ITV

Tag: TV

  • TV and film production companies have a bumpy FY’10

    Television content production companies have had a bumpy ride during the 12-month period ended March 2010 as broadcasters cut costs and restructured businesses to tide over the recession.The listed TV content companies – Balaji Telefilms, UTV Television, BAG Films and Media, Creative Eye and Sri Adhikari Bros – posted a combined revenue of Rs 3.36 billion, down 38.32 per cent from Rs 5.44 billion in the year ago period. Barring Sri Adhikari Bros, which has low revenues, each company’s turnover de-grew during the fiscal.

    Realisation per hour of programming fell dramatically and the content creators had to work on squeezed margins. The existence of too many content companies did not make the task any easier.

    The listed companies, in fact, swung into losses at an operational level. The combined loss stood at Rs 25.79 millon compared to operating profit of Rs 186.73 million in the year-ago period.

     
    Expenses were kept under tight control as projects fell, amounting to Rs 2.25 billion, or a drop of 37.48 per cent.

    (We have taken UTV’s content financials which include airtime sales as they don’t disclose them separately. Also, expenses and net profit are not available for UTV and BAG separately).

    The movie production houses also had a rough patch as it was caught in a row with multiplex operators, cluttered releases and high ratio of box office disasters.

     

    The combined revenues of the five listed companies – UTV Motion Pictures, Cinevistaas, Pritish Nandy Communications, Mukta Arts and Shree Ashtavinayak – dropped 20.48 per cent to Rs 13.78 billion (from Rs 17.33 billion).

     
    On an operational level, these companies, however, posted a profit of Rs 1.43 billion, up 2.6 per cent from the earlier year.
    Expenses fell by 24 per cent to Rs 8.13 billion, as against Rs 10.71 billion in the year-ago period.

    The content entertainment revenue pie, in fact, fell by 24.74 per cent in FY’10. Revenue of the listed film and television production companies stood at Rs 17.14 billion, down from Rs 22.77 billion a year ago.

     

  • ‘Acquisitions, JVs – We mean business’ : Fremantle Media regional CEO Europe & Asia Pacific Simon Spalding

    ‘Acquisitions, JVs – We mean business’ : Fremantle Media regional CEO Europe & Asia Pacific Simon Spalding

    Simon Spalding is a bit of a homebody. When the Fremantle Media regional CEO Europe & Asia Pacific is not travelling around on business he likes to spend time with his family in Amsterdam.

     

    The 49 year old Spalding has close to a quarter of a century‘s experience in a career spanning toy marketing (with Hasbro Europe), licensing (Dreamworkz) and television (Fremantle).

     

    10 of those years have been spent in building Fremantle into the global TV powerhouse it is today. He set up the UK operations, built them up and, then moved onto Sydney Australia where he forged a merger between Grundy and Crackerjack to create Fremantle Australia. Today it probably is the largest Australian TV producer.

     

    He then moved back to Europe to oversee Asia and Europe, leaving the Asian operations in the able hands of Patrick Schult.

     

    Spalding was in India to touch base with the Indian operations of Fremantle India, which are headed by Raj Baruah and also meet up with broadcast executives at the leading Indian networks. The TV executive – who counts West Wing as one of his favourite TV shows – caught up with Indiantelevision.com‘s Ashwin Pinto on Fremantle‘s Indian initiatives and the vision for the production house.

     

    Excerpts:
     

    Was 2009 a difficult year due to the economic downturn?

    It was a better year than we expected it to be. We made our budget but in order to do that we took some things out that we had been saving for a rainy day. Last year we had a couple of rainy days. There has been a bit more of a time lag for producers as the first half of 2009 was committed in the second half of 2008. So the first half of last year was good and it got tougher in the second half. We are still feeling the impact this year.

     
    How do you see this year progressing?

    We have taken a more conservative position regarding our budget. We have recognised that we will be a slightly smaller company this year. But overall the interesting thing is that our big shows are getting bigger. So while everybody was concerned that shows like Idol or Got Talent would also suffer in the recession, the fact is that we are getting a larger audience share. It is also encouraging that more people are watching television than ever before. If you have the right content and can produce it at the right price there is market out there for it.
     

    At this point which are your top five formats?

    Our big three entertainment formats are Idol, X-Factor and Got talent. Our game shows are strong like The Price Is Right which has been around for 54 years. It was the number one daytime show in France after being reintroduced after an eight-year gap. This show has been reintroduced in nine other markets. Fremantle is also a drama producer. Our serial dramas do well.

     
    What additions have been made to your catalogue recently and are you looking at more genres?

    We look at new genres. We brought 10 new formats to MipTV. Some were reversions of existing catalogue. Some we develop ourselves and some we do in partnership with others. We have a show Push The Button which has been done with Gallowgate which is owned by the guys who host Got Talent for us in the UK. We constantly look for new ideas. We recently picked up a new cooking format from Romania. It is a reversion of a classic show called Give Us A Clue.

     
     ‘Historically we have come in on the back of a successful show. Once that show fell away we did not invest in building infrastructure and a broader base to sustain our business (in India) . This time we have come in to build a base. We have a detailed business plan.‘

     
    What goals have been set?

    From a company point of view we are trying to do three things. We want to continue to build and develop our network. We have production companies in 22 countries. We want to strengthen those. If we have a strong entertainment business, for instance in Denmark, we focus on building a drama business. In Italy the situation is the reverse where our drama business is strong. There is already this piece going on as well as looking at new markets. Last year we opened offices in India and Brazil.

     

    The second part of what we are doing is to build and grow our creative pipeline. The content that we bring to the market is what is going to drive our business forward. So we have made significant investments in developing original content and also in partnerships with third parties.

     

    The third part of our strategy is building new capabilities. As the world changes, different platforms emerge and people want to use IP in different ways. We are looking at the skill sets and resources that we need available to help build that. This would encompass developing our live show business, gambling business. We want to grow in these areas too.
     

    How much business comes from Asia in terms of business generated? Which are your top three markets?

    Not enough business comes from Asia. I cannot give you a split though. India, China, Indonesia and Japan are our priority markets in Asia. These are the markets where we have production capabilities. In the other territories we have partnerships or licensing operations. We have nailed down

     

    what we want to do in the markets mentioned earlier. Where do we go next? Do we want to open more production capability?

    We have a strong licensing and co-production business in Vietnam. This is a market where at some point we should open a business. The Philippines is also important. We are trying to balance the benefit of having a local production capability against the cost of a startup. In the current economic circumstances it is a tough decision to make.

     
    Are you still an acquisition target? And how is the RTL ownership helping you?

    We are 100 per cent owned by the RTL Group. RTL is 91 per cent owned by Bertelsmann. They are happy with Fremantle as we have shown a compound annual growth of 9 per cent in revenue and 13 per cent in EBIDTA over the last six years. That makes for a happy shareholder. We can access investment funds. I just bought a company in the Netherlands as I want to strengthen our drama business there. We also made an acquisition in Italy which gives us more content. RTL Group CEO Gerhard Zeller has publicly said that Fremantle is not for sale.
     

    What is your vision for India?

    What I am looking for is a successful locally driven production company that takes full value from the Fremantle network and also contributes back to the network. The Indian group should take programmes and IP and bring them to India. Also over time they should develop things that travel broadly within the Fremantle network.

     
    Will Fremantle be open to considering paper formats from Indian creative professionals?

    We do look at them. Obviously they are much tougher to get to but you have to start somewhere. We would look at an original idea when we have identified a customer. A programme idea is only good if you have a customer to sell it to. Once we have found an idea that we can link effectively to a customer that is when we can offer support to bring that idea to a pilot or a series. Once we have tape then we can start pushing it around our network.

     

    An example is a format developed in France but we could not find the right customer for it there. We found a customer in Australia. On the basis of this successful launch we took it to other territories. The format is Take Me Out.

     

    You have made efforts to set up office in India earlier but retreated? What makes your current foray any different? What kinds of investments are you looking at pouring in here?

    Historically we have come in on the back of a successful show. Once that show fell away we did not invest in building infrastructure and a broader base to sustain our business. This time we have come in to build a base. We have a detailed business plan. We have a detailed idea of how much money we need to spend and when we expect ROI. The company has signed up for a longer term vision.

     

     
    Endemol has raced far ahead of you here. Zodiak is doing well with SOL. Disney has found customers for its products here. Are you coming in too late?

    The decision for us to withdraw from the market just before I took over the role was perhaps short-sighted. My ambition was to get back as the Indian market watches the kind of television that we produce. India has a range of free to air broadcasters who would want to buy our content. Why would we not want to be in India which is a growing market? The aim is to build a solid foundation and not try to run before we can walk. We don‘t just want to be in entertainment. We want to be in multiple genres.

     
    Is Fremantle also considering taking a stake in a local production house to complement your non fiction business?

    If there is a strategic fit we would look at it. There are other business models. It could be a JV or a partnership. It could be investing in creative people and giving them a place under the Fremantle umbrella. We don‘t have a one size fits all approach.

     
    ‘What I am looking for is a successful locally driven production company that takes full value from the Fremantle network and also contributes back to the network.‘
     

    For this year what is your priority?

    We have to deliver shows that we already have an order for. Indian Idol was our number one priority for Sony. We also focussed on getting our relationship with Colors correct for Got Talent. We want to establish our credibility as a serious content producer in India. You can talk about lots of things but until delivery happens it is only talk.

     
    Do you think the Indian broadcasting and production business is receptive to formats as it is in other developed markets such as the US, the UK, Australia, Malaysia? Are they willing to pay for formats or are they more prone to rip-offs?

    There are examples of formats being ripped of here. Once a successful format is launched there is a temptation on the part of other broadcasters to put something similar into the market. Indian Idol success is a testament to the strength of the IP. Viewers feel that it is worth sticking with. Broadcasters know that they can get away with ripping off stuff once in a while however, they also know that they need the best content and to get that they need to find a way to work with the people who own that content.

     
    American Idol has lost share in the US partly due to the fact that the format has gotten stale. How is Indian Idol faring?

    This year we have made a significantly better show. The talent is stronger and the production is better than it has been for a while. We had a strong launch. The numbers dipped. The test is if we can deliver what Sony expects and what viewers want.
     

    What new formats are being brought to India?

    We are meeting broadcasters. We are trying to fit our shows with the specialities of broadcasters. Every network wants differentiated content. Our entertainment shows have a lot of potential. We are sure that X Factor will be in the market soon. Historically our game shows have done well. So we will bring in some of those. Comedy will be more challenging as it may be tough to translate but I want to do this genre in India. We have some factual content that we feel the market is increasingly ready for. I want to do drama but we are not yet ready.

     
    Are you going to be going into the languages area? Tamil, Telugu? Endemol has done that well.

    This is an area that we have identified and it is a question of building the organisation so that when we make this approach we are capable of delivery. A number of game shows would work here. They are cost effective to do in multiple languages. For instance for Family Feud you could build one set and then bring in different hosts, different families, audiences.
     

    Has there been any learning from other Asian markets that you would look to apply here?

    We have to accept shorter pre-production times. We have figured out how to produce formats that have worked in Europe here though the cost structures are different and circumstances are different. We have learnt about cultural sensitivities. We make three versions of a dating show in Indonesia. We have figured out how to do it in a way that is culturally appropriate. You also figure out when something is culturally inappropriate as opposed to something that they do not want to do.

     
    Most of your shows are upscale. India is discovering rural, massy content. What plans does Fremantle have here?

    We have IP. What our Indian team has to do is sift through them and decide what could work depending on the environment. They have to identify gaps that can be filled locally. That is what we do in different countries. Americans do not just pick up everything that is developed. They pick up some stuff and develop other content that is appropriate. This is also true for the UK, Germany, and France.

     
    Also, there seems to be no differentiation among the Indian general entertainment channels. Nobody wants to take a leap. Do you see innovation happening?

    I am optimistic that it will happen. What we have seen globally is that companies which have innovated and done different stuff have step-changed their position in the market. For us, I accept that we will need to create formats here that travel. That will be a step-change for us.

     
    In the format business what trends are we seeing?

    We are seeing more uplifting themes being popular. So if it is a reality show then one about success works rather than celebrating disaster. In drama the themes are not as dark. There is more comedy coming through. There is more subject matter considered niche like cooking that is growing. They do well not just on lifestyle channels. They have gone mass market.
     

     

    Could you elaborate on the plan for the production services division and what is its USP vis-a-vis what is already available?

    The combination is that we have a huge catalogue of IP coupled with a group of people that can produce it as they are linked in to the Fremantle network. Our team understands how to produce shows here and the shows have worked well abroad. Talent, IP and international support are what we offer.

     

    The market consists of local companies which are developing their own IP or buying IP and produce it here. Fremantle is unique in terms of how it is networked. No other company comes close to our ability to move information around and support productions apart from the BBC. They are obviously very different. Endemol and we are the main global players.
     

     ‘What we have seen globally is that companies which have innovated and done different stuff have step-changed their position in the market. For us, I accept that we will need to create formats here that travel. ‘
     

     
    The Indian television general entertainment market has seen growth and also some consolidation. How do you see it progressing and what are the challenges that general entertainment broadcasters will face?

    The economic circumstances will continue to be a challenge. How the advertising market responds to the economic environment, the shift in advertisers‘ priorities between television and other media is a concern. Secondly, they have to remain distinctive and at the same time attract the broadest possible audience. A balance has to be struck. You need to have a personality while not alienating people whom you want to attract.

     

    Channels have to figure out how to get high quality content whether it is sports rights, news etc. They have to maintain the right relationships to deliver desired content.

     
    You see foreign players actively looking at India, the latest being CBS. How will this change the market dynamics from your point of view?

    Competition is healthy. But is enough investment being made to train people who you will need to run businesses? This is a concern. If this is not looked after then staff will be poached and there will be unpleasant salary inflation. If international companies bring in expats then it would be a step backwards.

     
    Could you talk about the strategy that Fremantle follows in exploiting brands beyond the television screen?

    We look at it in terms of what we term the wheel of value. The hub of the wheel is content. We look at spokes that can be used to exploit that property. Is there a format, a tape sale, home entertainment piece, an Internet experience, a mobile experience? A brand like Idol fills in most of the spokes. The Price is Right also lends itself to various activities. However, a factual entertainment show may not fill many spokes. You can sell this show in many territories but you do not get the mugs and T-shirts part of the business or the live show.

     

    For The Price is Right we sell the American version in some territories. We also have a DVD. We have multiple online versions where you can play for prizes, fun, and money. We have lottery scratch card elements. We have merchandise like a board game, mugs and T-shirts. We have a gambling version through slot machines in casinos. We have a live version of the show in America. We have sold it to a casino in Belgium. We have also developed a mobile application which has had 500,000 downloads on the iphone. The only thing that we have not done is a film.

     
    Are you looking at creating content for the mobile in India with 3G coming in?

    We have done a number of shows specifically for the mobile or net. The challenge is to create a business model. We have experimented. We have an online comedy service Atomic Wedgie in the US. It has translated into a TV show. We have done other stuff like cut down versions of Baywatch on mobile.

     

    We are not making much money but we are learning. We are investing rather than losing money. We did a show for MySpace where we went to find interesting people on this social network.

     
    How is the iCount viewer research panel helping Fremantle understand viewers better?

    We rolled this out in Germany. We are about to launch it in the US. It allows us to get very fast feedback from engaged viewers. It does not substitute other forms of research that we do. It allows getting a fast read on what would engage viewers. We can do more pre-testing. So for instance, if you want to look at a storyline in Neighbours, you can talk to those engaged viewers and get a read on whether they think that it is something they feel that we should be doing or not.

     

    We can test out casting, validity of characters and get a read on other things going on in the market. We get feedback on where people are watching stuff, what they are listening to and how they spend time. It gives us a more complete viewer of the consumer at a reasonable cost.

     
    Are you planning to introduce this for India?

    We will roll it out on a territory by territory basis. Australia is probably going to be the first place in the Asia Pacific region where we will roll this out. In India and Indonesia do we have enough shows where the iCount panel could influence? If you only get feedback on stuff already done it is interesting, but may not be useful beyond a point. I probably will not roll this service in China.
     

     

    Has Fremantle cracked the social media puzzle and taken advantage of the buzz going on there?

    I will go back to the point about developing new capabilities. There are processes and techniques going on in that world which need skill sets that are different. What we have to figure out is what we can contribute from our existing skill set to the party. We are playing around the edges of social networking, social gaming. We realise that we as a company need to take more positive steps in this direction. For us gaming is a separate skill set.

     

    It is a big move for a television production company to say that it also wants to get into gaming. Similarly gaming companies like EA took a while before deciding to enter the entertainment business. Gradual steps were made and now there is more cross over. While the Tomb Raider and Prince of Persia games were made into movies, it took quite a while before that crossover happened.

     
    Four years down the line will Fremantle be among the top production companies in India or would it have wound up?

    India is a territory that we will never be able to not be in. I want us to be a production company that people trust to bring them high quality content. We need to have a range of customers providing a range of genres across a range of price points. We have to be a full service production business.

     

    The more interesting question is whether we will just be a production company? How will we characterise ourselves three years from now? We already talk about being an entertainment business and not a production business. How we evolve will impact the way in which we develop here.

  • ‘IPL franchise ownership seems to be driven by celebrity rather than commercial reality’ : Intangible Businesses valuation director Richard Yoxon

    ‘IPL franchise ownership seems to be driven by celebrity rather than commercial reality’ : Intangible Businesses valuation director Richard Yoxon

    The Indian Premier League (IPL) defied financial gravity at a time when the world was struggling to fight the menace of recession. Even as capital became scarce, the world’s hottest cricket property managed to renegotiate a nine-year broadcast deal in 2009 for a whopping $1.6 billion. The earlier agreement, signed a year ago, had valued the TV rights for $1.03 billion over 10 years.

     

    The temporary refuge in South Africa was a welcome aberration, establishing the IPL as a global property. In 2010, the IPL became bigger and better as it attracted larger audiences, costlier sponsorship deals and fatter franchise bids, growing the cricket economy.

     

    Then came the Lalit Modi saga and charges of match-fixing, rigging of bids, financial irregularities and betting. The architect of the IPL is now suspended and a clean-up exercise has begun.

     

    A parallel has often been drawn between the IPL and the English Premiere League (EPL) that houses some of the world’s iconic soccer clubs including Manchester United.

     

    The IPL, however, has a big mountain to climb. Its TV rights, the main revenue supply for the entire structure including the teams, went for much less. Last year the EPL‘s TV rights bundles were acquired for $2.6 billion for 3 years. And it‘s not just a big difference in value. More importantly, the EPL‘s TV rights will be renegotiated twice before the IPL‘s current deal expires.

     

    But the IPL is just three years old and has seen a stupendous growth. It can learn important lessons from the EPL as it scales up, including doing shorter term TV deals in future as the property gets well established.

     

    The IPL team owners should also be cautious in not repeating the mistakes committed by their EPL counterparts. Some of the EPL club owners have funded their acquisitions through huge debt and have gone on to pay unrealistic amounts to purchase players. In fact, the EPL clubs are popularly known as the ‘rich boys‘ toys‘ that appeal to the owner‘s ego and vanity.

     

    In an interview with Indiantelevision.com‘s Sibabrata Das, Intangible Businesses valuation director Richard Yoxon talks about the challenges that sports properties face as they grow up to be run like big commercial businesses.

     

    Excerpts:
     
     
    Will it be right to compare the IPL as a potential sports property that can grow to the scale of the EPL in future?

    I think the IPL has more in common with the American franchise sports such as NBA and NFL than with the EPL. The success of English football was built on interest from local communities and commercialisation came a lot later. American sports and the IPL, on the other hand, were created and driven by commercial objectives.

     

    Football is the major sport in most countries. NBA, NFL and baseball are only major sports in the US while India is the only major economy where cricket is the number one sport.
     

     
    Can the IPL leapfrog?

    On the basis of global appeal, the IPL will never come close to the EPL. Commercially it‘s possible due to the size and growth of the Indian economy, but I think it‘s unlikely except in the very long-term as in a global context cricket is small beer compared to football.

     

    In a renegotiated deal in 2009, the IPL‘s TV rights went for $1.6 billion for 9 years. In contrast, last year the EPL‘s TV rights bundles were acquired for ?1.7 billion ($2.6 billion) for 3 years. A very big difference. More importantly, the EPL‘s TV rights will be renegotiated twice before the IPL‘s current deal expires.

     

    England has 3 professional leagues below the EPL and over 90 professional clubs!

     

    The Indian economy (2009 GDP $1,235 billion) will need to be multiple times bigger than the UK economy (2009 GDP $2,184 billion) for the IPL to leapfrog the EPL.
     
     

    Several EPL clubs are sunk in debt while the IPL has run into controversies very early in life. Do you see sports businesses being in trouble across the world?

     Not many football clubs currently or historically make a profit. It is often suggested that the clubs are ‘rich boys‘ toys‘ that appeal to the owner‘s ego and vanity. Football clubs are trophy assets rather than profit centres. This is a key similarity as I think IPL franchise ownership seems to be driven by celebrity rather than commercial reality.
     

     
    Are the allegations of match-fixing, rigging of bids and betting going to impact the IPL as a brand?

    The events are certainly not helpful but the impact will be minimal in the long-term if the BCCI acts promptly and transparently to address the problems. The Indian public loves Twenty20 cricket and the competition‘s format. This love affair with the game is not going to change as long as the game is cleaned up commercially. What‘s the alternative? I can‘t imagine the Indian public switching to football, hockey, kabaddi or even test cricket with equal fervour and enthusiasm.

     
     
    What is the IPL worth in value after 3 years of existence and how does it compare with the EPL?

    I think there is nothing wrong with the progress made to date by the IPL. I think the BCCI / IPL has done amazingly well in a short space of time.

     

    But we haven‘t valued either brand. Brand Finance valued the IPL brand at $4.13 billion, but I struggle to understand how the brand of a business whose main source of income is a 9-year TV deal for $1.63 billion can be worth so much.
     

    ‘IPL franchises certainly do need to scale up to justify the high franchise fees. The amount they need to scale up in the time available appears unrealistic‘

     

    But you have valued the IPL franchises and they are much below that of Brand Finance‘s estimates. Why?

    Brand Finance is, perhaps, more optimistic than us. Regarding the IPL, they have more ambitious growth rate projections and are less conservative in discounting.

     

    But if you look at our valuations, the top four teams are almost having similar values (Royal Challengers Bangalore at $37.7 million to Chennai Super Kings‘ $36.1 million). There can‘t be any particular team breaking too far ahead at this stage because there is no big difference among them. The difference is mainly due to the size and level of interest in the IPL franchise‘s catchment areas. Rajasthan Royals ($27.5 million) is distinctly disadvantaged compared to Royal Challengers Bangalore and Mumbai Indians (5th at $32.7 million).
     

     
    Do you see revenue streams a big problem with the IPL teams?

    They certainly do need to scale up to justify the high franchise fees. The amount they need to scale up in the time available appears unrealistic.

     

    As far as licensing and merchandising revenues go, the IPL franchises can tap their growing fan base. There will be a limitation, though, if you compare it with EPL clubs like the Manchester United where the shirts are even bought by the Japanese or the Chinese. The IPL team merchandise will find it difficult to cross the global boundaries and communities outside the Indian diaspora.
     

     
    What are the lessons the IPL needs to learn from the EPL?

    The IPL needs to negotiate shorter TV deals. I suspect that the IPL‘s 10-year deal (renegotiated deal after a year is for 9 years) was driven by necessity as the concept was unproven at the time of the negotiation. A longer deal was probably needed to get to potential franchise owners on-board by providing the assurance of guaranteed revenues and media coverage over a sufficient period to justify the initial franchise setup costs.

     

    The IPL is a closed shop. There‘s no promotion or relegation. Teams should earn the right to play in the IPL rather than buy their way in. The British public loves an underdog (hence I follow Rajasthan Royals in the IPL) and it is great for the sport when a small team gains promotion to the EPL on a shoestring budget and even beats one of the big names (Burnley won promotion to the EPL last year and beat Manchester United in their first home game).

     

    It is equally interesting when the big teams face the threat of relegation despite significant investment in players (Newcastle relegated last year). Relegation also maintains interest for longer; once teams are out of contention to win the IPL there‘s little to play for. It would be good to see the IPL develop feeder leagues to give smaller cities the opportunity to develop teams and aspire getting a sniff of the big time.
     

     
    When did the EPL commercialise?

    Football is a fabric of British society; it has been developed over 120 years. But the first big step towards commercialisation was when TV deals were renegotiated in 1992. Twenty top clubs separately negotiated for TV rights, which became the main driver for their increase in revenues. Previously, the TV rights were negotiated collectively for all the 90 clubs.

     

    Merchandising is a huge income for certain big clubs like the Manchester United. But for most of the clubs, the main income is from TV. Portsmouth, for instance, reported a total income of $60 million last season, out of which $40 million came from TV.

     
     
    Why has the enterprise value of the EPL come down recently?

    The same reason as any other market or business. Recession! Leisure and entertainment expenditure is cyclical. It‘s to be expected that consumers spend less on leisure and entertainment during recessionary times. In the medium and long-term, leisure and entertainment is a fast growing but highly competitive market.

     
     
    Why have the EPL clubs amassed huge debt?

    Two reasons. First, leveraged buyouts. Manchester United and Liverpool were bought by Americans using debt finance which was pushed onto the club‘s balance sheets. The clubs did not create these debts.

     

    The second reason is bad management – spending more than the club can afford in the hope that any resulting success will pay for the gamble.
     

     

    Is there a current crisis?

    What crises? The EPL is as popular as ever. Football clubs going bust is nothing new. The fans suffer in the short-term but the club survives.

     

    There are no major threats to the EPL. It‘s been going on since 1888 (rebranded in 1992); it‘s survived two world wars and hooliganism in the late 1970‘s / 1980‘s. The current exchange rate and increased income tax rates make playing in England less appealing financially for the world‘s top footballers. This has yet to have an effect but this summer I expect we‘ll see less big name players than usual moving the EPL in favour of Spanish, Italian and German leagues. This will not affect popularity in the UK but may have an impact on global interest in the medium term.
     
     

    Have foreign owners contributed to the financial mess?

    International investors have actually made the EPL economy much bigger. The problem has been with the buyouts being funded by debt and the purchase of players at a very high price. 
     

    Does the EPL need a restructuring?

    No. Some clubs need probably restructuring but the EPL is a profitable business. The supporters of several clubs would like new owners (Manchester United, Liverpool). Overtime, I suspect and hope that we will see more clubs owned by supporter‘s trusts, similar to the Barcelona model.
  • ‘We are completely format and genre agnostic’ : Channel [V] GM Prem Kamat

    ‘We are completely format and genre agnostic’ : Channel [V] GM Prem Kamat

    Badly bruised by MTV. Not really. Not really. Channel [V] has turned around to the same formula – cut down on music content while adding reality format shows.

     

    The overhaul to fit into the garb of a youth channel is beginning to pay rich dividends. Channel [V] has shored up its ratings and, more importantly, the brand is being polished to cater to an expanded audience base.

     

    Channel [V]‘s focus is on the seven metros. That is where its grip on audiences is strengthening as it tries to catch up on market leader MTV.

     

    In an interview with Indiantelevision.com‘s Gaurav Laghate, Channel [V] GM Prem Kamat talks about the drive to expand the brand across TV, internet, mobile and on-ground platforms.

     

    Excerpts:

     
     
    It‘s been more than three months since the relaunch of the channel. How has the response been so far?

    It‘s been fantastic. Actually, it has surpassed all our expectations…both from a market share point of view as well as the revenue standpoint. The kind of upswing that we are seeing is absolutely phenomenal. When we started out- even before the revamp when we began changing things around the channel and getting some basic things in place, transforming the kind of music we play, all of it – we were having a 0.2 – 0.3 per cent share. And as per the latest data, our share now has increased to 0.81.

     

    That‘s actually a fourfold increase. We were expecting to be at this stage probably in the next five to six months down the line, but we have reached that point already.

     

    Also, shows like Dare 2 Date have become hugely popular. There are websites dedicated to it. There are fan pages on Facebook and popularity is huge.

     
     
    But how do you see competition with MTV and Bindass who are much ahead in viewership and targeting the same youth audience?

    The case is pertinent to the time when we started out. However today, MTV‘s share is 1-1.2 per cent while we stand at 0.8. Thus, our gap with MTV has significantly narrowed.

     

    Talking about focused markets, we have been always ahead of Bindass. So for the slice that we take amongst the youth, we have been consistently ahead of Bindass. Specially, post the relaunch.
     
     

    But the Tam data does not show the kind of growth that you are boasting of. You talked about your focused markets…
    As you know, slicing the audiences is a game that people play to suit themselves. We always maintain that we are a youth channel; we focus on the seven metros. So we are an upscale urban youth portal, channel, medium… whatever you call it. And 15-24 is really the age group that we define.

     

    So that‘s really the set of people we talk to.

     
     
    But just the seven metros. Don‘t you think youth is scattered across?

    It is. But I think it is very important for us to define what our focus areas are and which are the places we wish to operate. When you say seven metros, it still counts to about 55 per cent of the Tam markets. So it is a significantly large percentage of the population.

     

    In terms of consumption, for most brands these seven markets will contribute to over 60-70 per cent of their volumes. In terms of television viewership, these again contribute about 60 per cent of the total viewership. So it‘s really about saying that, of course Channel [V] is consumed outside these seven metros, but every time we create something when we use audiences as a guiding force for the kind of stuff that we should be doing, these are the markets that we talk about. And hence, everything that we measure revolves around these markets. These are the set of people we are catering to.
     

     
    Coming to shows, music channels are shrinking their music content while upping their format shows. Is this the inevitable model?

    No, not necessarily. I really believe it depends on how you define your own programming philosophy. I think there are two ways to approach this. One is by staying faithful to the genre, second is by staying faithful to your audience.

     

    At Channel [V] we always say that we are going be faithful to our audience and not the genre. So, if a 15-24-year-old wants to consume a certain kind of content, that‘s the kind of content Channel [V] will put up.

     

    We do not believe that we are a channel which stays faithful to the genre. This particular audience has a wide variety of interests. It is our endeavour to try and reflect every aspect of that in the edgiest, the most interesting and most entertaining form possible. That is what you will see happening on our channel as well.

     

    It‘s not that Channel [V] has stopped playing or showcasing music. A large part of our content is still music, but we have taken a conscious call to move beyond music and get into a whole series of different things.

     
     
    ‘We are seeing Channel [V] as not just a television channel but as a brand with legs like TV, internet and mobile. In short, an all round engagement platform‘

     
     
    MTV had started the transition in 2007 when it shed its music content from 80 to 60 per cent. Now it is just 20 per cent of their programming. Is Channel [V] taking the same route?

    Like I said, it‘s not a decision that is driven by the genre at all. While I cannot comment on MTV‘s stand on this and how they are approaching it, our take is very simple. We pride ourselves on having a very strong pulse on what the consumer needs and what our target group enjoys. Our endeavour is constantly to be on the ball as far as this consumer pulse is concerned. Our content mix will always be a reflection of this.

     

    If the genre shifts in a completely new direction tomorrow, and the trends indicate that the youth choices are changing, that will be the direction we will take.

     
     
    Currently, your music content share is 60 per cent. Are you planning to cut it further?

    Currently, the kind of yield that we are getting from our shows is very good. But that doesn‘t mean that we are going to abandon music and populate the whole channel with shows. There are a variety of other constraints and considerations to take into account.

     

    This is the content mix that we decided on at the beginning of the year in July (as per News Corp‘s financial calendar) and we intend to continue this till at least June-end. Then, we will take a call on our content again.

     
     
    So with your revamped programming, you mean that youth is more interested in reality?

    Absolutely. I think it is fairly clear for everybody to see that. And it is not just reality. Reality is just a format, a form of programming. We are not constrained by that at all; we are completely format-agnostic and genre-agnostic. So it does not matter to us if the show is reality or fiction or documentary. What matters is whether it interests our target audience. And we have ample evidence all around us to say that their interests go far beyond just mere music.

     

    For example, our show Campus Buzz can‘t be put under any genre. Here students make video blogs and submit it to us. It is user-generated-content on television, but the engagement is also online.

     

    These are things that are representative of how we can push beyond the boundaries of genre and reality and fiction or non-fiction content.
     

     
    Also the cost of content for these kind of shows is very small?

    Absolutely, because a large part of it is user generated. We do guide them to some extent. But you are right in saying that the cost of producing something like this is very very small.
     
     

    But isn‘t the cost higher for other reality shows like Exhausted, Kidnap, or [V] The Player?

    Different shows have different cost structures, depending on what you are doing with it, where the shoot is, who you are getting and length of the shoot. But yes, on a ‘per half hour‘ basis, creating your own custom programming is more expensive than playing music. But it also offers you the advantages of creating something that is unique, something that is differentiated and something that is much more of a fit with your brand personality. And most importantly, creating something that the audience will find engaging and interesting.

     
     
    But is the revenue also looking up?

    Yes, because what these shows also do is provide you with customised solutions for clients. When someone (client) comes to Channel [V], it‘s not merely for the reach or for the conventional matrix of reach and frequency. They select a channel like us for the kind of engagement that we provide with the audiences. I think it is fair to say that a consumer of Channel [V] is far more involved with the brand than let‘s say the consumer of a regular conventional GEC (general entertainment channel) or a movie channel for that matter. That is really the advantage we can offer to the advertisers.

     

    What we bring to the table is a far higher degree of engagement with the viewers and far greater avenues of engaging with these people than just playing a 30-second commercial.

     

     
    Coming to promo properties, Channel [V] has created characters like Quick Gun Murugan, Lola Kutty and Sampoo Singh. Has the focus shifted now?

    Not really. Probably there has been a lull in the last two years for various reasons. But it is not that we have stopped. For example the ‘Bai‘ on Channel [V] that says Itne Paise me itna hi milega. It‘s something that the Bai said on Channel [V] and has become a very popular lingo.

     

    We are also creating more characters. Bai has been joined in by Bhai, her brother who is on-air right now. Things like these catch on with the audiences on their own…we can never promote these. Our best bet is to create these characters and put them out to see what happens. It will be very arrogant to believe or to say that we can create these characters at will.

     
    Do you see the no-appointment viewing pattern as a problem for youth channels like yours?

    For certain shows yes, for certain shows – no. Channels like ours don‘t have the kind of appointment viewing that a GEC has. Therefore, all of us follow an alternative model of airing a high number of repeats. If on a GEC a show repeats once or twice, on a channel like ours it will repeat 11-12 times. It gives us an opportunity to far more sample that show.

     

    The business model for us is a combination of attempting the scheduling in a different manner and finding new avenues for more consumption, whether it‘s online or mobile.

     
    So that is why you are more bullish on internet?

    Exactly. If you see our revamped website, only 10 per cent is about the content that we put on TV. It is our firm and unshakable believe that people don‘t go online just to see what is on TV. Hence, even if the website caters to the same kind of audiences and the same areas of interest, it does so in a manner that is suitable much more for the internet.

     

    You will find a lot more articles and advises on youth-centric issues, love and relationships. It is created exclusively for the internet, though it is for the same set of audiences.

     

    How does the strength of a network like Star help Channel [V]?

    It gives us a very strong platform to promote our shows. It is also a very strong source for driving in efficiencies, weathering cost efficiencies, and learning. Because of the network, we have far more channels from where we can learn or cross pollinate ideas. Also, we can source content on a much larger scale, which gives us a cost advantage. 

     

     
    What is the way going forward?

    You will find that we will continue to do shows. Internet as well as mobile and digital will become important for us. On-ground is also another important proposition. We are planning to take our brand on-ground on a grand scale.

     

    We are seeing Channel [V] as not just a television channel but as a brand with legs like TV, internet, mobile and on-ground. In short, an all round engagement platform. 

  • ‘The ICC will continue to manage its economics on a global basis with India as a key market’ : ICC CEO Haroon Lorgat

    ‘The ICC will continue to manage its economics on a global basis with India as a key market’ : ICC CEO Haroon Lorgat

    Wearing the International Cricket Council (ICC) hat isn‘t an easy job these days. With the Indian Premier League (IPL) becoming the new economic powerhouse, scheduling international cricket can be a tough task.

     

    The challenge of the ICC is to ensure that a balance is maintained between the three formats – Test cricket, one-dayers and T20 – of the game as each has its own attraction and value proposition.

     

    The other task is to take the game to new markets including the US and China. The ICC has set aside $300 million for the development of the game.

     

    With the BCCI (Board of Control for Cricket in India) gaining superpower status in world cricket, the role of the ICC is to manage its economics on a global basis with India as a key market.

     

    In an interview with Indiantelevision.com‘s Ashwin Pinto, ICC CEO Haroon Lorgat talks about cricket continuing to be in a healthy state as it has three viable formats of the game running at the international level.

     

    Excerpts:
     
     
    How would you describe the health and state of cricket at this point of time?

    Cricket is in a very healthy state at present. We are fortunate to have three viable formats of the game at the international level – Tests, ODIs and T20Is. Having these three formats is a huge opportunity that offers our fans, sponsors and broadcasters different options. No other sport can boast three viable formats of the game at international level.
     
     

    What is the ICC‘s strategy going to be to ensure that all formats of the game co-exist?

    Depending on how all of us collectively manage the game, we believe that all three formats can survive because each has its own attraction and value proposition: Test cricket has its endurance, cut and thrust, and its tradition of more than 130 years and, importantly, it is regarded by the players as the ultimate format. It is the benchmark by which they will be measured.

     

    ODIs have a history of their own with nine ICC Cricket World Cups stretching back to 1975. This format offers a chance for sides to recover from difficult situations while still affording a result in a single day.

     

    It boasts the biggest attractions in the World Cup and largest team prize in the game.

     

    Twenty20 is a great new attraction and vehicle to develop the game at domestic level. This short and sharp format draws new interest and allows tournaments to take place over a short period of time.

     

    It is important that the ICC and our members get the balance right, particularly in terms of scheduling.
     
     

    What measures are being taken to protect Test cricket‘s status as the pinnacle of the game?

    There are three important factors – competitive matches, context and the spectator experience. Improvements can be made in all of these areas and we are working with our members to achieve this.

     

    Some current examples of this are the current investigation into developing greater context for Test cricket, the possibility of staging day/night Test cricket in territories that would benefit from that, and more effective and consistent marketing and promotion of Test match cricket.
     
     

    Could we see the day night concept being introduced post 2012 for Test cricket?

    We need to make sure that Test cricket is accessible to the supporters that want to watch it. The indications are that in some markets supporters may be more interested in watching Test cricket, at the venues and on television, if it is played in the evening.

     

    Day/night Test cricket is one of several options under consideration. It is dependent on successfully developing a cricket ball that can be used in night conditions and this would need to be trialled at the domestic level first.
     

     
    While you maintain that the ODI format is fine, the fact is that the Champions Trophy will now be held once in four years and not every two years. The Twenty20 World Cup will take place every two years. Doesn‘t this indicate that to some extent the balance of power in terms of viewership and revenue is shifting from the ODI towards Twenty20?

    Don‘t forget that the ICC cricket World Cup is also held every four years and between this and the Champions Trophy, there will be a 50-over tournament every two years until 2015. In other words, the World Twenty20 will alternate with a 50-over format every year.

     

    Not surprisingly the 50-over format at international level remains very popular with players, spectators, TV viewers and sponsors. The highly successful ICC Champions Trophy event in South Africa demonstrated that yet again as have other recent bilateral series.
     
     

    ‘Our major events are televised into more than 200 countries with hundreds of millions of viewers. Cricket receives the second highest amount of TV viewers of any team sport after soccer‘
     

     
    Are you satisfied at the progress that has been made in terms of the preparations for the 2011 World Cup?

    Yes, we have done extremely well with preparations during the course of this year.

     
     
    How much revenue will the ICC and the boards make from cricket‘s showpiece event?

    In terms of commercial and broadcast interests, the World Cup 2011 is bundled with all the other major ICC events over an eight-year period. The current deal will run from 2007 to 2015 but the details, as you would appreciate, are confidential.

     

    We will, though, be investing $300 million into the development of the game in our associate and affiliate members over the course of this cycle.
     

    Do you see the IPL posing a threat to international cricket? Already last year Sri Lanka withdrew from their tour of England so that their players could take part in the IPL which offers much more money?

    On balance, the IPL has been very positive for the sport overall. It must be remembered that it is a domestic tournament under the auspices of the BCCI and does not take precedence over international cricket. This is something that the IPL itself and the BCCI has made clear to the players and public.
     

     
    Is the ICC examining the possibility of creating a window for the IPL?
    Being a domestic event, there is no consideration for a window at present and there is also no request for one.
     
     

    Australia, New Zealand and South Africa are also planning a league. Would this pose a challenge to the ICC in terms of formulating the FTP post 2012?

    I am not aware of such a league being planned. In any case, it would not impact the FTP post 2012 as this has already been agreed subject to a few provisos.
     

     
    India dominates the game economically in that 80 per cent of the revenue generated comes from here. Does the ICC have a gameplan to reduce this imbalance which cannot be healthy for any sport?

    We are always pleased when our members are able to generate funds and optimise their revenues domestically. On the other hand, we have always been fortunate to attract local and global sponsors that are not purely driven by the Indian market.

     

    However, given the huge market in India, it is not a surprise that this is the revenue generating powerhouse for world cricket. We will, therefore, continue to manage our economics on a global basis with India as a key market.

     

     
    Does more need to be done in terms of how the game is covered on television or are you satisfied?

    I think that the coverage the game receives worldwide is excellent. Our major events are televised into more than 200 countries with hundreds of millions of viewers. Cricket receives the second highest amount of TV viewers of any team sport after soccer.
     

     
    New media is growing through mobile and the Internet. How is the ICC taking advantage of this to spread the reach of the game?

    We have an excellent partnership with Yahoo! in relation to our website and other internet platforms. We also work with our commercial partners to make the most of the mobile platforms.

     
    The BCCI recently formed a consortium to fight piracy. Is this a serious threat from your point of view?

    ICC supported the BCCI in this regard and is also working seriously to handle this issue. We are working with our stakeholders to form a coalition to actively address and counteract online piracy.
     

    Could you shed light on the strategy that the ICC follows when it comes to doing local sponsorships for its events?

    The strategy we adopt depends on the event and the market in which it is taking place.
    In truth, it was not really difficult to get in sponsorships for this year. We managed to secure some excellent local sponsors despite the global recession and we were very pleased with the overall outcome. That is a reflection of the good health of the game and the value we are able to offer our commercial partners.

     

    For instance, we got Standard Bank to sponsor the World Twenty20 cricket championship. Local partners are an important feature of all ICC events because they tend to have a vested interest in the markets in which our events are staged. The ticketing component of the local partner packages offers an excellent platform for targeted sales promotions by sponsors.

     

    Our marketing research suggests that the dollar value of the televised brand exposure that local partners receive far exceeds their level of investment, primarily because our events are uncluttered in terms of the number of branding messages.
     

     
    What are the steps taken by the ICC to avoid ambush marketing?

    We implement sensible and practical measures during our events to ensure that orchestrated ambush marketing does not occur. I don‘t want to go into too much detail. But it is suffice to say that we are vigilant in our efforts to preserve our commercial partners‘ rights and make sure they receive value for their investment. 

     
    Is it easy to spread the reach of cricket to emerging and new markets?

    We invest more in developing the game than any other sport, apart from soccer. The Pepsi ICC Development Programme is spending around $300 million over the next cycle to develop and promote cricket below Full Member level.

    The Development Programme has made huge strides over recent years and we have seen teams like Ireland, Kenya, Scotland and the Netherlands come through that programme and put in competitive performances against the top sides. Ireland made it through to the Super Eight stage of Cricket World Cup 2007 and the World Twenty20 2009 beating a number of Full Members along the way. We recently saw the Netherlands beating England at Lord‘s in the World Twenty20. Participation has doubled over the last five years with the biggest growth areas being junior and female players.

     
     
    Finally, do China and the US play an important role in the ICC‘s growth plan?

    We have identified the US and China as two obvious areas for potential growth and, through our regional structures, we are involved in developing the game there. They are two very distinct and different markets for cricket and so cannot really be compared.

    However, there is no doubt that both offer a wonderful opportunity for cricket to continue to spread the sport and we intend to do just that.
     

  • ‘We will be the No. 1 distribution company this fiscal’ : Zee Turner chief executive officer Dinesh Jain

    ‘We will be the No. 1 distribution company this fiscal’ : Zee Turner chief executive officer Dinesh Jain

    Zee Turner Ltd, the joint venture distribution company between Zee and Turner, is eyeing a revenue of Rs 10 billion this fiscal on the back of a faster growth from DTH while pay-TV income from cable TV stays strong.

     

    In the earlier fiscal, Zee Turner had clocked Rs 7.5 billion after adding Ten Sports into the bouquet.

     

    Regionalisation will be a big growth driver for Zee Turner. With Zee Telugu and Zee Kannada turning around, the contribution from the southern region is also set to improve.

     

    Adding channels in the bouquet, which has a strong mix of general entertainment, movies and kids content, would form a part of Zee Turner‘s growth strategy. The plan is to have 50 channels within two years.

     

    In an interview with Indiantelevision.com‘s Sibabrata Das, Zee Turner Ltd. chief executive officer Dinesh Jain talks about the company‘s bouquet strength across 16 genres, the efforts to fill in the gaps and the next wave of pay-TV revenue growth in a digital environment.

     

    Excerpts:

     
     
    Zee Turner has set an ambitious revenue target of Rs 10 billion this fiscal. Has this growth momentum since the last fiscal been led by the addition of Ten Sports?

    Yes, Ten Sports has contributed but our organic growth has also been significant. I can‘t, though, comment on what our target is. But we expect to get a little under 20 per cent growth from cable TV while revenue from DTH will be at a faster pace. We, after all, have the widest bouquet with 35 channels.

     
     
    But isn’t the weight of the bouquet a weakness in today’s environment where cable TV networks have no bandwidth and charge hefty carriage fees?

    Providing such a wide choice is, in fact, our biggest strength. We have presence across 16 genres and have the maximum number of movie and regional language channels. In the Hindi general entertainment channel space, Zee TV is very powerful. And we have the strongest kids content in Cartoon Network and Pogo. We are a top-of-the-mind bouquet.

     

    Our plan, in fact, is to have 50 channels within the next two years. We may not release all the channels to all parts of the country. But they can be driver channels for the relevant market. We will increase the width and depth of our portfolio.
     

     
    But Zee Turner is still not the largest broadcasting distribution company in terms of revenue?

    Yes, our revenues are not in line with the strength of the bouquet. But we are the fastest growing company today. We will be the No. 1 distribution company this fiscal.
     

     
    Will the new wave of pay-TV revenue growth come from the regional markets?

    Regionalisation is a big thing for us. We have the largest bouquet of regional channels. We have, for instance, big drivers in Zee Marathi and Zee Bangla. News is also becoming regional and in local language. Zee has launched several regional news channels.

     

    We have set up task forces to cater to these regional portfolios. We are connecting the interiors for the regional packages and doing local trade marketing. We see big growth coming from our regional channels.
     

     
    Even in the South, which was a weak link, Zee Turner would be on a stronger wicket with the turnaround of Zee Telugu and Zee Kannada?

    The contribution from the South has increased as our Telugu (Zee Telugu) and Kannada (Zee Kannada) language channels started delivering. But we also had a strong base there due to our English content, led by HBO, Zee Studios and Zee Cafe. We have added WB, the English movie and entertainment channel, this year.

     

    We expect the pay-TV revenues from regional channels to look up, including the South. Zee Marathi, Zee Telugu and Zee Kannada will give us faster growth. We will also be taking our Zee News Uttar Pradesh and Zee Tamil (which will transition increasingly to a news channel) channels pay in the next 6-12 months. This will mean that all the 35 channels in our bouquet will be pay.

     

    Do you still miss the English news genre in the bouquet after CNBC TV18 moved out?

    We do not have channels in genres such as infotainment, travel, English general news and English business news. There are some regional languages where we are also absent. For completing our portfolio, we would be looking at filling such gaps.
     

     ‘Regionalisation is a big thing for us. We have the largest bouquet of regional channels. We have big drivers in Zee Marathi and Zee Bangla. Zee has also launched several regional news channels‘
     

     The government has recently come out with a Headend-In-The-Sky (HITS) policy. How do you see this impacting Zee Turner?

    HITS offers another great opportunity for digitisation and addressability. We expect the Telecom Regulatory Authority of India (Trai) to come out with a pricing policy for HITS. As long as the delivery platforms and addressability are similar, the pricing policy should be same.

     
     
    Do you strongly feel that Trai needs to lift the freeze on pricing?

    The freeze in pricing has led to anomalies. Different channels in the same genre are priced differently because they were launched in different dates. The price freeze will not, thus, impact the channels equally.

     

    A case in point is Zee Sports. If Zee Sports is to acquire a cricketing property paying as much as Star Cricket does, it will be at a disadvantage because of the price freeze. Launched later, Star Cricket is priced higher.

     

    Trai, in fact, is looking at revisiting the price freeze issue. Today there is enough competition in the market for channels not to start profiteering from high prices.

     
     Is Zee Sports turning out to be a liability as it is devoid of cricket after failing to bag the BCCI rights?

    No, but then there is definitely an opportunity loss. However, it is overcome by the strength of the bouquet.

     
     
    How is Zee Turner gearing up for the digital environment?

    We are building capabilities for the digital environment – be it IPTV, DTH, cable TV or 3G devices. India will have all models successful because it is such a huge market. We have created vertical heads separately for digital, analogue cable and commercial business 18 months back to bring more focus into these business segments.
     

     
    Do broadcasters see faster growth coming from DTH?

    Cable TV currently accounts for 70 per cent of the broadcasters’ pay-TV revenues. We see the industry settling at an equal ratio between analogue cable and digital platforms within two years.  

     

    Broadcasting distribution companies have entered into joint ventures like Zee Turner, MSM Discovery and Star Den. Is there scope for further consolidation?

    There are still many splinter groups such as Sahara and UTV. At some stage, they may decide to align. We are looking at such opportunities and alliances.
     

     
    Cable networks have been consolidating over the last few years. How do you see this impact broadcasting companies?

    The market is getting matured and organised. Though we are seeing the emergence of bigger MSOs (multi system operators), this will mean that the business is getting more rationalised. Bigger cable companies will look at improving bandwidth. There will be huge upsides – much like the coming together of organised retail helping FMCG companies.
     

    , Zee Studios and Zee Cafe. We have added WB, the English movie and entertainment channel, this year.

     

    We expect the pay-TV revenues from regional channels to look up, including the South. Zee Marathi, Zee Telugu and Zee Kannada will give us faster growth. We will also be taking our Zee News Uttar Pradesh and Zee Tamil (which will transition increasingly to a news channel) channels pay in the next 6-12 months. This will mean that all the 35 channels in our bouquet will be pay.

     

    Do you still miss the English news genre in the bouquet after CNBC TV18 moved out?
    We do not have channels in genres such as infotainment, travel, English general news and English business news. There are some regional languages where we are also absent. For completing our portfolio, we would be looking at filling such gaps.
  • ‘AXN prides itself on always being a challenger brand’ : Sony Pictures Entertainment senior VP, GM Ricky Ow

    ‘AXN prides itself on always being a challenger brand’ : Sony Pictures Entertainment senior VP, GM Ricky Ow

    These are challenging times for pan Asian broadcasters. The economic downturn has meant that ad revenue targets will not be easy to meet. And for the action-oriented broadcaster AXN, this is more so with its parent Japanese electronics major Sony scaling back as it posted its first loss in many years. Sony Pictures Entertainment (SPE), however, is looking at opportunities to snap up assets in the Asian region that would come at an attractive price.

     

    AXN, which launched in 1998 as an Asian channel, has grown in stature and moved to the matured markets, attracting male audiences. Localisation has also worked as a strategy.

     

    In an interview with Indiantelevision.com‘s Ashwin Pinto, Sony Pictures Entertainment (SPE) Networks Asia senior VP, GM Ricky Ow elaborates on the channel‘s brand positioning, growth, challenges and expansion plans.

     

    Excerpts:
     

     
    Parent company Sony is scaling back due to a downturn in the global economy. How is this affecting SPE Networks Asia in terms of investing more in content and channels?
    SPE Networks – Asia will continue to invest in content and channels because opportunities are presenting themselves in Asia. Especially during such tough economic times, people realise the need for television as an affordable form of entertainment. With the wave of TV digitisation starting to sweep through the region, there will be opportunities for us to grab some real assets in the new digital world.
     

     
    What are the challenges that pan Asian broadcasters like AXN face in these tough times?
    Firstly, there remains substantial revenue leakage through piracy. Secondly, competition continues to increase with more channels and choices entering the market. As audiences become increasingly fragmented with growing competition for their attention, business plans have to remain relevant.

     

    In addition, new media offers opportunities for the brand to go beyond television – for content to be consumed anytime, anywhere, in many forms. At this time, however, all players in the industry are still in the race to find the perfect business model that will work for new media platforms.
     

     
    Another challenge is that the English GEC genre is perceived to be used as a ‘snack‘ by viewers. How do you go beyond that and try to build stickiness?
    It is a misconception that AXN offers ‘snack TV‘. Many of our shows are of an hour‘s length per episode and others are even two hours long. AXN programmes offer a destination to escape to. One of the reasons why we have remained as the dominant player in this genre is that we offer something different and viewers actually watch and follow, not just surf through our content.
     

     
    When Sony launched AXN in India way back in 1998, it was to be an action and adventure channel for male audiences. To what extent have the objectives been achieved?
    When Sony launched AXN in India back in 1998, it was the first action and adventure channel. We had set out to be the first to create such a genre, and to be the best. I think we have succeeded as we continue to offer the best today, even in the face of rising competition from channels trying to replicate AXN‘s successful model.

     

    We also wanted to offer high quality English entertainment to audiences in India as well as the rest of Asia that is growing in sophistication and affluence. We felt that a channel with unique content of distinguished quality will not only excite the top end of the market, but also markets that are as a whole more mature, with viewers that are sophisticated and well-travelled. I believe that these goals have also been achieved today.

     
     
    How has AXN evolved as a brand over the years?
    AXN began as a high-end proposition. It was one that targetted affluent adults as well as children from affluent households. Since then, action and adventure as a genre has in many ways extended itself to mass markets because it is a universal language. With the viewership numbers that the action and adventure genre is delivering today, AXN is definitely not a niche channel, but a unique content destination with far wider appeal than we originally thought.

     
     ‘Investments of the earlier days into on-ground events, then into original programming, and more recently into the Action Awards, have all worked out well for AXN‘
     

     
    What were the challenges AXN faced in establishing the brand?
    AXN was blessed to have started out when competition was not that great in the market. A brand is made up of a brand promise and product fulfilment to the consumer. For AXN, our brand promises and product fulfilment have always been very closely aligned since its early days. In a lot of cases AXN over-delivered on brand promises, and that has had a long term positive impact as the channel has won over audiences‘ loyalty and affection.

     

    The best evidence of that was seen during the ban on AXN in India some years back. Viewers missed AXN and wanted the channel back on TV. This was strong testimony that AXN has indeed done well as a brand.

     

    Investments of the earlier days into on-ground events, then into original programming, and more recently into the Action Awards, have all worked out well for what AXN stands for.
     

     
    AXN started as an Asian channel and then moved elsewhere. How far has it succeeded in this?
    AXN was born in Asia and was then marketed around the world. This shows that quality channels need not always be created in the West or elsewhere and then parachuted into Asia. Sony had the belief and confidence we could launch a channel first in Asia, and then bring it around the world.

     

    We have created original content like AXN Asia‘s The Amazing Race Asia. The reality race has been one of the most difficult to produce, and yet we have done well at it. In doing so, we have achieved our goal of creating original Asian productions which are good enough to be watched around the world.

     

    AXN Asia‘s sister channel Animax, Asia‘s anime and youth entertainment channel, has also made breakthroughs. In 2009, Animax offered content in shortened broadcast windows, via simulcast deals with Japanese studios and broadcasters. Shows like InuYasha – The Final Act and Fullmetal Alchemist Brotherhood have been broadcast within the same week as the Japanese broadcast, and Tears to Tiara in a same-time-as-Japan simulcast. This has been a big step to ensure fans and viewers catch the shows on the channel and nowhere else.

     

    AXN and Animax were among the first channels in the region to provide mobile offerings. Animax Mobile 3G streaming service was launched about two years ago, while AXN also had mobile-based content for its top shows. A highlight of AXN‘s mobile venture include exclusive video footage which was unavailable on TV, for The Amazing Race Asia in ‘The Host‘s Diary‘ where show host Allan Wu shared his thoughts and added to the entire show viewing experience for AXN viewers.

     
     
    And on the marketing front?
    On the marketing front, AXN prides itself on always being a challenger brand. We continue to view AXN as a challenger and are prepared to pursue innovative and creative marketing strategies to grab attention, but without offending the cultures, sensitivities and sensibilities of each market.

     

    The ads that we have created over the years have always been outstanding, and can capture viewers‘ attention and excitement of the channel, but never offensive. We have been consistently doing so and AXN is one of the few TV networks in Asia that have pursued such aggressive marketing strategies.

     
     
    In 2002-2003 AXN made a deliberate shift away from movies and focussed more on top line shows like Alias, 24. What factors prompted the move and how did this help in terms of ratings?
    In 2002, AXN shifted in focus away from movies, but the channel continued to offer regular movie slots. The shift in focus was to ensure AXN had a richer variety in the programming mix that still offers action and adventure to our viewers.

     

    Back then, drama series such as 24 and Alias were not as well watched as movies, but seeing that the quality of production in such series were as good as some movies, we were confident viewers would take to the new drama series on AXN.

     

    Indeed, movies widen the overall reach of channels. However, our reduction in movies has not affected AXN‘s reach in this case; movies continued to be part of the programming mix. The increase in drama series offerings enhanced AXN‘s connection with viewers at the top end of the market. This is difficult to measure by ratings, but there are considerable viewers that AXN reaches out to. They are opinion leaders and trend-setters, and they demand such content.

     

    AXN‘s ability to successfully market such drama series has also contributed to greater viewer ‘stickiness‘ to the channel. While a movie is a one-off show, drama series average 13-15 episodes per season, and that has worked to keep audiences coming back to AXN.

     
     
    How big a role have local shows played?
    We started off with local events and progressed to producing local shows, both of which added to the overall AXN experience. In recent years, AXN has focussed on regional or international shows that India is a part of. While such regional shows are not dedicated to India alone, these offer a totally different experience to Indian audiences. We will continue to produce more of such regional shows that will include India and the rest of Asia.

     

    Local events, local shows and regional shows with local elements have all brought different types of experiences and enjoyment to Indian audiences. With India becoming an increasingly important market for everyone including SPE Networks – Asia, we expect to offer more of the three different initiatives – local events, local shows and regional shows – in time to come to provide even more connectors with AXN.
     

     
    Is the localisation strategy the same across Asia?
    Localisation strategies are very similar across Asia, but with some markets having more localised shows and others able to participate in the regional shows that AXN creates. In that regard, we have been able to rope all markets in, and offer the same AXN touch and feel across the region.

     

    The economic downturn has helped SPE Networks – Asia as a whole to refine our plans. It has helped us re-set our priorities, re-evaluate our templates of success, and rethink if we can do things better. The economic downturn has definitely impacted us and everyone else, but we believe we can derive a positive outcome from it by re-examining what we assumed had worked in the past, and come up with new strategies to move forward. 

     

     
    How has AXN fine-tuned its localisation strategy this year?
    We have invested in local productions such as the AXN Action Awards, and will be looking at opportunities that can bring a very different touch in original productions that are relevant to India.

    In addition, we have introduced English subtitling in India to enable viewers who may not be used to some of the accents to still enjoy the shows on AXN.
     

     
    What is the programming focus this year?
    AXN has embarked on three major changes in 2009. Firstly, we have made aggressive efforts to introduce magic-reality programming in a big way, in India. We have brought two of the biggest magicians in the world – Criss Angel and David Blaine – to AXN viewers. These two are now household names not just in the U.S., but in Asia too. Coming up, AXN will be introducing another world-class magician in our brand new original production, called Cyril: Simply Magic.

     

    All three have been some of the most sought-after street magicians. With Cyril, his exposure in India has been limited so far, but with the upcoming production, viewers can see for themselves his brand of magic.

     

    In addition to the three magicians, we also premiered Breaking the Magician‘s Code. Unveiling the secrets behind the illusions and tricks, the show is able to really bring in both the high-end viewers as well as a wider audience base. I have high hopes that the series will do very well in India.

     

    A second new initiative that AXN has embarked on is the expansion of AXN‘s reality block to three-hours. The key difference here is that a large number of channels are now offering reality programming that have been successful on AXN, but audiences still recognize that we brought them the original, and continue to do so, and hence viewers are still watching AXN. Anchoring this block are good shows such as So You Think You Can Dance? and the latest reality game show WipeOut, which is produced by the same team that brought on Fear Factor.

     

    Thirdly, we have also increased our movie slots over the weekends to offer a wider appeal to audiences and broaden the viewership base. 

     
    To what extent have programming costs risen over the past couple of years with attempts to bring in the latest shows and seasons?
    AXN has always been bringing first-run and latest seasons of shows to offer the newest and best programming from the US, Europe and around the world on our channel. This is not new as it is one of the key reasons why viewers continue to tune-in to AXN.

     

    Indeed, the cost of programming has gone up over the years. But since this has been what we have been doing all along, the increased cost continues to be within our expectations. 

     
    Is new media going to play an important role for AXN in the coming two years like what it does in countries like Korea?
    There is no doubt that new media will play an important role in the future. The Internet has already proven its importance with governments having won elections using the medium cleverly. The growth of mobile usage, with ubiquitous ownership of mobile phones and lines among the masses, make the mobile platform very attractive to marketers. However, we, like everyone else, are still figuring out the business model for new media platforms at this point in time.

     

    New media adoption however, differs from market to market. Infrastructure, strategies, timelines, and market forces determine the rate of new media adoption in individual markets. Korea and Japan are leading at this point in time as early adopters of new media, while smaller markets like Singapore and Hong Kong are also ahead as these are smaller markets that offer ease of policy implementation and infrastructure establishment.

     

    We believe that there will be a lot more experimentation with new media in the next few years as the world races to find solutions to tap into new media platforms. As for India, it continues to be a volume game due to the size of the market. We are optimistic that with the right pricing, consumers will be persuaded to use new media, and because of the size of the market, the returns can still be very attractive for firms. We believe that once the necessary infrastructure is in place, there could be an explosion in new media take-up in India. 

     
    In the US, CBS opened an upscale restaurant where fans can experience the brand. Would this concept work in India and Asia?
    We certainly believe such a concept can work in India and Asia. In fact, we have been previously approached to set up AXN Cafés and Animax Cafés in the region.

     

    We believe that with the right partners who have the necessary expertise, coupled with the right level of commitment they put behind our brands, such a business opportunity will prove an interesting proposition. We have had some discussions so far, but we believe we have yet to find the right partners at this point in time. 
  • CN, Pogo lay out festive goodies for kids

    CN, Pogo lay out festive goodies for kids

    MUMBAI: With the onset of the festive season, Turner‘s kids entertainment channels Cartoon Network and Pogo have lined up special programming blocks for their young viewers.

    Starting 14 October, Cartoon Network will present a special block called ‘Maximum Pataka‘ showcasing Indian animation-movies such as Prahlad, Bal Ganesha, Dashavatar, Eklavya – The Invincible and Ghatotkach.

    Meanwhile, Pogo will launch the themed franchises – Lights Camera Pogo! Di Wah Wah Li and Lights Camera Pogo! Chhoti Diwali & Badi Diwali.

    While under the former block, the channel will feature movies such as Return of Hanuman, Immortal Hanuman and Hanuman, the latter will include movies like Balkhand, Ravan: The Demon King, Ramayana: The Legend of Prince Rama and Ravan Mahayodhya.

    The season will also see the network launch new shows to up its viewership rate.

    Says Turner International India director – programming South Asia Krishna Desai, “Festive months are high viewership months and we always schedule and launch some of our best programming during these time-periods. Thus, Cartoon Network will see new shows such as Jhakaas Zorori and the animated adventures series Batman: The Brave and The Bold.”

    Jhakaas Zorori, showcasing the adventures of a scheming fox named Zorori, will premiere on 19 October and air Monday-Thursday. Batman: The Brave and The Bold will roll out on 24 October and will be telecast every Saturday at 11:30 am.

    Adds Desai , “Pogo will present the brand new season 7 of the critically acclaimed show M.A.D, starting 11 October, on Sundays at 9 am. Additionally, it will host the world premiere of the animation series – The Adventures Of Hanuman – on 25 October, Sundays at 10 am.”
     

    To further heighten the festive spirit, Cartoon Network will be hosting a special Diwali contest called ‘Cartoon Network Popcorn Maximum Pataka.‘ As part of the contest, crackers will appear as bugs on TV screens during the movies aired under the Diwali special block ‘Maximum Pataka.‘ Each bug will have a unique code attached to it, every time it appears.

    Elaborates Desai, “Kids will have to call or SMS the code when they see it which will keep adding points to their numbers. Prizes will be given out on a daily basis as well as at the end of the contest. The kid who scores the maximum for all five movies will stand a chance to win the grand prize.”

    Post this, extending the festive celebrations, Pogo will organise a fun contest to promote its popular movie franchise ‘Lights Camera Pogo‘ in December.

  • ‘Our top three international markets are the UK, Australia and India’ : Dixie Carter – TNA Entertainment president

    ‘Our top three international markets are the UK, Australia and India’ : Dixie Carter – TNA Entertainment president

    In 2002, TNA Entertainment found a gap in the marketplace to compete with WWE. TNA Wrestling was born and is now seen in 120 countries globally.

    TNA has carved out a separate positioning for itself. While WWE is entertainment, TNA is professional wrestling.

    Spending the first five years of its existence on establishing the brand in the US, the focus has been to expand TNA‘s global reach. And India is TNA‘s one of the top three markets outside the US.

    In order to complement its roster of events, ESPN Star Sports (ESS) signed a deal with TNA Wrestling a few years back to broadcast their programming. The sports broadcaster renewed its deal for TNA content last year.

    In an interview with Indiantelevision.com‘s Ashwin Pinto, TNA Entertainment president Dixie Carter elaborates on the company‘s plans to up its game in India.

    Excerpts:

    When TNA Wrestling started out in 2002, what were the key goals?
    In the late 1990s, World Championship Wrestling (WCW) and World Wrestling Federation (WWF) combined for approximate gross revenues of $800-$900 million per year. By the time TNA started in 2002, WWF had the only major international professional wrestling company in the world.

    So there was not only room, but a need for competition in the marketplace. Thus, our goal was to establish TNA as a premiere professional wrestling company worldwide.

    To what extent have these goals been accomplished?
    TNA just celebrated its seventh anniversary and we are now seen in more than 120 countries globally. For the last four years, we have had a tremendous relationship with our US cable TV partner Spike TV and we just signed a new three-year deal with them.

    During the second quarter of this year, more than 1.8 million viewers on an average tuned in to TNA: iMPACT! on Spike TV each week. Overall, TNA: iMPACT! saw a 31 per cent overall growth with double digit increases in the key demographics of M18-49 (+33 per cent) and P18-49 (+40 per cent). TNA now routinely exceeds those ratings of WWE‘s ECW brand and we are closing the gap with their Smackdown brand.

    Additionally, we have grown our international business exponentially in the last two years. By developing relationships with broadcasters in the UK, Australia and with ESPN Star Sports (ESS), TNA has become a global entity.

    We have also assembled a talent roster that can compete with any promotion out there. As far as challenges are concerned, I think that adequate capitalisation is the biggest challenge for any start up. We have had to be smart with our resources and prioritise them. The other main challenge was to convince people that we were going to be around for the long-term, and I think we‘ve done that.

    At the time of launch on one hand you had the success of the WWE. On the other hand, you had the failure of Turner‘s WCW. What were the learnings from this?
    We learned that the fan base will support two professional wrestling companies. Obviously, it is a sobering lesson when a company that generated the revenue and had the success that WCW had, could and would go out of business just a couple of years later. You have to learn from those mistakes made.

    How is TNA positioned vis-a-vis the WWE?
    A couple of years ago, I read a transcript of a Vince McMahon (WWE chairman) interview where he said that WWE is entertainment and TNA is professional wrestling, and I couldn‘t agree more. We want to emphasise our athletes and their athletic ability, and we don‘t run from what we are.

    Could you talk about the strategy TNA is following to grow its reach globally?
    TNA spent the first five years of its existence focussing on establishing the brand in the US. Once we felt that that we were on firm footing, we began to expand our reach. I think that the United Kingdom is a good case study for what we are trying to accomplish globally.

    First, we established a successful relationship with a top TV partner, and then built the brand through promotional appearances and then eventually live events and consumer products.
    ‘TNA needs to provide ESS with more content such as TNA Epics and regularly scheduled promotional appearances with TNA superstars in India‘

    How much of a challenge is it to grow fan loyalty for the brand given the competition from the WWE and an increasingly fragmented media environment?
    In four years, we have doubled our average audience on Spike TV in the US and are beating our competitors programming in key countries worldwide. By that alone, we are the fastest growing wrestling company in the world.

    WWE is the gold standard in the professional wrestling business, but a lot of people have stopped watching wrestling. And as the upstart company, we have the opportunity to offer something different.

    In how many homes is TNA seen globally and what new television deals were signed recently?
    TNA is seen in over 120 countries around the world with many millions of viewers tuning in each week. We recently signed new deals with Foxtel in Australia, Canal 9 in Denmark and W9 in France.

    Where does India fit in the scheme of things for TNA?
    India offers a tremendous opportunity for TNA. From a consumer index standpoint, if India continues its recent financial growth it will become the fifth largest consumer economy by 2025 and we want to be a part of that.

    Aside from television licensing revenues, we have to activate our strategy for live events and other commercial opportunities.

    What are the different shows that TNA offers and has this been increased over the past year?
    TNA‘s flagship show is the weekly two hour series TNA iMPACT! In addition, we produce 12 monthly three hour pay-per-views per year. TNA Xplosion is a one-hour edited version of iMPACT! airing outside the United States with some exclusive content added. We also recently launched a one-hour show in a ‘best of‘ format called TNA Epics. This show highlights the best matches, moments and superstars in TNA history.

    In the ratings sweepstakes TNA is behind the WWE in India. What is the game plan to close this gap?
    TNA needs to provide ESS with more content such as TNA Epics and regularly scheduled promotional appearances with TNA superstars in India. We currently are on a one week delay in terms of the content broadcasted in India versus the United States.

    We hope to close that gap and have our programmes airing within the same week. And obviously, planning live events in India is a major piece of our strategy.

    We are planning a promotional tour in India in conjunction with ESS. TNA superstars haven‘t visited since 2005, so we are long overdue to return. We are also creating customised station IDs and bumper breaks.

    In terms of revenues what growth do you see this year? How much of it comes from outside the US?
    We are looking for a 10 per cent growth this year. This year, approximately 15 per cent of our revenue will come from international markets. Our top three markets are the UK, Australia and India.

    Is new media playing a more important role in TNA‘s brand building strategy?
    TNA was an early adopter of YouTube, and subsequently we are now one of their most all-time viewed channels with close to 200 million views. We continue to strive to stay on the cutting edge of new media and social networking technologies such as Twitter, Facebook, MySpace and whatever forms of communication can best help TNA reach out to its fans.

    We also reward our die-hard fans with opportunities available exclusively online and not to the general public. For instance, if you follow TNA on Twitter, at live events we hide a backstage pass in the venue and then reveal its location exclusively on our Twitter account. The fan who finds it gets to go backstage during the show.

    What plans does TNA have in the licensing and merchandising space?
    We have learned to be patient and selective in choosing our licensing partners. Aligning with great companies is what will create successful licensing programmes, create great products for our fans and bring TNA the most revenue.

    Jakks Pacific is our new worldwide master toy licensee and we will launch our first action figures and play sets together starting in summer 2010. We are very excited about adding this to our licensing and merchandising mix. TNA has been out of the toy category for two years and our fans have been asking for these products. For this reason, we expect great success when we launch our toys next year.

    We released our first video game in September 2008 with Midway Games which to-date has sold close to 1.5 million units. We are currently evaluating our options for our next video game partner due to the Warner acquisition of Midway and expect to make an announcement soon.

    For our trading cards and sports memorabilia our partner is Tristar. In particular our trading cards have been a great success. We‘ve just launched our third series to retail this month.

    Internally, we create our own merchandise across several categories and sell it directly to our fans at live events and via shoptna.com. We specifically focus on designing and creating our own apparel. We also handle the creation of our replica belts, and specialty collectible merchandise like the Sting bats, Superstar programs and collectible TNA books.
    TNA has stars like Kevin Nash, Jeff Jarett who have wrestled for years in other organisations. Does this familiarity make it easier for fans to connect with the TNA brand?
    TNA tries to strike a balance between recognisable names from other companies and our own homegrown talent. We‘ve found that the combination of both seasoned veterans and the next great superstars of tomorrow elevates our entire brand.
     

    Have fans‘ attitudes towards sports entertainment changed over this decade as per research?
    There is an old saying — “for those who believe, no explanation is necessary; and for those who don‘t believe, no explanation is possible.” The mission for TNA in 2009 and beyond is to attract more people who believe that professional wrestling is a great form of entertainment, and that TNA is their preferred brand of professional wrestling.

    When WCW closed down, there was worry that wrestlers and fans would not have an alternative apart from the WWE. To what extent has TNA managed to emerge as a healthy option?
    After seven years we have emerged as the only healthy option for both talent and fans alike. Since TNA started, several people have tried and failed to develop an alternative or competition to WWE and TNA.

    One challenge is to cultivate new talent. What is TNA‘s strategy in this regard?
    Since we don‘t currently have a developmental territory, we have to keep a close eye on the best unsigned talent around the world.

    Recently, we signed Ayako Hamada from Japan and Sarah Stock from Mexico, both female talents who are going to do great things for our Knockouts division. We are actively looking for Indian talent as well.

    Hamada from Japan and Sarah Stock from Mexico, both female talents who are going to do great things for our Knockouts division. We are actively looking for Indian talent as well.

    When WCW closed down, there was worry that wrestlers and fans would not have an alternative apart from the WWE. To what extent has TNA managed to emerge as a healthy option?
    After seven years we have emerged as the only healthy option for both talent and fans alike. Since TNA started, several people have tried and failed to develop an alternative or competition to WWE and TNA.

    One challenge is to cultivate new talent. What is TNA‘s strategy in this regard?
    Since we don‘t currently have a developmental territory, we have to keep a close eye on the best unsigned talent around the world.

    Recently, we signed Ayako Hamada from Japan and Sarah Stock from Mexico, both female talents who are going to do great things for our Knockouts division. We are actively looking for Indian talent as well.

  • ‘The kids market remains hugely under indexed’ : Nina Elavia Jaipuria – Nick India VP and GM

    ‘The kids market remains hugely under indexed’ : Nina Elavia Jaipuria – Nick India VP and GM

    It has been a phenomenal journey for Nick in India. From being a channel that was residing at the bottom of the heap, the nine-year-old player has finally emerged as the leader on top in the Hindi speaking market, edging out long-standing market leader Cartoon Network.

     

    And now, having captured the HSM space, the channel is readying to spread its wings across the southern-language market by 2009-end. The next in step is to challenge Cartoon Network which rules the all-India market.

     

    Nick has also made its foray into local content for the Indian market with Little Krishna, acquiring the show’s TV rights for two years for the South Asian territory.

     

    In an interview with Indiantelevision.com’s Anindita Sarkar, Nick India SVP and GM Nina Elavia Jaipuria reveals the strategies that have worked for the channel and how she plans to grow in a fiercely competitive marketplace.

     

    Excerpts:

    Nick has emerged as the number one kids channel in the Hindi speaking market. What contributed most towards this growth?
    There are a couple of differentiators and unique activities that the channel has done very consistently over a period of time. The biggest differentiator for the channel has been Nicktoons – characters that have helped Nick establish space and engagement with the kids leading to an increase in the stickiness of the channel.

     

    Secondly, we have managed to take Nick beyond television, thus making it more tangible. And I think we did that very successfully with our experimental 360 degree marketing philosophy – we wanted to be in every place where children are. So we were there promoting ourselves right from schools, cinema houses, malls, cable television to comic books, van activation and general entertainment channels.

     

    We also increased our consumer products activities – be it in the form of storyboards, storybooks, activity books, toys with Mattel, clothes with Weekender, linen with Portico, etc. And now that schools are opening, we will be soon coming out with stationary and back-to-school items.

     

    We also intensified our engagement and connection with children through constant promotions, polls, votes, contests and festivals including father’s day, mother’s day, Raksha Bandhan, Holi and so on. We celebrated every festival that was important to kids.

    Why did you choose GECs as a promotional platform?
    In a one-television household, it is but natural that kids are watching Hindi GECs along with their families. So, we know that today’s kids watch a Balika Vadhu or a Star Plus or Zee TV for that matter. So we decided on this medium as we would be able to capture the entire gambit of captive audience.

    But don’t you think that GECs today have actually emerged as contenders to the kids channels?
    If you see, even with the emergence of so many GECs, the kids’ category remained almost unaffected. This is because eventually kids come back to watch what is tailormade for them. And, no matter how hard a GEC tries, it cannot attract any child’s absolute attention. He/she at most will continue to remain only a passive viewer. GECs cater to the family as a whole and their content is not custom-made for kids unlike a kid’s category which targets only the kids.

    With Little Krishna you finally forayed into local animation. What took you so long to take this decision?
    Well, we had been looking for something that was built on a very strong narrative so that it carried not one single hint of boredom. This is because a kid’s attention span is very limited and you have to engage them within the first ten seconds. So, our hunt went real long. And then, finally we came up with Little Krishna, in both English and Hindi, which not only has a very compelling narrative, but is also supported by seven years of extensive authentic research (without any distortion) conducted by Iscon. The show has captured Krishna in various facets and every episode is a standalone. So, you don’t have to know what has happened before or after. Also, the script is extremely strong and tight and with the quality of animation that it has, the show is sure to make it to the overseas market.

    What was the need for localisation?
    Well, there was not really a need for localisation because as a broadcaster I want content that entertains children and also gets rid of two things – boredom and stress. Yes, I do agree that some amount of local character would surely add some local flavour. But in content, that is not at all a necessity to have. Its more about the localisation of the channel which comes with how you dub, the language you speak, and the promos that the channel lines up.
    ‘Even though the kids segment contributes 7 per cent to the total television viewership, our revenue share is less than 2 per cent‘

    How has the co-viewing pattern helped the channel to grow?
    Today as a channel, we have the gatekeeper’s (parents) trust. We do not carry any form of content that could be harmful to the kids. We are responsible broadcasters and because of this parents allow their kids to watch our channel. In order to spend time with their kids, they also end up spending a lot of time on the channel. Also, animation as a category is today appealing to adults. Thus, a lot of co-viewing is taking place.

    Are advertisers taking advantage of this trend?
    Definitely! In fact, in the last one year, we have more than quadrupled our sales revenue as advertisers have found value in what Nick has to offer. We have done a lot of value addition and brand integration with all the categories that have come on board through sampling and on-ground activations. As a result, from 17 brands that we began with, we have now extended to over 75-80.

    Are brands confined to the kids’ category alone or is the base expanding?
    Absolutely! Two years ago, our reach was 13 per cent and today it is 32 per cent. With a lot of co-viewing happening, advertisers today understand that kids’ channels are also an effective medium to reach out to their target buyers. Also, the mere pressure of pester power that kids have on their parents decisions have pulled a lot of FMCG, insurance and telecom brands on board.

    With recession hitting hard, what kind of impact did it have on your advertising revenues?
    Look, television is the cheapest medium to reach out to the masses. For every other medium, there is an extra amount to be paid. Manufacturers understand this and they have also recognised our growth. And, thus, even during recession we have doubled our rates. Nick has performed all through and I did not want to succumb to this economic slowdown. Yes, instead of annual deals a lot of quarter deals were being cracked, but this could always be reviewed. As a broadcaster Nick did well and we surely deserved the revenues we generated.

    How has the backing from Viacom and Network18 helped in Nick’s growth in India?
    The network has been an absolute might. If you go through our tent pole projects in the last quarter, you will see that a lot of awareness and sampling has been created through Colors, IBN7, CNBC Awaaz and MTV amongst family and children outside of the kids’ category. All of them are passive viewers and, therefore, the network has only helped us promote ourselves.

    How well are you distributed across the country?
    We have got approximately 70-75 per cent all band connectivity wherein we are available in almost 26 million households. We are very well distributed all over the country in various town sizes. While 30 per cent of our ratings come in from metros, 35-40 per cent of the contribution comes in from the 1 million-plus cities and the remaining balance is attracted from the 1-10 million.

    So what are your plans going ahead?
    Well, until now our focus was to get a foothold in the Hindi speaking market. And now that we have done it, our first plan is surely to continue our growth and sustain our leadership position in this space. Our next plan now is to look South, which is certain to happen by the end of this year. We will head for all the southern markets – Tamil Nadu, Kerala, Karnataka and Andhra Pradesh. We will cater to them with the same content. We will initially begin with English and then move on to the regional languages with dubbed content as we get a foothold.

     

    However, the major challenge there is going to be distribution because unlike the HSM market, we are not distributed there at all.
    Is there any change in the ratio between advertising and subscription revenues?
    Advertising still remains the predominant one, contributing over 60 per cent to our revenues. Distribution, meanwhile, is a constant revenue stream that you get year after year, but it’s the biggest payout as well. We have also taken baby steps in consumer products. When we started off with 2-3 products in the consumer product business, it was only a marketing tool. But now I think its time that it will start paying off. We are already available across 17 categories and will soon be launching in stationary, plush and home DVD with Excel. This year, therefore, we will see revenues flowing in from this stream as well.

    Why do you think that even after witnessing a growth in viewership, the kids category has not grown in terms of revenue share?
    The kids market remains hugely under indexed. Even though the kids segment contributes 7 per cent to the total television viewership, our revenue share is less than 2 per cent. This is because of the baggage that the space has been carrying over the years where advertisers are used to paying to the GECs.

     

    But with a lot of co-viewing happening now along with integrated value addition to brands and the pester power of kids, I think we are ready to shed that baggage.
    How has the interactive media contributed towards Nick’s growth?
    Our website has about 10 per cent penetration with kids today – and this is growing. But I have to say that at the end of the day, everything feeds into one another. Therefore, it’s very essential for us to go multiplatform.