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Tag: DVD

  • UK video rental market plunges

    UK video rental market plunges

    MUMBAI: The market for Blu-ray (BD) and DVD rental in the UK is expected to plunge by 22 per cent this year, as half the country‘s Blockbuster video stores shut down in a restructuring initiated by the company‘s new management.

    The UK market for physical-video rental will drop to GBP 202 million in 2013, down GBP 57 million, or 22 per cent from GBP 259 million in 2012, according to a newly updated forecast from IHS. While the market is generally on the decline, 2013 will bring the sharpest predicted annual decrease for the 11-year period from 2007 through 2017.

    By the end of 2013, only 264 Blockbuster stores will be open in the country, down 50 per cent from 530 in 2012. Blockbuster is the largest video rental chain in the country.

    IHS senior video analyst Tony Gunnarsson said, “The year 2013 is set to become a watershed for the UK video rental market as a result of the wholesale closure of Blockbuster UK stores. The massive downturn in the store-based video rental market represents a significant loss to the video market and will result in a major decline and radical transformation of the UK video market overall. From 2013 on, the UK physical-video rental business increasingly will be dominated by online rent-by-mail subscription services.”

    Both DVD and BD transactions are due to decrease across the store-based sector this year. DVD rentals will fall by a steep 53.2 per cent to 15.4 million. BD is set to drop by an even larger 61.3 per cent to 2.8 million respectively.

    Blockbuster gets busted up: After filing for administration in January 2013, Blockbuster‘s administrators Deloitte announced two separate rounds of store closures, including some 224 sites. In February 2013, supermarket chain Morrisons purchased 49 of these former Blockbuster stores in its drive to increase its store presence in southeast England.

    Out of the remaining Blockbuster stores, Gordon Brothers acquired a total of 264 locations, including a number of Blockbuster outlets earmarked for closure that will now remain open.

    Pay-TV killed the video store: In 2012, rental stores were responsible for 41.3 per cent of the video rental market based on consumer spending. In the latest forecast for 2013, however, the store-based sector is now projected to generate just 24.7 per cent of the overall market. This tilts the market toward the online sector, which will see its share of market increase massively from 58.7 per cent in 2012 to 75.3 per cent this year.

    At the same time, the lost rental business won‘t result in customers that used to rent at Blockbusters automatically signing up to become rent-by-mail customers with online providers, IHS believes. Rather, those customers are more likely to turn to a host of other video platforms, primarily pay-TV services.

    Video Rental Market Winds Down: In the longer view, the U.K. rental market will return to a normal trend of decline after 2013, with spending on renting physical video shrinking at an annual rate of under 5 per cent until 2017. By then, the retreat in spending is expected to be slightly more negative at seven per cent.

  • US audiences to pay for more online movies in 2012 than for physical videos

    US audiences to pay for more online movies in 2012 than for physical videos

    MUMBAI: Americans will pay to consume more movies online this year than they will on physical video formats, marking the first year that legal, Internet-delivered movies will outstrip those of DVDs and Blu-ray discs combined.

    The legal, paid consumption of movies online in the United States will reach 3.4 billion views or transactions in 2012, approximately 1.0 billion units higher than the 2.4 billion for physical video for this year, according to the IHS Screen Digest Broadband Media Market Insight report from information and analytics provider IHS. As recently as last year, physical video had claimed a commanding share of the market with 2.6 billion views or transactions, compared to 1.4 billion for online.

    This year’s online video consumption via the open Internet represents annual growth of 135 per cent from 2011. Online video transactions and videos are also set to continue increasing in the years to come, while physical video sales are expected to decline or stagnate in comparison.

    IHS senior principal analyst, broadband, digital media Dan Cryan said, “The year 2012 will be the final nail to the coffin on the old idea that consumers won’t accept premium content distribution over the Internet. In fact, the growth in online consumption is part of a broader trend that has seen the total number of movies consumed from services that are traditionally considered ‘home entertainment’ grow by 40 percent between 2007 and 2011, even as the number of movies viewed on physical formats has declined.”

    The physical segment consists of retail sales and rentals of VHS, DVD and Blu-ray discs (BD). The online portion is consists of electronic sell-through (EST), Internet video on demand (iVOD) and subscription video on demand (SVOD).

    Key to the surge in consumption of online video has been the rise of all-you-can-eat subscription services such as Netflix and Amazon Prime, which offer customers unlimited on-demand movies for a flat monthly or annual fee. The result is that subscriptions in 2011 accounted for 94 per cent of all paid online movie consumption in the United States, compared to just 1.3 per cent of units consumed that were bought on an ownership basis via electronic sell-through.

    Although it is declining, physical video this year will still command more viewing time from Americans, who will spend an estimated 4.3 billion hours on DVDs and Blu-ray discs, compared to 3.2 billion hours for movies online.

    And although online will account for the majority of transactions this year, it is set to attract a far lower share of revenue in 2012, at $1.7 billion, measured against $11.1 billion derived from physical formats. This is because consumers will pay an average of 51 cents for every movie consumed online, compared to $4.72 for physical video. The pattern will likely remain unchanged even by 2016, with online accounting for 17 percent of revenue, compared to 75 percent for physical video, and pay-TV video on demand taking the remaining 8 percent.

    Netflix, while unquestionably the market leader, is not the only online SVOD game in town. Last year saw both Amazon and Hulu develop online streaming businesses at levels unheard of just a couple of years ago. For Amazon in particular, 2011 marked the transformation of Amazon Prime from a discounted shipping offer into a diverse entertainment proposition in its own right, allowing subscribers who paid the $79 per-year service access to a range of movies and TV shows.

    The phenomenal growth of subscription movie consumption raises the prospect that as SVOD services become more widely adopted, they become an appreciable drain on the time that consumers would have used to watch movies in more lucrative ways, IHS believes. When this is combined with the possibility that consumers will always find something to watch, the still-nascent EST business could have its wings clipped before it can really take flight, even as consumption reaches previously unattainable highs.

    “After more than 30 years of buying and renting movies on tapes and discs, this year marks the tipping point as U.S. consumers now are making a historic switch to Internet-based consumption, setting the stage for a worldwide migration of consumption from physical to online. We are looking at the beginning of the end of the age of movies on physical media like DVD and Blu-ray. But the transition is
    likely to take time: almost nine years after the launch of the iTunes Store, CDs are still a vital part of the music business,” Cryan said.

  • ‘Working on an umbrella brand strategy is a good way to build a presence in the entertainment space’ : Rajesh Sawhney – Reliance Entertainment President

    ‘Working on an umbrella brand strategy is a good way to build a presence in the entertainment space’ : Rajesh Sawhney – Reliance Entertainment President

    As 2007 comes to a close, Reliance Entertainment president Rajesh Sawhney is an apt choice for our year-ending interview, not necessarily in the context of what Anil Ambani’s company has done in the broadcast space this year, but because of the expectations from industry, going forward.

     

    On the television front, the journey of being a broadcaster starts next year with the launch of two movie channels (first Hindi and later English), a logical extension from Reliance ADAG’s existing film production and distribution business. The broadcast piece will add to a list that ranges from multiplexes to movies, home video, FM radio, direct-to-home (DTH) and IPTV.

     

    On radio, the aim is to consolidate its position. It will also be active in distribution with its DTH platform coming up. Thomas Abraham and Ashwin Pinto caught up with Sawhney to find out about the plans and the kind of impact that Reliance is looking to have on the entertainment space.

     

    Excerpts:

    Firstly, 2007 was the year when Reliance Entertainment sowed the seeds for what is to come. What were the landmarks for this year?
    We are a young player only two years old. Our journey into entertainment kicked off with the Adlabs acquisition. Then we moved into radio in 2006. We started rolling it out by the end of last year. Then we moved into other ventures like Zapak, our gaming portal. From my perspective, we are still in the incubation phase and the larger consideration is that the entertainment and media industry is where telecom was five years back. The media industry will be worth $25 billion in five years time. A lot of value creation will happen in the coming five years similar to what was seen in telecom.

     

    The second big thing will be the emergence of digital entertainment. Platforms are now set. This will be a large driver.

     

    The third thing is that with the economy growing at 10 per cent, the Indian consumer is spending more and more on entertainment. The first indication of this is the multiplex boom. Now even monies spent on entertainment at home like DVD rentals, pay per view are growing.

     

    The entertainment industry is worth $ 11-12 billion out of a trillion dollar economy, which means 1 per cent of the economy. Globally it is 3 per cent. In the US, it is 5 per cent. If we take the telecom parallel, revenue is 3-4 per cent. In India it is 2.5 per cent. India has a convergence deficit in this sense. This is where the real opportunity is going forward.

     

    I see Indian players having strengths in certain verticals. Some are strong in print, others in movies while others focus on radio. Nobody is building a comprehensive brand presence across media. This strategy would allow you to capture the three per cent deficit. This is what we are chasing.

    What is the kind of impact that Reliance is hoping to have on the entertainment space across the different verticals?
    Let us take the movie industry. It is on a huge cusp of change. If you go back 10 years there were no multiplexes, no DVD formats. Home entertainment will be the next value driver for the movie industry in the coming decade. DVD and home entertainment revenues are the biggest source of revenue for Hollywood. Here it is less than 10 per cent. We are going through the first phase which is theatrical revenues. Home entertainment will be the next phase.

     

    For this you need concepts like Big Flicks which will make organised retailing possible. It will make home entertainment delivery through broadband, DTH, IPTV possible. Pay per view revenues will be created for the Indian movie industry. Content in the long tail form across different platforms will offer more choice. The companies who are preparing for this will gain big time as far as the movie industry is concerned.

     

    The second revolution happening in the Indian movie industry is on the content side. So production values have risen. Talent is getting a huge amount of value which is getting aligned to global values. Content will get value from overseas markets, home entertainment, satellite markets. A $10 million movie has become the norm. I can see a situation where $100 million movie is viable but this will take time to happen. You will see Hollywood and Bollywood collaborating more.

    How will Reliance benefit from the synergy between Reliance Communication and Reliance Entertainment?
    Reliance Communication is building distribution capabilities on mobile, DTH, IPTV and broadband platform. Reliance Entertainment is building a presence and capabilities on the content side across different verticals – content, broadcasting, themed entertainment and new media.

    A large part of your plan involves targeting the youth across different verticals. How are you going about this?
    We are a youth focussed company. This has a commercial reason. We believe that youth drives entertainment. Youth is driving the movie consumption business. India has the best youth demographic platform in the world. We are the youngest country in the world. We keep youth in mind in whatever we do whether it is radio with Big FM or making movies or Zapak.
    ‘The government should allow news and current affairs. This is why you do not have talk radio‘

    You have taken the brand name Big for your businesses like Big FM, Big Flicks. Is the aim here to convey to the consumer an idea about the size and scale of the brand?
    Unlike many companies that work with a house of brands strategy we believe that working on an umbrella brand strategy is a good way to build a presence in the entertainment space. The choice of the name is predicated on three reasons. Firstly it is simple to understand. Everyone, regardless of language, understands Big. The second reason is it is simple to communicate. A mass brand needs to be understood by everyone. And third, the brand name must give people an understanding of the scale at which we want to bring entertainment to consumers.

    How important is the broadcasting space for Reliance?
    It is very important for us. Our first investment has been in radio with Big FM. We won 145 licenses in 2006. We will take part in the next round of bidding when the government goes ahead. We are the largest radio station in the country with 40 stations. With the execution of radio we have shown a clear commitment by executing the fastest. In Delhi, Bangalore and Mumbai we have emerged as a top player. We have created a leadership position not just by the number of stations but also in the markets where they operate, including those that are entrenched. We want to consolidate our position next year.

    Radio needs to differentiate itself instead of just going after the widest lane with popular Hindi songs. Why isn’t this happening?
    I do not blame the private players for this. I blame government policy. The government should allow news and current affairs. This is why you do not have talk radio. Multiple stations should be allowed. At the moment only five to six stations are available in the Metros. The government should ensure that 30-40 stations are available. One company can run five channels in a state. The government should introduce policies to facilitate the next growth phase. Niche formats become viable if frequencies are made available at lower rates. Running a Gujarati channel at a license fee of Rs 30 crores (Rs 300 million) does not make sense in Mumbai.

    Are you also looking at online radio?
    Yes! In the West, radio is a mature industry. Online is a growth industry there. In India FM and online are coming at the same time. The biggest opportunity is in FM. It is hugely underserved India should have 10,000 FM stations. Now there are less than 300 stations. I can run stations in different languages in Mumbai with viability as long as I am allowed to do so. There is also an opportunity to serve the non resident markets.

  • DVD market on the cusp of change

    The DVD market in India is witnessing major change. The prices of both hardware and software has become highly competitive and a host of online rental players have emerged. But what impact will low prices have on the rental business and what pricing strategies are home video firms employing? This story offers a look at the current situation of the home video market in the country.

     

    First off, there is no denying that the DVD revolution is possibly the biggest thing that could have ever happened to movie buffs.

    Today, six cities including Bangalore, Delhi, Mumbai, Chennai, Hyderabad, Kolkata account for 70 per cent of the DVD player penetration in the market.

    According to Federation of Indian Chambers of Commerce and Industry (Ficci ), a PWC report states that there is a huge upspring in plasma TVs and home theatre surround sound systems, which has boosted the demand for home video products like DVDs and VCDs.

    The home video market in India – largely the rental market – was estimated to be about Rs 4 billion in 2005. Over the past two years, it has grown by about 15-18 per cent per year. The share of the home video market is estimated to be six per cent of the total film-based entertainment business. This is expected to grow to about 14 per cent by 2010, driven by the shorter-release windows in the theatrical business.

    India has approximately 15 million DVD players and this figure is expected to touch 70 million by 2010, which translates into a vastly untapped video rental market.

     

    The present market scenario

    The global broadcast technology market is worth $11 billion and is set to grow at 11 per cent with the pace being set in Europe, Middle East and Africa. This fact was highlighted at Broadcast Asia 2007, which is Asia’s biggest industry event held in Singapore from 19 -22 June 2007.

    The country has over five million home video and DVD subscribers and current penetration levels are expected to grow 31 per cent, according to the PWC report.

    The home video market is going to almost double from Rs 830 crore in 2007 to Rs 1,700 crore in 2010. The drastic cut in the price of DVDs has allowed DVDs to be sold through supermarkets as well. In the international scene, the total market has grown to an estimated 8.8 million subscribers at the end of 2006, with total estimated rental revenue of over $1.2 billion.

     

    Adams Media Research and Netflix internal estimates project that the total market will have more than 20 million online subscribers in the next four to six years. The DVD rental business is in the season of mergers, the latest to happen is the biggest fund raiser in the rental space Seventymm has acquired 100 per cent equity of the oldest rental service agency Madhouse.

     

    Moser Baer in the entertainment basket

    One player that is looking to change the dynamics of the home video market is Moser Baer. Its entry into the home entertainment market was marked by its move to slash the prices of DVDs and offer regional titles. This positioned the company among the top contenders and the biggest guns of retailers entering this market.

    Its set to change all the dynamics of the entertainment market and the problems conflicting the industry like high prices of DVDs which had given the rise of steadily flowing of piracy and high fragmentation in this business.

    Companies are releasing video content in DVD and VCD formats to ensure the highest quality standards, but also to significantly reduce costs. Moser Baer‘s fully licensed titles will be available at Rs 28 for an Indian film VCD and Rs 34 for an Indian film DVD – price points that we said before, will not just redefine the Rs 650 crore ($150 million) home entertainment business in the country, but also put it on the path to a four- to five-fold growth in the next three years. Of this, Moser Baer aims to have at least 50 per cent market share.

     

    One of Moser Baer‘s recent releases

    Pricing strategies: Moser Baer will also be releasing non-film titles in the following areas at different price points, including VCDs at Rs 49 and DVDs at Rs 69. Two VCDs will be priced at Rs 89. All English movie titles will be marketed (VCDs at market price of 49 and DVD of Rs 69). The company is also planning to launch single VCDs of songs in the range of prices starting from Rs 20 in all key languages.

     

    Distribution: Moser Baer is also setting up exclusive branded outlets (owned or through franchise) at about 300 locations, in addition to alliances with large format stores established by various retail ventures in the country. They have established a network of carrying and forwarding agents in all the states of India.

    Other players slashing prices: Shemaroo & Eros

     

    Other players in the market include the veteran Shemaroo. The firm recently introduced three new pricing categories for some products starting at Rs 66. Shemaroo VP Hiren Gada says that the last time DVD prices were reviewed was in 2004. He adds that the firm anticipated the competition in terms of prices and more players a few years back which is why it has sought to diversify itself.

    More price cutting has come from Eros International which has slashed its entry price on DVDs, cutting it down from around Rs 150 to Rs 99 to keep in tune with the dynamics of the market.

    One of the films in Shemaroo‘s low price catalogue

    Eyeing the potential of this sector, Reliance Entertainment, Nimbus and Percept are among the other players looking to enter the home video space with competitively priced products. Reliance is investing $ 100 million in its home video division Bigflicks. This has both an online and an offline component.

    The online component will mainly target NRIs. The offline component will consist of retail stores across the country. By the end of this financial year there will be 100 stores in 10 cities. In three years there will be around 500 stores in 50 cities. They will function as neighbourhood stores. They will offer DVDs for rental and sale. While the pricing strategy has not been decided upon Bigflicks COO Kamal Gianchandani says that it will be competitive.

     

    No drastic price reduction: Excel Home Video

    This animation film has done well for Excel

    For some of the other existing firms it is still a ‘wait and watch‘ strategy on the pricing front. Excel Home Video which focusses on Hollywood is not going in for huge price reduction anytime soon. Excel Home Video MD M N Kapasi says that it is not a question of high price or low prices.

    “So far the introduction of low price discs has not affected our business. We will reduce the price of our products marginally to push up volumes but it will not be a drastic reduction.

    “Demand is a function of content. You can have cheap hardware but if the software is not there a firm will not find takers. At the current price level of our DVDs and VCDs we are satisfied with the volume of business. We will be doing a study now to find out what the consumer expects. Is it a low price or is it quality they seek? Depending on that we will take a decision on how we go ahead.”

    No need to plunge prices: Sony Pictures

     

    Sony Pictures which has a home video unit is also adopting a wait and watch strategy. The firm feels that its price points are reasonable and with that price point it claims to compete successfully and at the same time make profits.

    A spokesperson says that there is no sudden need to plunge the prices when consumers are willing to make a price value comparison on a particular film. At a super low price one will bleed. It is worth noting that Moser Baer has an advantage. Since it is a disc manufacturer it can bring prices down more effectively than the competition.

     

    The webslinger has proven to be a winner for Sony Pictures on the home video front as well

    It is expected by the industry that the advent of low priced DVD players and some software at a reasonable price will help convert VCD buyers to DVD buyers thus helping to educate the consumer about the better quality and features of DVDs over VCDs. VCDs are still likely to sell in large volumes for some time though, as DVD hardware penetration in rural India is still not very high.

     

    Moreover, with the advent of lower cost DVDs, new distribution channels are likely to open up, thereby expanding the availability of DVDs more than they currently are. Several players are betting on home videos becoming a FMCG product being sold through multiple retail points like super markets and departmental stores apart from traditional music and video stores. Also, with the expansion of organised retailing in India, over the next few years, home videos are likely to get wider distribution reach.

    However, the key issue is what impact will low pricing of DVDs have on the rental business?

    As of now the rental business whether online or offline is yet to see the full impact of the low cost DVDs. It might not get affected in the short term as most of the renting happens for new Hindi and international releases mostly priced between Rs 299 – Rs 599 for DVD and Rs 149 – Rs 299 for VCD. The price reductions are usually introduced for older movies, classic titles. However, if prices for international and newer Hindi products also fall drastically in the next three years, as has been predicted by Moser Baer, then the rental business will certainly get affected.

     

    Industry players however don’t feel that low cost DVDs will have a major impact on cinema revenues. That is because theatre viewing is a different experience with the family as an outing. Video cannot replace that experience. Further, several films have a great impact on the big screen, compared to the small screen.

     

    Theatrical business will generally not be hit as there is a hold back period of 2-10 weeks before the original home video can be launched legally by the home video rights owner. Normally, the film completes its theatrical run by then.

     

    The Online DVD rental markets

     

    Coming to the fast expanding online DVD rental business that poses competition to the DVD market, include players such as Madhouse, Seventymm and Clixflix among others.

    Reasons for splurge in the Online DVD market

     

    • Internet penetration in India is growing not only in the urban areas but also in B and C class cities which has made possible the entry of this market in rural and small areas. The number of individuals who accessed the internet has increased marginally from 10.8 million to 13.0 million in 2006.

    • Local rental stores provided the customers with only limited editions of popular bollywood flicks, nothing besides that.

    • Cheap content and poor quality makes it hard for the consumer to get good quality DVDs at rental stores.

    • The organised movie rental business has checked the rampant problems of pirated versions.

    The leading players include:

     

    Madhouse (www.madhouse.in)

    Madhouse, which rents out original and legal disks, is among the earliest players in the sector. It claims to be the first rental service Indian company to offer movie rental services accessible via a multi-channel model. This includes customer interactions through the web, SMS, phone and kiosks. Founded in December 2004, Madhouse is headquartered in Delhi. The rental service was launched in the tri-city region of Chandigarh, Panchkula and Mohali in May 2005.

    Madhouse was acquired by Seventymm this year.

    Seventymm (www.seventymm.com)

    With a funding of Rs 100 million from US based Draper Fisher Jurveston and 32 crore funding from Matrix Partners Seventymm is currently based in Bangalore, Delhi-NCR, Hyderabad and Mumbai. It was launched in 2005.

     

    Cinesprite (www.cinesprite.com)

    Cinesprite.com, which was launched in 2006 with nearly 10,000 titles, is a DVD rental site that offers subscription plans ranging from one to 12 months with an activation fee of Rs 150 and Rs 250 depending upon the package the viewer chooses.

     

    Moviemart (www.moviemart.in)

    Movie Mart, a new comer in this space was launched this year. The website is also a subscription based DVD movie rental service providing its members access to a library of motion picture, television and other film entertainment. The member can choose from their subscription packages and also offers unlimited validity period for four DVDs at a time at a price of Rs 999. These prices are key in combating the falling prices of software.

     

     

    Catchflix (www.catchflix.com)

    Catchflix online rental service was launched in may 2006. It covers Bangalore, Mumbai, Delhi- NCR, Bhubaneswar, Hyderabad. It offers a 50 DVD package at a cost of Rs 2899.

     

    Clixflix (www.clixflix.com)

    Launched in October 2004, Clixflix plans to expand nationally. It offers a package of six DVDs a month at Rs 399 and unlimited DVDs at Rs 799. This is a Mumbai based rental agency.

    Bigflicks (www.bigflicks.com)
    This is Reliance‘s online video service and will mainly target the NRI market. It has launched its on-demand movie download service. It offers films in Hindi, Marathi, Tamil, Telugu, Punjabi and Kannada that will be available for either download to own at a fee or for free streaming. The firm says that its USP is that it is the first and only online movie library with the largest regional content. The download price ranges from $2 – $15.

    BigFlicks.com will offer 2000 titles in the first year and there will be revenue sharing arrangements with the content owners. The site is also looking at acquiring Indian television content apart from looking to connect with subscribers in America, UK, Canada, Middle East, Australia and South East Asia. The site aims to have an easy interface and navigability. It offers downloading speed with bit rates of 1500 kbps.

     

    Conclusion

    Thus, it is not surprising to see why online DVD rental chains and retail majors have forayed into sales and distribution tie-ups apart from acquiring copyrights from content DVD manufacturers. The market is booming and online DVD rental companies are looking to expand through tie-ups with retail chains.

    The Indian entertainment industry is worth about $5.2 billion out of which the film industry alone is worth about $1.5 billion. Even though the online DVD rental players have a tiny market share presently, they are planning to grow rapidly and expect to reach $100 million within the next five years. DVD content owners are experimenting more with packaging to make the product more attractive as well as providing added value features.

  • Moser Baer entertainment business CEO Harish Dayani : Harish Dayani- Moser Baer entertainment business CEO

    Moser Baer entertainment business CEO Harish Dayani : Harish Dayani- Moser Baer entertainment business CEO

    Moser Baer is shaking up the home video market with its low pricing. While VCDs are available at Rs 28, DVDs are priced at Rs 34.

     

    Will the market dynamics change as new players like Adlabs hatch plans to enter the business?

     

    In an interview with Indiantelevision.com’s Sibabrata Das and Ashwin Pinto, Moser Baer entertainment business CEO Harish Dayani elaborates on how the home video market will never be the same.

     

    Excerpts:

    Why did Moser Baer decide to get into the entertainment and home video market?
    Moser Baer is the world’s second largest optical storage manufacturer. As we make 10 million discs a day, we have economies of scale. We can manufacture a disc at a price that not too many people in the world can match. Having such a strong backend in this form of business, we were somewhere in the commodity space. The obvious forward integration for us was to add content. In India, there is nothing like entertainment as far as replication on a product like a disc is concerned. This is where the whole thing started around a year ago – and we had the money to do it.

    When several home video players like Time have folded up, what made you think that Moser Baer could fix it right?
    We felt there were gaps in the industry which we could fill. The home video market is fragmented and has local players. We saw an opportunity in this to have a pan India presence. Distribution is another area that needed attention. Also, consumer branding is important.

    How did you take care of the content?
    We realized that if we were to be a major player, we needed to own content on a large scale. We acquired 7000 movie titles and have become the largest content owner, controlling one-third of the entire film production chain. We picked up content from different sources (including from Time). We decided to be the first company that deals with home video in all languages.

    Isn’t regional films a significant component of this?
    We have close to 1800 Hindi titles. The rest is regional – Tamil, Telugu, Marathi, Punjabi, etc. Besides, we have around 600 international titles sourced mainly from independent producers.

    But how do you source top content when the big Bollywood studios like Yash Raj Films have set up their own home video labels?
    We simply can’t. But there are many who don’t have their home video labels. And we ourselves will be in the film production business.

    Pricing seems to be an important strategy for Moser Baer. How much volumes do you have to reach to make this a profitable business model?
    People say that Moser Baer sells products at a low price. For us, price was the outcome of other factors; it definitely was not the starting point. Surely, we wanted to have a pricing that the masses would find attractive. So we priced DVDs at Rs 34 and VCDs at Rs 28. And it is not that we are operating under negative margins.

    When you start buying big Bollywood movies and have to pay a high content cost, will your operating margins not puncture?
    We have all kinds of movies. For me, a 1950 film is as important as Munnabhai as it will generate a certain amount of interest among a certain section of audience and be commercially viable. The concept of old and new movies are irrelevant. In terms of recent titles, we have films like Life Mein Kabhie Kabhie, Ek Chalis Ki Last Local. Apne has yet to come. We also have two films of Venus.

    How do you align with the international studios as they are already having exclusive distribution deals with the other home video players?
    We will be busy for a year with the amount of titles that we have. Even if we release 30 titles a day, it will take me over a year and I am not a magician. In terms of tying up with big international studios, the question is in terms of adding value. We are setting up our business. When we have established ourselves, then we can talk to other players with confidence and authority. We have to demonstrate how our business model works.

    How are you sprucing up your distribution network?
    When we were toying with the idea of entering into the home video market, we realized that we could have a strong backend but that does not necessarily make for a business model. Home video distribution, or for that matter the entire entertainment distribution, is wholesale-oriented. Entertainment firms have a few select group of wholesalers; what the wholesalers do after they get the product, nobody knows. We felt the need for a distribution network that is similar to an FMCG system. We wanted to have our own distributors spread across the country.

     

    Most home video businesses have 20-40 distributors across the country. We have 500. We feel that every town must have a distributor. We do not want to depend on a wholesaler in a large town who will cater to a small town. We tell distributors to give the product to retailers in their area. Entertainment product in this country is available in some 20,000 stores. Our product is available in 100,000 shops and we are just two months old. The aim is to take this to a chain of 300,000.

    What are the margins you are offering to the distributors?
    The wholesale distributor has a five per cent margin while the retailer enjoys a 25 per cent margin.
    ‘Home video market is fragmented and has local players. We saw an opportunity in this to have a pan India presence. We decided to be the first company that deals with home video in all languages‘

    How crucial is branding as part of Moser Baer’s strategy?
    The myth in the entertainment industry is that people just go and buy titles at any price and it does not matter who is selling them. We want to break that myth. Our message is that Moser Baer is adding a lot of value in terms of the quality of manufacture. We have a certain image. It is not just Munnabhai MBBS; it is Moser Baer Munabhai MBBS. It is important that we reinforce faith in our product in the mind of the consumers.

    Will you have your own stores as part of the branding exercise?
    We have two – one in Pondicherry and the other in Ahmedabad. We will have 50 by the end of the year and 250 by the end of 2008.

    How has the deal with Pyramid Saimira helped expand your reach?
    Pyramid Saimira makes and distributes films. We have the first right of refusal for home video rights. They also have a chain of theatres and have deals with malls. We are looking at opening Moser Baer franchisee stalls there. Our products will be available in the vicinity where people come. We are also talking to tie up with other theatre and mall owners.

    Are you looking at entering the rental market?
    Firstly, this is an unauthorised business. If someone buys a Moser Baer disc for commercial exploitation, then it is against the law. We do not have plans to enter the rental business. However, we are not trying to discourage this. If somebody approaches us to do business with them, we would consider licensing our content.

    How about getting into alliances with broadcasters so that you can acquire wholesome rights?
    We look at satellite content only if we find that we are not getting the home video rights. Do I need to align with other players? If I have 7000 titles and another firm comes up to me and says that he also has 7000 titles, then we might join hands to tackle the market together. This way we can take our own decisions that would be best for us.

    What are the plans on the film production front?
    We have signed a co-production deal with filmmaker Anubhav Sinha for a basket of 12 movies. We have also signed up with Anthony D’Souza (Ishaan) and Priyadarshan. We are also negotiating with four big filmmakers. The first movie to kick off, though, is Shaurya.

     

    We will also produce movies that we will release for the home video market. This should happen sooner than later. We also plan to get into the film distribution business but at a later stage.
    Are you looking at producing regional language movies?
    We have signed with Prakash Raj for three films in Tamil and are also looking at other languages. Our eventual aim is to make films in all languages.

    How much are you pumping in for your entertainment business?
    We intend to invest Rs 5 billion over three years. A major chunk of this, of course, will be towards the home video business.
    With low pricing, what growth can we expect in the home video sector?
    Our estimate is that it would grow at four to five times the current size in three years. We want to have a 50 per cent share of this.

    Is the home video market dynamics up for total change?
    Will consumers look at our price and wonder why other titles from other firms are priced much higher? Possibly. That is for them to decide. Some players may charge higher but eventually the price will come down from where it is now for everybody. I don’t believe premium or popular content can command a three figure price. The home video business model will be viable for those who are able to stay around in it.

    You have moved into HD DVD. Won’t the conflict between the two incompatible formats Blu Ray and HD DVD prevent quick uptake of the technology?
    This is still five years away from happening in India. VCD players still dominate, though the number of DVD homes is growing.

    Does Moser Baer nurture ambitions of eventually becoming a studio?
    Consolidation is happening in the entertainment space across the globe. This will also happen in India. Corporates are entering into the movie business and aggregation is taking place. We are also trying to be in the different entertainment value chains.
  • Fremantlemedia makes additions to drama catalogue ahead of MipTV

    Fremantlemedia makes additions to drama catalogue ahead of MipTV

    MUMBAI: Televisioon format owner and distributor FremantleMedia Enterprises (FME) has announced the acquisition of two drama shows which will launch at the television trade event MipTV in April.

    The shows are Love You To Death and The Best Years. They join FME’s expanding drama portfolio.

    The dark, funny Love You To Death stars filmmmaker John Waters Pink Flamingos, Hairspray in his television series debut as the ‘Groom Reaper’. It and tells the twisted, inspired-by-reality tales of spouses who have killed their loved, or not-so-loved ones.

    The series is scheduled later this year in the US on Court TV as ‘Til Death Do Us Part and Global Television in Canada. It will be on offer to buyers worldwide from FME at MipTV for both TV (excluding the US) and DVD (excluding Canada).
    As the ‘Groom Reaper’, Waters guides viewers through bizarre stories and cases of wedded woe, with his trademark wry sense of humour and definite macabre sensibility. Each episode – inspired by true crimes – dramatises the stories of ill-fated husbands and wives and reveals the flaws in what the killers thought was the perfect crime – like in the case of the ‘spend-a-holic’ spouse, who poisoned their other half to claim the life insurance, only to find that the cheque for the poison bounced! In each episode, viewers follow a murderous trail to find out whodunit and will be on the edge of their seats until the very end, as things are not always as they seem.

    The Best Years follows a group of friends through the ups and downs of college life. It’s an insight into the real-life drama that is university – the excitement and pressures that go hand in hand with newfound independence.

    Leaving her foster-home past behind, Samantha Best (Charity Shea) arrives on a scholarship for freshman year at the prestigious Charles University in Boston, MA and sets about finding her feet in the hallowed halls; not to mention finding a whole new set of friends – and ‘frenemies’ – along the way.

    As Samantha learns to juggle academic pressures, the perils of the social scene, friction with roommates and liaisons with lovers, The Best Years will be compulsive viewing as she and this sometimes dysfunctional college family make their way together.

    FME CEO David Ellender says, “We are delighted to add these two unique dramas from Blueprint Entertainment to our burgeoning portfolio of fine scripted entertainment, which we are committed to expanding further throughout 2007. We are thrilled to be launching both Love You To Death and The Best Years at MipTV. This gives broadcasters from around the world the chance to be the first on board with what will be very highly-prized additions to any schedule line-up for 2007.”

  • TV hardware market in Asia worth $22 billion

    TV hardware market in Asia worth $22 billion

    MUMBAI: The total size of the television hardware market in Asia measures at nearly $22 billion

    GfK Asia has released its 2006 year end pan Asian consumer electronics data summary. This highlights the trends in the region’s consumer electronics sector. The report includes data from 13 countries overall including China, South Korea, Taiwan and Hong Kong.

    For the first time, LCD televisions are the largest television category, equaling 40 per cent of the total market value, compared to conventional televisions (39 per cent), plasma televisions (18 per cent), and rear projection televisions (three per cent).

    On a volume basis, LCD televisions out-sold plasma televisions four-to- one in 2006. In all, more than 50 million televisions were sold by retailers in 13 countries across the Asian Region last year. In 2006, 83 per cent of televisions sold in Asia were conventional televisions, a figure that is predicted to slip to 75 per cent in 2007.

    GfK Asia commercial director of consumer electronics Steven Kaiser says, “The future is certainly bright for LCD screens in Asia. We expect that LCD televisions to continue a strong advance in 2007 and see a regional growth rate of 72 per cent for volumes in the year ahead.”

    Markets such as the Philippines, Thailand, and Vietnam that had seen relatively low LCD television volumes in 2005 exhibit robust increases in 2006 as the product gains a solid foothold throughout the Asian Region.

    Further evidence of the product’s vitality is seen in China where more than four million LCD televisions are reported sold at Chinese retailers in 2006 and is forecast to reach eight million units in 2007.

    DVD Player and Recorder: DVD recorders enjoy a banner year in 2006. The market value of DVD recorder retail sales across 12 countries in the Asian Region is nearly $500 million, representing 22 per cent of the overall DVD player market. On aggregate, more than 23 million DVD players are reported sold in 2006 in the Asian Region. The DVD player market is forecast to hold steady in 2007.

    Kaiser explains, “With the two next-generation hi-definition video disc formats finally becoming a reality, it is not surprising to see current-generation DVD players reaching a natural sales plateau. Yet, despite the impending ‘hi-def’ future, DVD recorders are actually flourishing in today’s market by offering Asian consumers a strong value proposition: a rich feature- set at ever-better price points.”

    Audio Home System and Home Theatre System: In the audio sector, a China boom is expected for home theatre systems next year when the market volume is forecast to increase by 33 per cent in 2007.

    The total market volume of audio home systems and home theatre systems combined in 2006 stands at just below four million units across the Asian countries measured. Regionally, no growth is forecast for home audio products in 2007.

    MP3 Digital Portable Audio Player and MP4 Digital Portable Video Player: More than 20 million digital portable multimedia players (digital portable audio players and digital portable video players combined) are reported sold in retail shops. Approximately six million of these devices feature playback of digital video; the number of these devices is forecast to rise to nine million units in 2007.

    Kaiser adds, “Such is the pace of technology. The digital portable video player segment did not exist two years ago. Today, video playback is a feature on nearly one-third of all players sold in the Asian Region. We expect memory prices will continue to drop and video content will become even more accessible, positioning digital portable video players as the likely successor to portable video disc players in the
    marketplace.”

    Portable Radio Player: The market for portable radio players is currently tracked in 11 Asian countries. The market size is measured at nearly $300 million. China and Indonesia have the largest base of consumers for portable radio players in the Asian region, with the total market volume measured as 2.6 million units and 1.5 million units respectively in each country in 2006.

  • Pyramid Saimira, Moser Baer in deal for home video market

    Pyramid Saimira, Moser Baer in deal for home video market

    MUMBAI: Cinema chain operator Pyramid Saimira Theatre has entered into a strategic alliance with Moser Baer India for exploiting revenues from the home video market.

    Under the arrangement, Moser Baer’s range of home video titles will be available at all the theatres owned or managed by Pyramid Saimira. “The space cost will be taken care by us while Moser Baer will spend on furnishing the shops where the home video products will be sold. They will be able to reach out to more consumers through this retail chain,” says Pyramid Saimira Theatre managing director PS Saminathan.

    Pyramid Saimira will also allow its new films for Moser Baer to release in the home video format after a short window period. The plan is to release 100 films in South India across the country. Moser Baer will kick off by releasing Pyramid’s new Tamil film Mozhi (released on 23 February). “The window period will be drastically reduced and our films can be available on Moser Baer’s home video after one month of theatrical release. We believe we can get huge volumes as the DVDs are to be priced at Rs 34,” says Saminathan.

    Adds Moser Baer CEO, entertainment business, Harish Dayani, “This strategic tie up offers an excellent opportunity to increase our retail presence and availability. We are delighted that Pyramid Saimira Theatre is going to offer their new Tamil film content in home video format for the first time within a short period of releasing the film in the theatre.”

    The profit will be split equally between the two companies. This will include revenue generated from advertisement in VCDs and DVDs. The availability of DVDs at such low prices is aimed at killing the piracy market while also expanding the home video segment.

    Pyramid Saimira has also agreed to release films produced or distributed by Moser Baer in its theatres. Currently Pyramid has 255 screens in 225 locations.

    “Under the strategic alliance if we manage to generate volumes in the home video segment, we hope to add Rs 500 million to our bottomline every year without any increase in costs. While we take the content risk, they run the expenses for production of DVDs,” says Saminathan.

  • ImaginAsian entertainment to distribute Korean thriller, Chinese drama in the US

    ImaginAsian entertainment to distribute Korean thriller, Chinese drama in the US

    MUMBAI: ImaginAsian Entertainment which serves the ethnic audience in the US with Asian television fare and South Korea’s Prime Entertainment have struck a deal to co-distribute Korean thriller A Bloody Aria in the US.

    Pic, scripted and helmed by Won Sin-yeon, sees a professor and his student become involved with three unsavory characters who may or may not be killers. It stars Oh Dal-su.

    Meanwhile media reports state ImaginAsian Entertainment will also co-distribute Chinese drama The Road with Easternlight Films. The plan is to roll out the film in theaters and then on DVD, VOD, pay TV and broadcast TV.

  • BKN inks 2 broadcast deals & toy deal for TV series ‘Dork Hunters from Outer Space’

    BKN inks 2 broadcast deals & toy deal for TV series ‘Dork Hunters from Outer Space’

    MUMBAI: BKN International AG, has announced that it’s wholly owned UK subsidiary BKN New Media Ltd, has sealed two new major TV broadcast deals with GMTV in the United Kingdom and RTL II in Germany as well as a pan-European master toy deal with Character Group for its animated action comedy series Dork Hunters from Outer Space.

    GMTV has acquired two seasons, totaling 36 all-new episodes of Dork Hunters from Outer Space and is set to premiere the animated action comedy series on free -TV GMTV1 from 2008. While RTL II has confirmed that the series will be set to launch on free-TV RTL II in late 2007, informs an official release. In conjunction with the TV broadcast deals, a pan-European master toy contract was signed with children’s toys and games company Character Group plc, the licensing company behind Doctor Who and Scooby-Doo among others in the UK and Europe.

    Character Group plc will launch in late summer 2008. At this stage they will license all standard “master toy” products, such as basic plush; feature plush; action figures; toy vehicles and accessories; playsets; activity, arts and crafts; interactive toys; boardgames; toy writing and school instruments; toy accessories including lipstick and make-up.

    BKN are handling all TV and DVD distribution as well as merchandising and licensing rights worldwide. BKN is planning a strong marketing and advertising campaign for the brand targeting the trade and consumers for this major launch supported in part by toys, videogames and on-line activities.