several viewing options. DVD sales went up.What programming innovations is Pix coming up with?
We are looking at localising further. We are examining two to three concepts that can further build our equity. We have had success with ‘Chicks on Flicks.’ Unfortunately, as not many films were released during the producers’ strike, viewership took a dip. Now that it is over, the ratings should pick up.What feedback have you received for the film review show Chicks on Flicks?
It has done well. In a lot of instances, the two hosts have not agreed with their assessment of a film. It is completely non scripted. The girls attend press screenings. They have a passion for cinema which is key in making the show work. We engage viewers by giving them references of the clips that the reviewers are talking about. Now our hosts are permanent invitees of studios who release films in India.Has Pix introduced thematic blocks to woo different audience segments?
While we have festivals, it does not pay off to have too many blocks. Then there is an inventory problem. If every Tuesday, for instance, you have a block dedicated to action, then you need to have enough movies in that genre. You could run out of content after a certain number of weeks and then start to duplicate.What could also happen is that viewers think that you only have a certain set of films to dip into. The English genre does not have much appointment viewing happening and blocks do not help in this regard. There is a lot of snacking that takes place.
So how do you build viewer loyalty?
Viewer loyalty is a challenge that all of us face, particularly film channels that are title driven. In general, you create an environment that viewers find attractive. Then you frequently deliver films that suit their taste.Would you look at dubbing and subtitling to boost reach?
No! Subtitling can distract the viewer. Many channels put incorrect subtitles illegally. They do not use the official subtitles from the supplier’s side. They may not have taken the permission of the film’s distributor to do this. If you watch some of these channels, you will see that the subtitling has been poorly done.Pix started airing soccer last year with the FA Cup. Given the escalating costs of sports rights, to what extent does it make sense for a niche channel to showcase such programming?
It makes a lot of sense. When you want to grow reach, you need to bring in special events. We have done things like concerts. The good thing about the FA Cup is that it is not soccer every week. It happens on one weekend a month. Then the timings do not disrupt our primetime schedule. Also, the TG is a fit. So we increase sampling for the channel.Are you looking at other sports events?
It has to be special enough to raise our profile. I am not actively going out there looking for sports content. We had aired a boxing bout with Oscar De La Hoya live a few months back.Should there be a block for A rated content?
It would be good if this was to come in. Frankly, it is a question the content code has to take a view on. We will have to see what the CBFC comes up with. Some other Asian markets are more relaxed in terms of what is allowed. Others like Malaysia, though, are stricter.What kind of marketing activities does Pix do to create awareness?
We do campaigns periodically around big properties. We will be pushing Slumdog Millionaire actively. We will have visibility in places like Planet M. We have also tied up with a hotel in Dubai called Atlantis. This will be in the shape of a contest and offers viewers the chance to live the life of a millionaire.The other strategy is to constantly connect with consumers. One way is to constantly spend a lot of money every month. A better way, though, is to tie up with brands.
We are looking at tying up with restaurants like a Firangi Pani or a Sports Bar. We have a tie up with DNA. We are trying to do something with The Times of India. We are also tying up with out of home screens at McDonald’s and Café Coffee Day where our promos run on a continuous basis. These will be yearly tie ups. We have a promotional deal with VH1. We are looking at one with MTV as well. To succeed we need to constantly be in the consumer’s eye.
What about tying up with studies to promote theatrical releases?
This is an area that we are increasing our focus on. This is not restricted to just what Sony Pictures is releasing on the big screen. We recently tied up with Fox for the release of Wolverine where we had clips and interviews. We also do contests around upcoming releases.The marketing, thus, is not just about films that we show. What we bring to the table when a studio wants visibility for a new theatrical release is much more than what a competing channel can offer.
How do you see new entrants like MGM affecting the scene?
The category is growing organically. Homes with television sets are growing by about 10 per cent. New channels are coming in, but the English film genre is about three channels – Star Movies, HBO and Pix. The rest of them are in a sort of jumbled up pecking order. MGM and Warner Bros, for instance, are coming in and spending money to get distributed.The question is whether they will make the necessary investments to do what it takes to become a leading player. It requires a sustained investment on all fronts – programming, marketing and distribution. I feel WB will really have to step up; their campaigns will have to be sustained across the country and not just in a couple of Metros.
What about the impact of the economic downturn on the genre?
Obviously we will have to be savvy with how we spend our marketing dollars and also our programming budget. There is at the same time a flight to quality. While advertisers reduce their budgets, the top channels in each category are the ones that are in demand the most.In a downturn you do not want to spread the money around too much. You want to go with what you know is safe.
On the ad sales front do you offer customised solutions in addition to spots?
We try to be creative at a time when clients want more added value. We have Fiama d’Wills doing a campaign in our 4 pm block on Sundays. We air films that target women in this block. We have also done stuff on the ground with clients.We recently did a ‘Hollywood Picks Your Brain’ initiative and ITC was a big sponsor. This was done across six metros and one could win prizes like ipods. We are now looking at doing a similar initiative targetted at media outlets.
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‘India is the only market where we pay carriage’ : Bruce Dover – Australia Network CEO
Australia Network, the international channel from the stable of Australian Broadcasting Corporation (ABC), has a hybrid mix of news, drama, lifestyle and kids programming.
The state-funded channel, which has an international presence in over 44 countries across Asia, the Pacific and Indian subcontinent, is planning to launch a kids channel for the pre-school and the 8-14-year-olds.
The expansion plan in India also includes introduction of subtitles in English and Hindi. Co-production deals are part of the agenda to keep in line with India as a focus area for growth.
In an interview with Indiantelevision.com’s Ashwin Pinto, Australia Network CEO Bruce Dover talks about how the hybrid programming model has worked in many markets. An old hand at media, Dover was Rupert Murdoch’s right hand man in Beijing. He went on to write a book titled Rupert Murdoch’s Adventures in China.
Excerpts:
Being a single channel broadcaster is a tough proposition. Are you planning to launch more channels in India?
The ABC is looking at an Australian kids channel. This would cover both pre-school and the 8-14-year-olds. The idea is to roll the channel out early next year. But this would depend on the funding that we get from the Australian government.The BBC made an entry into India after syndicating their content to the pubcaster. Do you have any such plans?
We have to be careful not to cannibalise our content. Otherwise you might want to start a kids channel, but find that you have already sold your content to other channels.How do you plan to grow in India?
We are planning to introduce subtitles in the fourth quarter of this year. Perhaps, this is necessary because of the Australian accent that our coverage would have. We are also looking at Hindi subtitling for our movies, dramas and documentaries.We already do subtitling in Vietnam. Indonesian subtitles have been introduced this week.India is flooded with strong English international channels. How would Australia Network make a mark in India?
Our speciality is that we are a hybrid channel with a varied programming mix. We have news and current affairs which make up 25 per cent. Then there is lifestyle and dramas, documentaries and children’s programming.Earlier the thinking was that TV channels fit single genres the best. International channels like NHK, though, are now following our model.
The lifestyle content is in terms of travel shows and what it is like to be an Indian student in Australia and vice versa. We have a show called Student Postcard where one learns about the good, the bad and the ugly of studying in an Australian university. Can you go out? Can you meet girls? You want to know if certain areas are safe to go out at night.
Our aim is to give Indians more insight into Australia. We do English language learning which is popular in India. This is for students who want to study overseas. We have programming as well as a site which helps you learn and become more proficient in English. Also, there is the cricket link. This helps drive interest in our channel.
India is a difficult market to get such a niche channel like yours distributed. How much is Australia Network spending on carriage?
India is the only market where we pay carriage fees. I can’t get into the specifics of that, but we are working with the Setpro team and they have good relations with the operators. We have a five-year deal with them.Almost 70 per cent of our viewership comes from the South. We are on the Sun Direct DTH platform. We are also available on several cable networks across the country. We have identified 15 towns where we want a sizeable presence.
‘Though the government funds us, the people of Australia support us. We fill up a void left by the commercial broadcasters in kids programming. Our news and current affairs content also does not carry ads‘Are you looking at co-productions in India?
It is one of the areas we are looking at. We feel there is a big opportunity here. You could get an Australian cricketer and an Indian cricketer coming together for a show. Factual content around interesting issues would be our area of focus.We are also looking at doing co-productions around children’s content. We have some IP software. We do kids science programming in other countries. The software and the textbooks can be recreated.
How many feeds does Australia Network have?
We have three. One is for the Pacific region, which is important as there are not many channels carrying independent news in this belt. Then there is one for North and Southeast Asia. A third feed is for South Asia. We are now looking to have a feed for the Middle East.Which are your key markets?
Indonesia, Singapore and Hong Kong are key markets for us. We recently launched in Indonesia and Malaysia and are satisfied with the progress we have made.India is also an important market for us. We just went through a re-branding process with the tagline ‘From Our World to Yours.’ It is about introducing Australia to India.
What was the aim of the rebranding?
We wanted to make it more relevant. We did work with Saatchi and Saatchi as they had the Tourism Australia advertising contract. They spent half a million dollars on research and focus groups as the contract was worth $40 million. We went to them to find out how brand Australia is being perceived in the market.How difficult is it to be a public service broadcaster when you have to depend on government for funding?
We only earn 10 per cent of our costs. The government funds us. The ABC gets its budget every three years. But the people in Australia have no problem with that. The ABC has a long history of producing world class children’s programming. There is an educational bent to it and we have shows like Wiggles. Besides, we do not carry ads, something which parents love. We fill in a void left by the commercial broadcasters.Our news and current affairs content also does not carry ads.
How has the global downturn affected ABC?
The current economic situation provides an opportunity for us as private networks scale back on their expensive dramas, news and current affairs. They are forced to focus more on studio-based cheap reality shows.Do you have plans for the digital space?
We will take this up as our focus area next year. We are looking at English learning applications. We will also provide news and current affairs video content on the mobile platform. -
‘As there is no clear No. 2 sport in India, NBA has an opportunity to take that spot’ : Emilio Collins – NBA senior VP international development & partnerships
Cracking the Chinese wall, the National Basketball Association (NBA) plans to break into the Indian market and become the No. 2 sporting power within five years.
Last week the NBA inaugurated a dedicated basketball court at Nagpada in Mumbai, the first in a series of courts that it plans to develop in line with its long term commitment to grow the sport in India.
For the first time, the NBA also opened up its live matches to the online viewers in India.
In an interview with Indiantelevision.com’s Ashwin Pinto, NBA senior VP international development and partnerships Emilio Collins talks about the other plans that the company has to grow the market for basketball in India.
Excerpts:
Could you talk about the strategy NBA has employed to grow its reach globally over the last couple of years?
Our strategy starts with media. This means getting television reach and forming partnerships with other digital outlets to grow the reach of the NBA brand. Post this, we focus on building the sport out. This is done by creating more basketball opportunities. We aim at providing more access to the game like infrastructure development.Which are your top five markets outside the US and where does Asia fit in this?
China is our biggest market. It represents 40 per cent of our international business. Over the last six years, there has been substantial growth in that market. Philippines, Korea and Japan are the other key Asian markets where the basketball population is very high.In Europe there is tremendous relevance in Turkey, Spain, Italy, the UK and Russia. A lot of our international players come from Europe and so the relevance is very high. Latin America is a big priority for us, especially Mexico and Brazil. We have recently started to look at the Middle East.
Did the NBA see good revenue growth last year?
The NBA is growing at a significant clip at 20 per cent a year. I cannot talk about numbers, though. Asia contributes a little over 50 per cent while Europe accounts for 35 per cent. Latin America makes up the rest.How much do television license fees contribute?
Media license fees contribute 50 per cent. This is followed by sponsorship and consumer products.Why didn’t you push NBA into the Indian market earlier and how big a market opportunity do you see here now?
The biggest challenge that we face at the NBA as far as our international business is concerned is how to size up opportunities simultaneously. We wanted to ensure first that we managed China correctly. A lot of resources went there.India is one of our focus markets now, along with the Middle East and Latin America. The emerging middle class provides a big opportunity for us here. Basketball can play a big role in the development of sports infrastructure. The appetite for sports and entertainment is growing which has been proven with the success of the IPL. The NBA also fuses sports and entertainment. The IPL has successfully tapped into this combination.
How do Indians perceive the NBA as a brand?
The brand value is very high. We are in the unique position where the best basketball players from around the world play in the NBA. So if you grow up and get exposed to basketball, you automatically aspire to be a part of the NBA. Our players are global icons and by the sheer nature of the presentation of our game, players become larger than life personalities and figures; they are fused into the world of pop culture and entertainment. This has enhanced the status of the NBA brand.How tough is India as a market for the NBA to grow, particularly since it is a one-sport nation?
This, in fact, marks an opportunity for us as we want to be number two. In a market where there is no clear number two, there is an opportunity for growth side by side with the number one sport that is cricket.Our strategy revolves firstly around building the sport. We want to provide more access to the sport through infrastructure development. Then we want to get involved with the community and develop activities around it with our local partners. We can use basketball as a means to contribute to the community. Thirdly, we plan to expand the reach of NBA Lifestyle and offer opportunities to fans to experience the NBA. This can be done through basketball competitions, interaction with players and most importantly through broader media distribution.
Where do you see the NBA in India five years down the line?
The NBA has a long-term development plan for India. Our goal is to make basketball the No. 2 sport in India in the next five years.‘Outside the US, China is our biggest market. It represents 40% of our international biz. Philippines, Korea and Japan are the other key Asian markets where the basketball population is very high. India is one of our focus markets now‘You have successfully grown the NBA in countries like China and Japan. Are there any learnings from that brand building process which you would want to apply to India?
We have learnt the most from China. It all starts with spreading the NBA brand through television. This is then followed up with on-ground activities mixed with community initiatives. To make a court for the Nagpada neighbourhood and make this the epicenter of social and physical activities for them would make a difference to the community. This is critical to all the markets where we operate.Secondly, we want to introduce the sport to new audiences. This means going into schools and teaching basketball fundamentals through a Junior NBA initiative. We also want to create participation. We can use the Nagpada court to have tournaments there.
We bring the NBA Lifestyle experience to the market. In the USA, we will be going into malls over the summer and bringing the experience to fans like slam dunk on a small court. One can play NBA videogames. You can meet NBA players and really feel the NBA experience.
Finally, we want to bring the NBA competition to India. We will bring NBA teams to compete in an exhibition game. But before doing this, the infrastructure in India has to develop at a faster pace.
How is the deal with Star Sports working out?
They have partnered with us for many years – in fact, since 1993. In addition to showing our games live on Fridays and Saturdays, they are also increasingly showing repeats during primetime. This is very important in terms of broadening the awareness of the NBA. We go beyond this by offering highlights and condensed programming that allow fans to connect.Then there is behind the scenes programming. We focus on what our players are doing in the community and on what our teams are doing day in and day out. We look at contributions teams make in their key markets. It is about capturing what the NBA brand is about in different markets across the US.
Is there interest from other Indian and Asian television broadcasters as well for the NBA content?
There is significant interest from other Indian and Asian television broadcasters for NBA content. We are in discussions with various local Indian media outlets to distribute our content in different ways to appeal to Indian fans.Does the NBA do a lot of tie ins for film and TV shows?
The NBA works with a variety of TV broadcasters and film studios to tie in the League’s content – from product placement to guest appearances by NBA players, etc. The NBA brand and its players are a significant part of pop-culture and films and TV shows leverage the League as a platform to reach its target audiences.Would this avenue be explored in India?
Integrating NBA content within TV and film is an important component in creating local relevance for our brand in India. We are developing strong relationships with broadcasters and film studios in India to showcase the lifestyle and pop-culture appeal of our League, teams and players. We have already begun to integrate with Bollywood. This past November, the NBA hosted two Bollywood stars – Lara Dutta and Dino Morea – for an all-access VIP weekend in L.A. NBA Entertainment documented their experience and produced a 30 minute program which aired on ESPN in India on Christmas Day last year.Are you looking at specials which can serve as value adds?
In a game played by LA Lakers, Dino Morea and Lara Dutta took part in many activities around the Staples Centre. We produced a half-hour special with ESPN Star Sports. We will do more activities like this down the road. It helps if that many Bollywood celebrities are fans of basketball. We can create shows on the experiences of Bollywood celebrities with the NBA.In addition, there are opportunities for reality-based content. There could be a talent search contest about finding the next great Indian basketball player. We are talking with ESPN Star Sports in this regard as well as with other platforms.
What kind of content does NBA offer on the mobile?
It is crucial in India as there are hundreds of millions of subscribers in India. We need our content using this platform. Photos, ringtones, wallpaper and then as 3G comes in, we would offer highlights. This will all be in addition to standard scores and statistics. -
‘GEC space will see turmoil this year’ : Rohit Gupta – MSM president (network sales, licensing & telephony)
2 009 is expected to be a rough year for all in media. Television is no exception. With the stockmarket collapsing and balance sheets getting battered, advertisers have become cautious and the current quarter is expected to be extremely choppy. Multi Screen Media president (network sales, licensing & telephony) Rohit Gupta concedes that clients are consistently assessing the environment and signing quarterly deals as against the annual ones earlier. He, however, is confident that Sony Entertainment will ride through the stormy times on account of the strength of its network.
Indiantelevision.com’s Ashwin Pinto caught up with Gupta to find out about what lies ahead, the mood in the market, the importance of tentpole properties etc.
Excerpts:
How was 2008 for Sony in terms of revenues? What growth was managed over 2007?
It was a successful year for us. All our channels grew their revenue. Some by 25 per cent, others grew in the range of 10-15 per cent. The other success story was the IPL. We created benchmark rates for Indian cricket before the event had even started.This year is expected to be challenging with the recession. What impact will this have on Sony and the television industry?
As we move forward this year will present challenges. The key one is the meltdown. A client would cut marketing spends but television as a genre will still grow. We believe that television is the cheapest form of advertising in terms of the reach it delivers. TV gives you the best RoI and this is what clients focus on during a slowdown.Print and outdoor will take a larger hit but television will still grow. A recent report projected a 10 per cent growth which is fair. TV has been growing at 18 per cent over the last few years. While that will not happen this year, there will still be growth.
For the IPL what is the upside being looked at this time around?
We have established rates that are in line with what we had decided upon earlier. IPL will be a bigger property this year.Everybody including the franchisees have more time to prepare. Last time we just had 45 days to prepare. This year the hype will start after the auction ends. We will hold a meeting with the franchisees after 6 February to decide on the course of action to take. Also at the point of time there is no other major property on television.
So you are confident on the financial performance of Sony for the IPL despite the slowdown?
Yes! What happens during a slowdown is that the clients’ ability to take risks decreases. IPL is a proven property. There is no risk in being associated with it. People will put money on ‘sure’ properties. The IPL is one of them. Last time the IPL had an 80 per cent reach on Max.Have deals been closed?
Yes! However I cannot divulge any details. Some deals are for both the IPL and the New Zealand series that comes before it. We do not have category exclusivity this time around for spot buys.This allows us to access more brands. Last time the IPL was not tested. Exclusivity was an incentive that we had to concede. By not giving exclusivity we will ensure that multiple brands can co-exist.
But won’t it be a challenge to get many brands on-board in a difficult climate?
You have to understand that cricket’s cost rating per rating point (CPRPs) are still holding up. The reach of the channel is key. Max does not have this issue. So we are confident of getting the desired rates.I don’t think that the rates are a problem. The challenge will lie in the outlay that a client puts on IPL. So this time around we will have smaller packages. The number of clients taking spot buys will go up. One does not have to buy all 59 games. A company can buy for ten games at a stretch. There is flexibility.
Has the revenue split within the group changed over the last couple of years?
I cannot give any numbers. However our dependence on the large channels is not that high. AXN and Pix are growing substantially. Max is now a very big channel in our network.What is the clients mood like in general?
They are more cautious. They are adopting a quarter by quarter approach. They are not signing large deals for a year which used to be the case. For this quarter ending March, clients are being extra cautious. Companies want to show better results with this being the last quarter. So it will be tough.The key is to have tentpole properties that can be sold. You need to have a distinctive niche in the market. Clients want more accountability. As a broadcaster you need to be responsive and understand clients’ needs. You have to make sure that the client gets value back. Everything is not necessarily about a rate. The question lies in the effectiveness of the media buy.
Apart from IPL what are the other tentpole properties coming up for the group?
In March we are launching Operation Dikhla Jaye on Sony. This will be a directors cut where four of Bollywood’s top directors will produce shows for us. It will be a 13 week initiative and will be the first time that anybody has tried it in India. These are one hour shows. We have roped in directors like Madhur Bhandarkar, Mahesh Manjrekar, Vikram Bhatt. Then the IPL starts. Post that we will have re-launches of our big shows.In the GEC space are the new arrivals having any impact? Is the ad pie growing or merely getting sliced further?
There has been growth overall. But this year since growth will be restricted there will be some slicing of the pie. The GEC space will see turmoil this year. New players will come in and others will go away. GEC costs are huge and it is a question of who will survive. The like of Star, Sony, Zee will always be around come what may.New channels will come. They may be on top for a while but the fact is that nobody is on top all the time. Clients also look at networks as opposed to channels per se. They want networks which are strong enough to withstand pressure. They want networks that have the sustaining power to ride over the tough times. Besides that you need big properties which ensure that clients look at you differently.
Each of our channels is in the top four in their respective genre. Sab is number one in the second level GEC tier. Sony has managed to hold on to its share more or less. Other channels have experienced a bigger fall in the GEC space. We may not have many channels but what we have done is to focus on building them.
How has Sony built up its client relationship management efforts over the years?
Our focus has always been on giving value back to the client. We were the first to start a client servicing team four years ago. Then other channels started doing this. We work closely with brands to integrate them into our properties. This is how we add value that goes beyond just 10 second spots. Therefore even though there are days when ratings have not been what they should be the clients have supported us. The relationship with clients makes a big difference in terms of your ability to raise rates.Which categories will be affected in terms of TV advertising due to the slowdown?
If you look at it the categories most affected by the meltdown which are real estate and retail these are not big on television. Finance was not as big on television compared with other mediums. Auto companies are shifting budgets from print to television.Coming back to the cricket front the New Zealand tour is the first time that Sony will air bilateral cricket. How is this event being positioned for viewers and clients?
This is a full blown tour. India has not visited New Zealand since 2002. We lost very badly then and so this is a big challenge. There will be anticipation. In fact this is the Indian team’s biggest challenge after playing Australia twice recently.But isn’t the timing an issue as the telecast of the matches is very early in the morning?
The timings are good for the T20 Games which start at 11 in the morning. The ODIs start at around 6:30 in the morning. Test matches start earlier but they are not a big revenue contributor compared with the other two formats.How many sponsors are being looked at?
We have clients who are interested in both the New Zealand series and IPL. That would give them visibility from Feb till June. So we are doing special deals for them. Generally we look at six to eight sponsors.Are you also looking at doing long term deals with clients for IPL?
No! We believe that the IPL which is a big opportunity is better served through yearly deals. You have the option to re-look at things.IPL broadened the viewer base. Has the client base also grown for cricket as a result?
Yes! Godrej an FMCG company came on board. They do not associate themselves with cricket. Max New York Life came on board. It worked well for them. It was not the traditional clients that came on board. This year also you can expect to see some surprise companies coming on board. IPL after all changed the way TV viewership happens. It is not just the male TG that tunes in.Will the IPL be simulcast?
No! It will only be on Max. We did that with the Cricket World Cup in 2007 where some matches also aired on Sab. However viewership got disrupted and the channel loses share. Then it is difficult to get viewers back.When HBO left there was a gap created. Is Pix now starting to fill this gap?
Pix has made a lot of progress over the last couple of years. Pix started when there were already established players. Now it is competing. In some weeks it beats HBO. Advertisers have followed this. Pix is making investments in terms of acquisitions. The aim over the next couple of years is that in terms of ad revenues it can reach the level of HBO and Star Movies.It is pitched as a premium movie channel. It delivers in the 25+ SEC A, B category which is what a lot of marketers target. All the large brands are on it.
How come Pix decided to air soccer with the FA Cup?
The audience for it is similar. It is SEC A,B. We decided to offer viewers something new and extra. Matches air on the weekends and so the movie schedule is not disrupted.The other two major distribution bouquets have two English movie channels – a mass one and a niche one. Isn’t Sony at a disadvantage here with just one channel that does not have the latest offerings?
It does not affect the advertising side. Channels like MGM (which is in the Star Den bouquet) do not carry ads anyway and it is dependent more on a subscription kind of revenue stream.What is the roadmap forward for AXN?
AXN is doing well and has been growing at 25 per cent CAGR. You will continue to see local content. You will shortly see the AXN Action Awards. Each year you will have three shows produced in India.Does cost control become important in this environment though?
This is an area we always look at. It is something that we are always conscious of and it is not as if this area has suddenly assumed importance. For us it is business as usual. One has to see the returns more carefully though.On the licensing front how has business grown over the past year?
This was small four years back. However we participate more actively in trade fairs like Mipcom and we showcase more content in the form of formats there. Our shows are sold in European markets, the US. We took all our formats to Mipcom. along with other shows like Filmfare, Stardust Awards. The other aspect is the Hindi movie licensing business. We syndicate them wherever we have rights.Finally we are seeing channels advertise on rivals. What is Sony’s policy?
We do not advertise on competitors nor do we accept ads from them. We accept ads from kids channels, news channels as we do not operate in that space. But you will never see us air ads from a movie channel belonging to a rival network. We are not desperate for revenue. -
‘The mad race to get cricket rights has created a bubble’ : Venu Nair – WSG South Asia CEO
With the Indian Premier League (IPL) in its catch, the World Sport Group (WSG) is sitting pretty. Even as it plans to cash in on the new T20 format that is set to change the cricket economy, the sports marketing company has also set its sights on the growing popularity of soccer and golf.
In an interview with Indiantelevision.com’s Ashwin Pinto, WSG South Asia CEO Venu Nair unveils the dynamics of the sports business.
Excerpts:
How far has World Sport Group progressed in India?
When we set up our office in India two years back, we had a plan to establish a credible business over a three-year period. We looked at cricket, soccer and golf. We decided to develop each of them independently. Cricket and golf has grown phenomenally. However, with soccer it is still an uphill task.We changed our football outlook to a five-year plan. We own all the rights and work closely with the Asian Football Confederation (AFC), with whom we have been working since 1992. Our current contract runs till 2011. The fact that we have worked with them for so long to promote soccer across Asia speaks of the fact that we are long term players.
How have you grown the cricket business?
We have brought in professionalism into the management of the title and central sponsorship rights. We tell clients what they can avail of over a year. From a brand perspective it works, as they are able to plan forward. This gave us an entry into cricket at the highest level.During 2006, the BCCI’s sponsorship rights were available. We paid Rs 1.8 billion for it. Prior to us, these rights were vested with corporates and not with a proper sports marketing company.
How is this deal with the BCCI working out?
We work on a margin of 15-20 per cent. When we acquired the rights, we bought it at a premium. Two years down the line we have managed to stay at par with our revenue targets.Where are the opportunities for WSG in cricket other than the BCCI and IPL?
There are opportunities to represent other boards. People are looking inward into India and they see the job we have done for the BCCI. As far as IPL is concerned, we have aggregated the media rights and sold it outward.But aren’t sports bodies working directly with broadcasters?
Broadcasters are limited by the region that they want to serve. They often tend to sell the rights outside their interests to other parties. This puts the broadcaster into an agency position, which is not often a comfortable area to be in as it is not their core expertise. So, to say that sports bodies increasingly work with broadcasters is an anomaly.Fifa, for instance, works very closely with sports marketing agency Infront.
‘You will have to put higher monies on the T20 format and put the squeeze on Tests and ODIs‘WSG managed a coup with the IPL rights. What targets have you set?
We expect to start making money by the end of the third year. We have sold rights it to many territories including the US and Canada. We have let some territories sample the product like Sky in Italy. We sold IPL to the Southeast Asian countries including Singapore, Malaysia and Thailand.Are these deals long term?
We have sold everything with the ability to re-look at periodic intervals at the contract. We will see how it is working. It had to be a partnership model. The format was something new.How does the IPL build in club loyalty and sustain viewership interest?
Teams will have to build more local heroes. Catchment areas have to expand. If the IPL franchise owners treat it just as a balance sheet-led proposition, then it may not survive in the long run.The IPL will face competition from other boards. England wants to start a league in 2010. Australia, South Africa and New Zealand want to start a joint league in 2011. How does this affect the IPL?
In soccer different leagues like the EPL, Spanish league, and German Bundesliga are played at the same time. But the EPL is most watched. The IPL is a home grown product and has the first mover advantage. More home grown talent will take centre stage. Foreign players might want to play the IPL to shore up their revenues. They will then reach a stage where they might want to play in another league to enhance their skill. The player migration seen in soccer will happen here as well.But when other leagues come up, won’t some monies shift from IPL to them?
No! 100 per cent of the IPL revenues come from home grown clients. They want the local audience and so they will not invest in an Australian or an English league.In India sponsorship revenue is higher than ticketing revenue. In England it’s the reverse. However, a time will come in India where ticketing revenue will grow. Hospitality is another area which, if developed properly, can be a solid, successful revenue stream. Soccer clubs in Spain and England make a huge line of revenue from this area.
If the revenue potential is so strong, then why are owners already selling stakes so soon?
They are looking to sell a stake at a premium. They are not looking at funding their working capital needs.Will Test cricket and ODIs lose some of their lustre as T20 comes up?
That is the market reality. Next year there are around 120 games, which include IPL, T20 World Cup, Champions T20 League. And one would not have known about it two years back.You will have to put allocated monies on this new format and squeeze monies on the other two formats. Even from a viewer’s experience how many takers are there for a Test Match! The purists are in a minority. Cricket is now more about entertainment. T20 has taken that window; you can watch a game in three hours.
The PCB got $140 million for its rights. So isn’t there still value in the traditional formats?
In bilateral events, the icon series will get money. If it is India versus Pakistan, then advertisers and viewers will chip in. The whole value of the deal with the PCB comes from these two series that are present in the contract. At the same time, there is no guarantee that they will get the same value. They will probably get the same monies as in 2004 when India toured Pakistan after a long time.However, the acquisition costs have shot up. In advertising you may not see a corresponding incremental value as it could get diverted to T20. The escalation may not happen.
Is there a danger of some broadcasters going bust due to a huge escalation in rights fees?
Yes! Ideally, ad rates should double which probably is not going to be the case. The rights fee has gone up disproportionately due to the need for content in a calendar year. The challenge for broadcasters is to figure out where the business is going. You also need to take care of distribution. In India sports channels have to have a certain number of events in a year. Otherwise the cable operator may stop beaming you. Cricket is reaching a saturation level and there will be a tapering down of values.The mad race to get cricket rights has created a bubble that will eventually burst. For example, tennis went through this huge bubble a few years back. It also happened with soccer.
Broadcasters who have bought rights at high rates will have to sit down with their books at the end of next year and strike out the red. Market forces will pull prices down as the high price cannot be sustained. As a sports marketing company, I can bid a certain amount but if it is not in touch with the reality, then I stand to lose.
Sports bodies, however, have to realise that the value that sponsors attach to the older formats of the game will increasingly be less. A sports body, though, will not lose money as it will get transferred from one format of the game to the other.
Even the 2010 soccer World Cup rights went for a five-fold rise. Why?
You cannot underestimate the fact that soccer is catching up. This is especially the case in urban India which has been fed a diet of quality football from world leagues.The awareness of global soccer icons due to the media coverage is also high. This is why premier tournaments are time bound. It has the carnival atmosphere. People follow certain teams. Once people watch it, advertisers also want to be in on the action.
You wanted to do a league around soccer with AIFF and use the franchise model. What happened to that?
We worked on a plan around a year ago. We did not go anywhere because of a combination of reasons. Firstly there already exists a certain kind of league. The soccer development process in India is not as robust as it should be.If the AIFF actually chalks out a 20-year plan to grow soccer at the grassroots level and has a realistic target, it can work. It is not about sending the team to the next World Cup.
Cricket has been managed well at the administrative level. Cricket has also had periodic highs like winning the 1983 World Cup. This ensures that interest stays. After the 1950s, there has not been a high in soccer. Even followers of the sport do not have role models to look up to. If the AIFF comes up with a proper plan, then I am sure that there are enough corporates out there who are willing to invest.
Bharti Airtel has committed Rs 100 crore. If it is spent in the right manner, it will give you results in 10-15 years. But thinking about reaching the 2010 World Cup final is a folly when you cannot reach a South Asian tournament.
How has your work with the AFC been progressing?
It has done well. The Asia Cup is held every four years. The AFC Champions League happens every two years. Everybody plays it. Australia has come through. We work with the Australian Football Association also on their leagues. Australia reaching the soccer World Cup was a culmination of many years of work. The sport has been revived as the body had a long term plan.What activities does WSG do in Golf?
We acquired the rights for the Indian Open which is the most prestigious event. The deal is for six years and slowly we have been able to increase the prize money. The Indian Open is now a million dollar product. Next year we will add $250,000 more to the event.Our aim is to take the prize money to $5 million given the fact that Golf is slowly growing in appeal in India. Our goal is to develop another multi-million dollar golf property in the first half of the year. We want to have two Indian Golf events that occupy a prominent position on the Asian Tour calendar.
What is working in our favour is the fact that marketing managers today want to invest to reach different levels of the strata.
What are the plans in the player representation business?
In India cricket is intricately linked to player management. You cannot stay away from this. We figured that small entrepreneurs were running this business. There was no professional marketing company running athletes in India. To a large extent this is still the case.We manage Sachin Tendulkar. We have a five-year deal with him so that we can monetise his brand. Since Sachin has aged, we have moved away from brands that he was endorsing in the past. He is a family man; his core values are honesty, integrity and long-term commitment. That is why you have brands like Aviva, Royal Bank of Scotland and Canon. We are looking at brands that can go past his playing days.
Are you looking at more stars?
Yes, but a decision will only be taken after the second season of the IPL gets over. Player management is a tricky business. We have to be convinced that the player wants a long-term partnership rather than a short term money-making venture.What impact will the economic downturn have on the business of sports marketing?
There will certainly be an impact. What the extent will be is early to say. Numbers will get reduced by 15-20 per cent. It will depend on the extent that the global economic crisis has on India.We may have to look at our cost basis. We have to re-look at future acquisitions; we will have to work with experts to get a fix on what the economy might look like three or five years down the line before making another acquisition. Our buys will be made on the basis of market realities.
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‘IPL has aspirations to evolve into a major league like the EPL’ : Ravi Krishnan- Rajasthan Royals vice chairman
After succeeding in the first edition of the Indian Premier League (IPL), Emerging Media-owned Rajasthan Royals has big plans to develop the franchise into a global brand. Part of the agenda is to do a variety of lucrative commercial deals and break even before three years.
Emerging Media is looking at raising around $20 million by selling 10 per cent of its stake. The company is in the process of appointing bankers to find a private equity partner, ahead of an initial public offering (IPO).
In an interview with Indiantelevision.com’s Ashwin Pinto, Rajasthan Royals vice chairman Ravi Krishnan spells out the franchise’s future strategies.
Excerpts:
The IPL franchisees are said to have recovered close to 80 per cent of the money they paid to the Board of Control for Cricket in India in the first year. Does the huge success of the first edition of IPL mean that Rajasthan Royals will break even faster than the earlier three-year target?
We are revising our plans positively, though I can’t comment exactly on the figures. We spent less on acquiring the franchise and invested judiciously. We did not sign an expensive contract with a Bollywood star; nor did we spend heavily on advertising campaigns. I have never seen Chicago Bulls run an ad campaign; it is PR-led and builds value from the success that it enjoys. You could focus on the peripheral stuff as well, but the IPL at the end of the day is a sporting competition.Since we played well and won the inaugural IPL tournament, this has opened up more opportunities for us like playing in the Champions T20 League. We will, thus, be in a position to rake in more money.
What are the commercial opportunities that have opened up for you after your success?
We are scouting for strategic partnerships. There are some obvious ones like sponsorships on the shirt, etc. Then there are those that are not so obvious that will showcase the success of our franchise. We will be announcing more details later.What are the plans in the licensing and merchandising arena?
We are in discussions with different parties for tie ups. We have a very broad licensing and merchandising programme, which would cover a range of goods and services.Would it be a challenge for franchisees to get sponsors at high value because of the global economic downturn?
Even if some sectors have been affected by the downturn, other clients will come on board. When the tobacco embargo came in and Wills stopped sponsoring cricket, there were predictions of doom. However, other companies stepped in. Advertisers can’t ignore the IPL. I do not think that there is cause for any of us to panic.Why are some franchisees including Rajasthan Royals looking at raising funds by divesting stake. Isn’t this coming too soon and at a time when there is a global downturn?
There are different reasons for selling a stake. For us, the aim is to fund the development of the franchise.‘We will be diluting a small part of the equity and are looking at the private equity route. We are in the process of appointing bankers‘Are you looking at private equity investors as it is a bad time to go for an IPO?
We will be diluting a small part of the equity and are looking at the private equity route. We are in the process of appointing bankers.Up next for the Rajasthan Royals is the Champions T20 League. How do you see this developing as a property?
I think that it will be as significant for cricket as the Champions League is to soccer. In tennis you have the year-end Masters Cup where only the best of the best get to play. The Champions T20 League will occupy a similar mind space. It is being held for the first time and so there is some uncertainty among some parties; but I think it will do really well. It will be the icing on the cake when you talk about global domestic competitions.One of the things that EPL (English Premier League) clubs have done is to market themselves through foreign tours. What plans do you have in making Rajasthan Royals a major brand?
You have to remember that the EPL and its clubs are 100 years old. IPL has just finished its first year. While it is new, the IPL has aspirations to evolve into a major league in world sport like the EPL.What role will Rajasthan Royals play in helping Emerging media become a player to be reckoned with on the global stage?
I think that the success of Rajasthan Royals will provide a platform for the company to enter into other areas. However at the moment, we are going into the Champions T20 League, which will be followed by another IPL season next year.What is your strategy going to be when the trading window opens on 15 December?
We are looking at various permutations and combinations. The fact is that our team had seven nationalities. The public loved seeing Shane Warne, Sohail Tanveer and Graeme Smith on the same team. This lent freshness to the proceedings.The trading window is an innovation that fans look forward to. Who is going to be in the team? Who will not be there? Who will be traded? There will be a lot of drama around this. This is what happens in the US with college drafts for baseball and basketball. The composition of some teams in the IPL will change which will cause speculation and excitement.
What were the things discussed at the recent meeting in Bangkok to improve the IPL?
We had a conference in Bangkok to debate on the areas where we can improve upon. It was a three-day session that looked at different things – from organisation to ticketing to hospitality.Hospitality as you mentioned is an area that could be improved upon. What are Rajasthan Royals’ plans in this?
We recently launched our membership programme. We benchmarked this against other membership programmes globally. It is a five-tier programme and also includes kids. Creating a community can contribute to the financial success of the franchise as they would buy tickets, merchandise products and also attend special events. We are the first IPL franchise to launch a structured membership programme.Our membership programme could create life-long fans for the franchise. I have supported a football club in Australia since I was five years old. I am a repeat buyer of their jerseys and other club merchandise. It is about building a community and then finding ways to get them excited. Giving them special offers is one such way.
What is the impact that IPL will have on world cricket and on the business of sports marketing?
Let me take the second point first. In terms of sports marketing, it is providing a viable platform for companies to get involved with cricket. It could be through attaching themselves to the league itself or to a franchise or getting visibility on the broadcasting platform. The fact that there is also a Bollywood element to it has made the IPL an interesting marketing platform.The IPL has also brought in opportunities for service providers like ticketing companies, ad agencies and firms that specialise in hospitality.
As far as the world of cricket is concerned, the IPL has found its place. English and Sri Lankan players badly want to play in it. The IPL offers players the chance to make the most out of their short career spans. While the Future Tours Programme might make it difficult for all players to take part, the way the BCCI and other boards are dealing with the issue is good.
The IPL has also upped the ante as far as careers in sports go for Indians. Cricketers who were unheard of, can make more money here than from playing the Ranji Trophy.
As a sports marketer, do you feel that there is danger of Test cricket and ODIs getting devalued as T20 grows in importance?
This sport has had its origins in Test cricket and it would be wrong if the people in charge of the future of cricket, were not concerned about this format losing its lustre. The gatekeepers need to ensure that there is enough opportunity for the various formats to survive. The administration has to see to it that no format is overplayed or underplayed.Would the league franchise model for another sport like hockey or soccer work?
A lot of things have to be pulling together in the right direction for this to succeed – the sports administration, the broadcast platform, the corporate community and the players. -
‘Our business model in India will be driven by subscription revenues’ : Bruce Tuchman – MGM Networks executive VP
The English movie channel genre will have a new aggressive player in MGM. After making the channel available on Dish TV, the largest direct-to-home operator in India, MGM Studios has inked a five-year distribution deal with Star Den. The aim is to make the channel widely available across cable TV networks, DTH and IPTV platforms.
MGM is looking at subscription revenues and will be advertising-free – at least for the time being. The channel is priced at Rs 6 for the cable TV market and Rs 3 for DTH.
In an interview with Indiantelevision.com’s Ashwin Pinto, MGM Networks executive VP Bruce Tuchman talks about the expansion plans for the channel in India and other markets.
Excerpts:
Why did it take MGM so long to enter the Indian market?
We have participated in India before through our licensing deals with Zee and Sony. We learnt a lot from that. India is a growing market and offers huge opportunities. We decided to come with a 100 per cent ownership so that we could control our destiny.Didn’t you realise the opportunity a bit too late as channels have to now contend with carriage fees not just on cable but on DTH as well?
Some channels started operating in this market more than 10 years back. That may have been good. But it is also a great time now with digitalisation growing. India is also on a high-growth story.Why did MGM choose Star Den for distribution?
We did our first deal with Dish TV independently. That will stay as it is. But getting meaningful and broader penetration would have been a real challenge if we were to do it ourselves. We decided on Star Den as they have a strong bouquet of channels. We have good Hollywood content and have a library of 4100 films. Star Den will represent us on cable TV, DTH and IPTV platforms.Will carriage fee not hurt the business in a genre that is not growing too fast?
We do not plan to pay carriage. We have a brand and a track record that stands out. This puts us in a good position to occupy a lot of capacity without paying carriage.Would you look at presence on analogue cable and still not pay carriage?
We are looking for as much distribution as possible. The subscription base is large and it will provide an attractive revenue base. Our business model here will be driven by subscription revenues.‘Our TG would be people who are interested in Hollywood movies and who have a connection with the MGM brand. We are not a channel that showcases blockbusters‘Will MGM carry advertising?
Not for now. Globally we have advertising on some feeds. However our dominant source of revenue is subscription. Models will evolve and adapt though. We don’t know what we will do here in the future.In a genre that already has established players like HBO and Star Movies, what value does MGM bring to the table?
We are the MGM brand. We have a deep connection with the glamour and aura of Hollywood. We do things like having celebrity testimonials, going behind the scenes of films, etc.Besides, digitalisation offers room for many players. In India there are tens of millions of people who want to watch Hollywood films. In the US there are scores of film channels and not just five or six. Consumers want this kind of choice. It is key to have a brand that people stick to and trust.
Could you offer an overview of the programming strategy?
We will handpick titles from our huge library. We do a lot of stunting. We do thematic programming nights. In the evenings, we focus on genres like comedy, action. We also focus on key stars and we try to be flexible and creative with what we do.Our channel caters to people who want to expose themselves to sophisticated and eclectic film choices. We are not looking to just get attention through new releases. While there is a value to that, people often watch that film and then forget about it. Our library is classic and modern. We have films from different eras.
Will your core target audience be more elderly skewed?
Our TG would be people who are interested in Hollywood movies and who have a connection with the MGM brand that is glamorous and well known. We are not a channel that showcases blockbusters that one soon forgets about. Our aim is to show films that define an era. Films that will be shown over the coming year include Woody Allen’s classic Manhattan, Network, A Passage to India, Midnight Cowboy, The Pink Panther Strikes Again and Mystic Pizza.Does MGM acquire movies from other studios to show on the channel?
The MGM library is so large that it can be programmed forever in a manner of speaking. We are doing The Hobbit. We also have Bond films and the Pink Panther franchise. New movies are being made here. We also have the Rocky films.Would you look at a dubbed feed to expand penetration in India?
We are in English at the moment. If we expand deeply and there is consumer demand for it, I would not rule it out.What kind of marketing activities are being planned?
We have just entered into a distribution arrangement with Star Den. We have to sit down and figure out how we are to promote the channel. It could be through television, print etc. We will also do events.How has MGM gone about strengthening its worldwide TV distribution business?
We are growing well. We keep adding new countries. Three weeks back, we announced that we had a great summer across Central and Eastern Europe. Just to give you a frame of reference, in 2002 we had no branded channel presence in Europe. Now we are in over 30 European countries. In June we launched in Italy on Sky Italia.In Asia we did not have a presence five years back. Now we are in most countries in Asia. We have three channels in South Korea. We are also present in Singapore, Malaysia, Vietnam and Indonesia, among other countries. Our aim is to be as widespread as possible. We will keep an aggressive pace of development.
Outside the US, which are your key markets?
We have penetrated Western Europe nicely. Italy, Spain, Germany are key markets.In the US, MGM has tied up with Comcast for an action-oriented VoD offering. How did this deal come about?
There is big demand in the US for on demand content. Comcast is a leader in this space. It was a god idea and launched with fanfare. In Germany, the MGM channel is being distributed on the mobile. We want to get our content delivered across all forms of distribution.How has MGM stayed as an independent firm even after Sony took a 20 per cent stake in the company?
A couple of years back, people were asking whether MGM was independent. We have clarified that MGM is a vibrant and independent entity. We were also innovative in our approach. We came up with an innovative partnership with Tom Cruise. We brought him in as a partner owner of United Artists. We are co-producing The Hobbit.We are also embracing new media. We are featured on itunes. We do not just have a legacy but are also vibrant and look to the future.
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‘It is a good time to launch specialised channels as they help break through the clutter’ : Rahul Johri – Discovery India senior VP
Discovery is in restructuring mode. Earlier this year, it announced a reshuffle at the top to handle India operations. And the India office, which was reporting directly in to the Discovery headquarters at Silver Spring, Washington DC, will now come under Singapore as part of the integration strategy.
On the content front, Animal Planet introduced a Hindi feed in April to increase penetration. Discovery Travel and Living is eyeing to put its personality-driven shows at the 10 pm slot.
The company is also adding new channels like Discovery HD to grow the market in India.
Indiantelevision.com’s Ashwin Pinto caught up with Discovery India senior VP, GM Rahul Johri to find out more about the company’s aggressive plans in India.
Excerpts:
What is the main reason behind the restructuring that took place in Discovery recently?
Discovery went into local markets in Europe a few years back, and this yielded very good results. Applying the same model, the Asia Pacific region has been broken up into six – the Saarc countries which include India, China, Japan, North Asia, Australia/New Zealand and South East Asia (Thailand, Malaysia, Indonesia, Singapore).In India, people have moved up a level. I have management responsibility for India while Rajiv Bakshi looks after marketing. Then there is a regional managing director who sits in Singapore.
We now work and coordinate with Singapore. The response time is much quicker.
Earlier when we reported to Washington, the time zones were different. Also, what is a priority for us may not be as important for them. Now operations are easier in terms of taking decisions and getting clearances.
How does the new operational structure help Discovery India?
Discovery Asia has a strong infrastructure. This will now be more accessible to us. We can approach opportunities on an Asia wide basis as opposed to simply focussing on one country. For instance if a local production is being done out of India or Singapore, it can then be expanded to include other Asian countries. Solutions can be provided to enable this. On the client side also, we can provide solutions more easily so that they get visibility across the region and not just in one country.What are the key focus areas for India?
Collaborating with the other regions in Asia to drive growth will be important. Sharing of content and resources will be key. We will also strengthen the branding of our channels by making the content more definitive. We will keep refreshing content across all the channels so that audiences get what they want to watch.Are you looking at growth through launch of more channels?
Yes! As the Indian television market matures, it is a good time for specialised channels to launch as they help break through the clutter.We have 14 channels and we will bring what we feel will click the best. Discovery HD is definitely a channel we are keen on bringing to India. Discovery Science is another channel that we feel would work well here. Of course, it is also important for cable to go digital. Otherwise getting carried gets difficult.
Discovery has launched Planet Green, a new channel for environment, in the US. Do Are there plans to launch in India?
The channel has just launched in the US. A band of the channel will launch in Southeast Asia. We will see how viewers respond to it. We will test the programming in India and then decide on whether or not to launch the channel here.‘Starting Hindi feed worked for our two channels as there is a lot of commentary. This won’t work in Discovery Travel and Living‘In terms of revenue, how important is India within Asia?
India is one of the top markets along with Japan, Australia and New Zealand. Subscription plays a key role everywhere. In India there has been strong growth in ad sales.How is Animal Planet faring after going Hindi?
The most important thing was the Hindi feed being introduced in April. Now we are able to compete better with National Geographic. Going Hindi was, thus, a progressive step. We play to the core strength of the channel which is focussing on the animal kingdom. We also have hosted shows.Will you be doing a Hindi feed for Discovery Travel and Living?
No! It worked for our other two channels as there is a lot of commentary. In Discovery Travel and Living, though, it will not be natural to see, for instance, two Chinese people speaking in Hindi.How has Discovery Travel and Living evolved as a brand since launching four years back?
DTL is perceived as being a distinctive lifestyle channel for upmarket viewers. People are now familiar with our anchors like Nigella Lawson. They also identify with individual shows like our biker content. We keep refreshing our programming. We bring new shows regularly.What have been the programming highlights for the channel this year?
We did a show with Manish Arora. We are doing two more India productions which will premiere later this year. Our big show now is Cheese Slices. Food is a popular genre for us. So we will kick off a show, Indian Food Made Easy, which will be hosted by Anjum Anand.We will be launching a multimedia campaign to push our 10 pm slot. This is because our viewers tune in a little later. Personality-based shows will air at this time, seven days a week. The message of the campaign is that at this time you will see hosts like Nigella Lawson, Ian Wright and Anthony Bourdain; the campaign theme will focus on the most recognisable faces on the channel. This will be the largest campaign ever done for the channel.
Is the aim to bring in appointment viewing?
This is one of the goals. The campaign will showcase our biggest properties. We are hoping that it will help expand the reach of the channel and drive in new viewership. It is important that our campaign not focus on just one show. By pushing a band, the recall will be high among viewers.In what way is the programming strategy being fine tuned for local audiences?
When we started, we had very little India content. We now produce shows from India. Every global show that is being produced, has a segment on India. So if Anthony Bourdain does a new season, he will visit India as well. This is how the relevance of India is growing. Ian Wright used to just host Globetrekker which is about backpack travel. Most of our viewers do not do that. So we tweaked it and now Wright does VIP Weekends. He visits the best hotels globally.Has the thematic weekend concept worked?
It has done well and the thematic weekends are continuing. But over time our aim is to build a theme across a day – rather than having one theme continuing everyday. Our aim is to strengthen the genres. For instance if you take shows like Anthony Bourdain and Cheese Slices, it is not just about food. It is also about travel, visiting new places. Different genres get intertwined.What do you look for in a local show?
We always look out for good local concepts. Our aim is to have a definitive show in a certain genre. Once we have decided on this, then we go with the best talent. So we roped in Manish Arora to do a fashion show. He is suited for television as he is so colourful.Our shows have to have an individual and distinctive personality. They need to be of the same class and quality as the other shows that we air. There can’t be any compromise as the same shows travel abroad and showcase India to the world.
What are the other time bands that DTL is developing outside the 10 pm slot?
We are also looking at the midnight to 1 am time slot. People watch us at that hour. I think that some channels are missing out on viewership by not concentrating on this audience. They simply run repeats at this hour. Many people work till late and then watch television.Is it difficult to get clients to commit serious monies for Discovery Travel and Living with the economy in a downturn?
Our market is on an upswing. Our TG has not been impacted by the downturn. We have over 600 brands with us including L’Oreal and the car companies. Volkswagen is starting a marketing campaign and they are using our channel as a vehicle. Packaged good companies also advertise with us. Companies that want to target the premium audience cut out wastage completely when they come to us.What are the tentpole properties coming up for Discovery?
Ultimate Olympics is a show that we will air. It looks at the work that has gone behind putting the Olympic Games together. The show gets over a day before the Games start. Another show that will air is Download. This focusses on stories from the internet like the competition between EBay and Amazon.We will also celebrate Nasa’s 50th anniversary with a show When We Left Earth. Nasa has given us footage of the Apollo Missions. This is the first time that Nasa has done this.
What is Discovery’s new media strategy?
We already have our website. For the mobile, 3G has to happen; the phones have to support rich media content. Right now one is still with ring tones and music tones. -
‘2008 has been HBO’s best year in terms of quality and quantity of programming’ : Shruti Bajpai – HBO South Asia Country Manager
As the television landscape gets more crowded with new entrants, the challenge for existing players is to keep innovating. HBO, which has bought out the stakes of its partners in the Asia venture except Paramount, still has exclusive licensing arrangements with Sony, Universal, Warner Bros and Paramount/DreamWorks.
Late last year, the English movie channel launched an anchor slot HBO Wicked Hour. The focus in this slot is on action, thrillers, suspense, sci-Fi and critically acclaimed movies for the late night male viewers. This is part of the channel’s strategy to create new programming blocks to cater to specific TGs.
In an interview with Indiantelevision.com’s Ashwin Pinto, HBO South Asia country manager Shruti Bajpai talks about the challenges that confront English movie channels and the pressure to focus on content and branding.
Excerpts:
Why did HBO buy out its partners in the Asia venture except for Paramount?
This was a management decision in keeping with HBO’s expansion plans across the world. HBO wanted to further build on its strong position in the US. The majority equity stake in HBO Asia is a further testament to this expansion.Does the channel now have to bid for new titles coming from its former partners?
We have exclusive licensing arrangements with Sony, Universal, Warner Bros and Paramount/ DreamWorks. This arrangement continues uninterrupted. This is the reason why we have such a strong inventory.What are the challenges that are going to confront the English movie genre over the next few years?
The last few months have seen a spate of launches in the Hollywood/International cinema and there are some more expected this year. There is an intense amount of clutter in the overall TV channel space and the viewer is spoilt for choice.I am of the firm opinion that channels with compelling and consistently ‘winning’ content will continue to flourish while the others will just about manage to survive at the periphery. Hollywood movies are beginning to grab a bigger chunk of India’s huge movie market, traditionally dominated by Bollywood.
A larger Indian audience than ever before is viewing the Hollywood movies and the appetite for such content seems to be increasing. Breaking through the clutter and being able to hold on to the attention of the audience, which is usually short due to the ample choices available, will be a rising phenomena in this category.
How has HBO fine tuned its programming strategy?
HBO has been following the mantra of ‘Big, New, Most’ for Indian viewers. We have always devised innovative and topical themes around our movies, instead of fitting it in a “genre for each day” bracket. We do not believe in doing automatic repeats the morning after, like other channels.Has HBO spruced up the content this year because of new competition?
It will not be wrong for me to state that 2008 has been HBO’s best year in terms of the quality and quantity of programming. We have a supply of blockbuster hits that take center stage every month like Superman Returns, Ghost Rider, Happy Feet and Mr. Bean’s Holiday.In addition, we also air critically acclaimed movies and blockbusters that anchor the Saturday primetime slot at 9 pm. These have included Munich, World Trade Centre, Memoirs Of a Geisha, Blood Diamond. Upcoming titles include Spiderman 3, Surf’s Up and The Pursuit Of Happyness.
What is also important is our focus on entertaining themes. These are conceptualised for the channel every month. They target different TGs and advertisers. Some examples of these are HBO Animation Fest, Mad About Diamonds, Fast Cars and Gorgeous Babes, HBO Earth Day.
Also playing a role are tentpole events. We did a Hollywood’s Best initiative which featured Oscar nominated/winning movies, HBO is Summer during May and June, which featured Summer of 60 Nights. Here, a blockbuster movie was shown every night. Moreover there were also mini-stunts under the HBO is summer umbrella like Entrapment, Martial Arts Specialists ‘Codename: SuperKids etc. All these have resounded with our target audience.
To add to this, we have looked to raise the bar when it comes to quality programming with original series like Entourage, the third season of which has just begun on the channel and themes like HBO- Movies with a difference that showcases movies that make us sit and think.
Have new programming blocks been created to cater to different TGs?
Our most current anchor slot HBO Wicked Hour was launched late last year. It focuses on action, thrillers, suspense, sci-Fi and critically acclaimed movies for our late night male viewers.Right now, we are focussed on building this slot and also other key slots like It’s a Guy Thing, Midday Matinee, Family Sunday etc. We are always on the lookout for creating new programming blocks to cater to specific TGs.
As the audience gets more fragmented in the metros, the challenge for English movie channels is to reach out to the smaller cities as well. How is HBO targeting these viewers who are aspirational?
Television is one of the biggest sources of entertainment for people across categories in India. Where the audiences have evolved, programming has also seen a huge turn around on the small screen. With the choice and variety on offer for the Indian audiences, the television industry today is booming. It is not only in the metros but also the smaller towns where there are potential viewers. What matters ultimately is the content that is shown – if the content is different and unique, it is well appreciated by the viewers.The increase in multiplexes in smaller towns and the increase in global travel by Indians from all across the country have added to the familiarity with Hollywood movies and shows. HBO is a global brand and this helps in the affinity towards the channel.
How has the channel fared on the ad sales front?
The ad revenues are growing year-on-year. Turner, our ad sales partner, has done an excellent job to maximise revenues and also retain a number of advertisers exclusively on HBO.
‘DTH is growing, but the format is still the classic ‘one price for all channels’ rather than specialised packages. This is expected to change as the market matures‘Has perception among clients about this genre improved?
HBO is perhaps one of the few channels that is more than just a channel; the brand gives a big boost to the channel’s perception.Also, English movies is a genre that our ad clients consume on a regular basis.
What are the kind of packages you offer clients that go beyond the 30-second spot?
We have different packages that are tailor made for different clients. One of our packages is the brand integration package where we seamlessly integrate the positioning of the brand that is being advertised into the theme for the month. We also have a lot of contests that we do for the advertisers that go beyond the 30-second spot.Channels have started advertising on rival bouquets. Does HBO accept ads from other channels that are not part of Zee Turner or is there a conflict of interest?
We do accept advertising from other channels, but are careful in picking those that have the right fit. Some of the channels that have recently advertised on HBO are BBC Entertainment and English business channel UTVi.Is HBO looking to boost its content around news shows to add variety to filmed content?
HBO has always believed in giving its Indian audiences the best of international programming and content across genres. We already have a diverse mix of blockbusters, all time favourites and original productions. In fact HBO is the only channel to have both the raters and the differentiators.The third season of the show Entourage just premiered in late June and we have Big Love coming soon. Also, the recently-aired two part mini-series in the US, The Andromeda Strain, which is based on the best-selling novel by Michael Crichton, is going to be on our channel soon.
Does HBO do a lot of marketing and promotional activities to create awareness?
HBO’s marketing and promotional activities have always looked to be innovative and clutter breaking. This year we have had many multimedia campaigns to announce our Summer line-up, our mega blockbusters and our shows.We have a well planned strategy for the rest of the year, especially during the festive season of October-December. As we speak, we are running a multimedia campaign that includes a contest, to promote Spiderman 3.
The hope is that addressability will get a push this year with DTH (direct-tohome) seeing new launches this year. How do you see the distribution scenario evolving?
As new launches increase, distribution becomes critical. We are also hoping that addressability gets implemented in the right manner.DTH is also growing, but the format is still the classic ‘one price for all channels’ rather than specialised packages and introduction of new tiers. This is expected to change as the market matures.