Tag: Zee Entertainment.

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

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

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

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

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

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

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

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

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

    Excerpts:

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

  • New media to open up new revenue streams: Punit Goenka

    New media to open up new revenue streams: Punit Goenka

    MUMBAI: Entertainment in today’s times cannot be termed as evolution anymore, it is a ‘revolution’, Zee Entertainment Enterprises MD and CEO Punit Goenka said on Wednesday while delivering a keynote address at Ficci Frames 2012.

    According to Goenka, there are two main factors that are driving the revolution — young population with high disposable income; and a new generation that is ready to embrace new technology at the drop of a hat.

    Emphasising on the fact that new media would create unique revenue generation models for the entire value chain, he said that with the spread of adoption of content consumption, very soon new media will not be new media. It will be “The media”.

    Goenka said content consumption is going through a sea change. Broadcasters are increasingly looking to engage young audiences through new media offerings. “With dependence on ad revenues going down, newer avenues will open up for content players. Niche and sports channels, currently unprofitable ventures, will start becoming viable businesses. 3G, 4G and Wireless Broadband will evolve as new platforms for distribution of content. Also, smart devices will drive consumption of content on-the-go.

    Goenka also said that the ratings system in India is inadequate. It needs to be enhanced to give the right picture of TV viewing.

    He said that GenNext is redefining the TV broadcast industry and to move forward content creators, content delivery platforms and broadcasters have to work in sync to meet their expectations.

    “India’s young population is demonstrating huge appetite for digital content. Broadcasters and content providers need to ride on the tech wave to seize the opportunity. Technology is re-defining industries and consumer consumption. Broadcasters and content houses are working towards building anytime, anywhere access to content. Content producers are looking at partnerships with platform owners. Distribution players need to evolve into an intelligent pipe,” he added.

    Niche is the way forward in the television space. “It is imperative to have fair price for the content available. Content has to scale up to command fair share of consumer’s wallet. Premium pricing should be demanded for exclusive content and consumers are willing to pay for such content.”

    Talking about digitisation, Goenka said, “Consolidation and co-option will drive digitisation. Less than 20 per cent channels are profitable on standalone basis. With the implementation of DAS, as per the announced timelines, there would be accelerated conversion from analogue to digital subscribers. I believe that over the next 4-5 years, the television distribution business can evolve to a more transparent, organised and service oriented industry.”

    “Young Indian with an average age of 29 constitutes a majority of wealth accumulators. They will decide which way the entertainment content and delivery mechanism moves over the next few years. At least 2.2 million jobs will be created over the next two years, resulting in the changing lifestyle of India‘s younger generation. Over the next 10 years, GenNext should constitute the majority of ‘wealth accumulators’,” he added.

    As smart phones gain in popularity and acceptance, emerging youth markets such as China and India offer a bigger opportunity in terms of market size and potential. “India will leapfrog the United States and Europe’s combined markets to become the second largest youth smart phone market with 66 million owners,” he added.

  • Leading broadcasters to gain as advertisers rejig spends: Vaz

    Leading broadcasters to gain as advertisers rejig spends: Vaz

    MUMBAI: Leading broadcasters will continue to post strong ad revenue growth while the long tail will be severely hurt as advertisers tend to consolidate their spends in a cautionary environment, said Star India president ad sales Kevin Vaz in an interview with Indiantelevision.com.


    The television sector will see a 13-15 per cent growth in ad revenue this fiscal while print will be pushed back in a slowing economy.


    “The ad market is not as buoyant as it was in January. We will not see a 20-25 per cent growth as was forecasted earlier. But the leaders in any genre will benefit as advertising monies get rejigged. The long tail will not find support from advertisers,” said Vaz.


    Star India, which has leader channels in most genres, has done more annual and network deals this year. “Our top 10 clients, for instance, have done deals stretching from a minimum of 12 months to 36 months. We will beat the trend and grow much faster than the industry. Being in leadership position has helped stitch long term deals,” averred Vaz.



    In an earlier interview, Zee Entertainment Enterprises Ltd executive director revenue and niche channels Joy Chakraborthy had stated that advertisers were looking at shorter term and quarterly deals.


    The Hindi general entertainment channel (GEC) genre, pegged at Rs 37-40 billion, will grow at 12-15 per cent this year. “Cricket is hit in a big way. GECs are on an upswing even as ad monies are moving away from cricket,” stated Vaz.


    The Hindi movie channel genre is set to grow at 15-20 per cent. “Star Gold will capitalise heavily as the channel is performing very well. We have cut the ad inventory time by 33 per cent to give it a Hindi GEC environment and ramped up our investment on movie acquisitions,” said Vaz.


    The news genre will continue to struggle this year. “With the resurgence of GECs, the news genre has stagnated for the last few years,” Vaz said.

  • Zing dons new look for Lux

    Zing dons new look for Lux

    MUMBAI: Taking the concept of roadblock advertising one step ahead, Zing, the Bollywood channel from the Zee Entertainment Enterprises Ltd (Zeel) stable, has worked out an innovative brand integration with one of its key advertisers for a duration of three weeks.

    Zing has integrated the popular toiletries brand Lux in its channel identity, logo, menu cards and its morning songs programme, Chillax Mornings.

    Zing is doing this roadblock for Lux Lotus and Cream, a new soap from the toiletries manufacturer, till Diwali.

    Zing has redone its colour scheme from a red and white combination to the purple and cream one that Lux is using for this new soap. All the peripherals of the channel packaging reflect the same.

  • GEC 2009: Changing trends and confused leadership

    GEC 2009: Changing trends and confused leadership

    Year 2009 shall be a year to recall…if not for all, at least for the Hindi general entertainment channels!!!

    Even through the recession fever, and the debacle of three channels, the Hindi GEC genre has roared to an eleven per cent growth over the previous year. According to Tam data for Hindi speaking market (HSM), the share of Hindi GEC, which stood at 34.59 per cent in 2008, has moved up to 38.39 per cent in 2009.

    Despite a strong cricket calendar, audiences batted for entertainment content on the GECs. While daily soaps generated interest with their varied range of focus, reality content brought in male and younger viewers.

    The fragmentation, led by Colors, helped the Hindi GEC ad market to grow. Says Zee Entertainment Enterprises Ltd (Zeel) chief revenue officer Joy Chakraborthy, “We expect the Hindi GECs to take away Rs 24 billion in ad revenues during FY‘10, up from Rs 19 billion a year ago.”

    A more conservative estimate would put the Hindi GEC ad pie at Rs 23 billion, miles away from the competing genres in the broadcasting space.

    The genre did not just see ‘masala‘ content but also twists and turns in the ratings turf as Colors overturned Star Plus‘ nine-year monopoly to stay at the top.

    Also, with recession being the talking tale for ‘09, the general entertainment space faced hiccups galore. And yet with them came intelligent designs that broadcasters and markets corroborated to fight back the downturn plague.

    So how did the genre fair in the calendar year 2009? What were the major trends? How did the Top 3 channels – Colors, Star Plus and Zee TV – play the game? Did the economic downturn hamper growth plans? Read on…

    A Bird‘s eye View

    A major part of the year saw a raging ratings war between Colors, Star Plus and Zee TV as the channels used all the ammunition from their armoury for the great GEC battle. Be it staple fiction shows, reality, big movies, scheduling, marketing and promotions!

     

     

    Source : TAM

    As the GEC space opened up and audiences got more choices in terms of fresh programming and more channel options, the game was set to change in the GEC room with viewers asking for more. Competition increased as contenders for the top spots transformed as well.

     

     

    Also, in the month of May, Sony Entertainment Television (Set) overhauled its programming. During the course of the year, Sony‘s old horses – CID and Aahat – delivered and the channel moved from 80 to 180 GRPs to occupy the fourth spot.

    NDTV Imagine fought on and came up with Rakhi ka Swayamvar to grab its peak ratings. The channel gained in mindshare though in the ratings ladder it still has a long way to go.

    Meanwhile, Sab, Sony‘s sibling channel, donned the family comedy hat and started experimenting with different strands within the genre to surge ahead of Star Plus‘ second GEC Star One.

    The year also saw the death of Zee Next, while Real (a Turner -Alva joint venture) and 9X (launched by Indrani Mukerjea and Peter Mukerjea with a promise of nine times more) await a verdict on their existence.

    Opines Lodestar Universal COO Nandini Dias, “Despite two channels almost on the verge of closing down and a couple of channels not doing well at all in 2009, the genre saw a growth in its market share. This is because the gap has been compensated by the top 3-4 channels in the genre, which have performed fairly well during the year.”

    Surge in Reality Quotient

    Unlike 2008, when television predominantly targeted female viewers with high-voltage drama soaps, 2009 saw a huge surge in reality content in the overall GEC programming. And the format, coated with not just drama but controversies too, had an impact beyond its ratings. Result? Not just women but men too were driven to the genre. The share of reality shows, which was 4.3 per cent in 2008, increased to 6.9 per cent in 2009, a jump of almost 60 per cent (Tam data, HSM, for top five channels).
     

     

    Source : TAM, Top 5 GECs

    Elaborates Dias, “Unlike 2008, when the shows were more about Kyunki‘s and Kahani‘s that were mainly woman skewed, 2009 saw the launch of a slew of shows, especially reality that targeted both the woman and the men audience equally like Sach Ka Saamna and Khatroan Ke Khiladi.”

    Adds Sony Entertainment Television business head Ajit Thakur, “2009 saw GECs experimenting with non-fictions by launching reality shows other than the usual singing and dancing format.”

    Thus, while viewers were subject to some new and interesting formats like Rakhi Ka Swayamwar, Sach Ka Saamna, and Pati Patni aur Woh, there were a few that failed to catch attention like Perfect Bride and Iss Jungle Se Mujhe Bachao.

    Not to forget, some old formats did get bigger in their sister seasons like Bigg Boss, Khataron ke Khiladi, India‘s Got Talent and Entertainment Ke Liye Kuchh Bhee Karega.

    Additionally, dance-and-music-based reality shows too saw their ultimate high points on Zee TV with Dance India Dance and Saregamapa (with kid anchors).

    Says Star India EVP marketing Anupam Vasudev, “In order to appeal to urban viewers, we saw differentiation and innovation in the reality space. And thus, apart from the regular singing/ dance based shows, this year saw more experimentation with shows which created buzz for the channel and attracted a lot of eyeballs.”

    The Fiction Saga

    Well, the year surely reaffirmed the fact that fiction shows are the staple diet for Indian audiences. Tam data suggests that the share of daily soaps in GECs remained 60.4 per cent in 2009. The trend, however, shifted away from the saas-bahu sagas and the K-series to more meaningful and issue-based programming.

    “Television content has moved away from the unrealistic and over-the-top depiction of stories and characters. The focus is now on realism, socially relevant themes, positivity and family values,” suggests Vasudev.

    The trend was started by Colors and picked by all. Earlier in an interview with Indiantelevision.com, Colors CEO Rajesh Kamat had said, “There was a fatigue built in for the kind of soaps that were running on Indian television. We made disruptive and differentiated content our main plank. We were willing to take a calculated risk; our concepts were different and on the riskier side. But they worked.”

    Zeel COO and Zee TV business head Nitin Vaidya notes that Indian television saw an interesting turning point with a different kind of story-telling that emerged with newer shows. “Variants like Balika Vadhu and Agle Janam Mohe Bitiya Hi Kijo brought in an all-new flavour to the primetime,” says Vaidya.

     

    Source : TAM

    The new breed of fiction shows saw historic high points in terms of ratings. The top highest rated fiction shows in the year, as per Tam, were Balika Vadhu (10.2 TVR), Uttaran (9.6 TVR), Bidaai (9.5 TVR), Yeh Rishta (8.1 TVR), Pavitra Rishta (7.1 TVR) and Naa Aana Is Desh Laado (7 TVR).

    Avers Vaidya, “With subjects ranging from those of historical importance and social awareness to differential talent, Zee TV‘s shows have been appreciated and acknowledged across the nation. Each of our new properties yielded results and there was no show that had to be withdrawn during the year.”

    Adds Vasudev, “With competition heating up and the saas-bahu image that Star Plus had to shake off, we came up with a host of innovative, fresh and creative content to entertain our audiences this year.”

    Movie game heats up

    For a major part of the year, movies acted as a differentiator for the leading channel in the GEC genre, adding to the spikes.

    The movie syndication model allowed the Hindi GECs to spread their risks as they narrowed the window between theatrical releases and their TV premieres for new products. Explaining the movie syndication model, Dias says, “Unlike earlier days, when buyouts happened for the entire movie, 2009 saw buyouts happening in number of airings as the costs had really shot up during the year. So you saw films like Jab We Met running across multiple channels at the same time.”

    Cost corrections happened and the big bets on movies were taken by Colors and Star Plus. Some movies were aired even without breaks, facilitating weekends to see an upsurge in viewership.

    It is interesting to note here that post the two-month standstill in movie releases due to the producer-multiplex tussle, Colors ramped up its movie slate and aggressively purchased the first airing rights of many recent releases including Blue and Ajab Prem Ki Gajab Kahani.

    Scheduling strategy and break-free content

    With competition in full force and consumers moving the stick hard, broadcasters surely did not want to kick their buckets soon. In a bid to maintain a steady presence, many channels reviewed their programme scheduling strategies and also began running break-free content.

    For starters, channels began pooling their full content strength onto the 7 to 9 pm band that appealed to the non-metro masses, attracting viewers from smaller towns.

    Also, the 9-10 pm content was tailor-made for both smaller towns and metros to bring in an overlap of viewership. Meanwhile, the more urban-centric shows were moved to the 10 pm slot.

    The second major change was the scheduling transformation of hour-long episodes. The concept was first sketched by Colors, as the channel asked producers to give a special one-hour episode in a month. The idea was to increase sampling and retain viewership.

    The same design ran through Star Plus and Zee TV. “These are tactical steps taken to ensure viewers are retained on the channel and there is a seamless flow of audiences from one slot to another,” says Vasudev.

    Vasudev, however, believes that these tactical schemes cannot be sustained for long. “While one-hour specials give channels incremental GRPs, they do not impact much of the viewership in the original slot,” he says.

    Star Plus had moved one step ahead and extended their popular shows, Bidaai and Yeh Rishta, to seven days a week. However, as the model was not sustainable, they went back to four days a week.

    Says Thakur, “Scheduling of specials is a practice done by GECs nowadays to get a spike. It‘s a stunt, a smart move but isn‘t sustainable in the long run. For five episodes a week, you have to shoot for 210 minutes. You have to shoot 50 minutes daily for such spikes and that isn‘t possible in the long run.”

    Ad volume grows

    Hitting straight into the economic downturn, there was a huge concern at the beginning of 2009 that GECs would go through an ad slump and rates would tumble. That proved wrong and though rates were under pressure, ad volumes grew.

    Says a senior media specialist from a top media buying firm, “FMCG, which accounted for about 38-39 per cent of the total advertising spend on the Hindi GEC space in 2008, moved up to about 50-54 per cent in 2009. It is important to note that FMCG looks at cost efficiency and spends if there is a return on investment. Automobile and telecom sectors were also big spenders and were looking for impact.”

    Adds Dias, “With FMCGs primarily spending on the mainline GEC genre along with a growth in the genre share itself, the GEC space has certainly seen growth over others. But it may have been a more polarised growth. In absolute revenues the top three – Star Plus, Colors and Zee TV – have had a much larger pie than Sony, Star One, Sab, and NDTV Imagine. Colors has surely yielded revenues, quite equivalent to that of Star and Zee.”

    The market seems to have eased and the last three months of the year have seen a big jump in advertising revenues.

    Shaping up in Twenty10

    The GEC space can be exposed to pressure points in 2010 amidst fragmentation and stiffening competition. The fight at the top among Colors, Star Plus and Zee TV promises to get bitter. And while Sony threatens to enter the top-rung, NDTV Imagine is readying to shape its destiny under a new owner in Turner International.

    “If it is a fight amongst five strong players, then advertisers can make better use of the fragmentation. It is going to be a dog fight. But the GEC genre is set for growth,” says a media analyst.

    Agrees Vasudev, “Channels have to outdo themselves in terms of their offerings – leave alone outdoing their competition – to attract eyeballs and to keep them glued to their channel.”

     

    Media experts say advertisers will be willing to pay more in 2010 as the economy improves. “The GEC genre could post 20 per cent ad revenue growth in 2010. Hopefully, we will see clients willing to invest money in brand building. The channels, in turn, will need to reciprocate it with quality programming. Also we are slowly getting a sense that there maybe a fatigue setting in with respect to reality shows. Also believability is reducing. So maybe channels will need to look hard for the next thing now,” says Dias.

    As the overall GEC genre grows, Madison Media Group CEO Punitha Arumugam is optimistic that the profitability will also go up. “Since other genres have also started growing, 2010 will not see a very dramatic increase in the GEC genre revenues. The trend, instead, will be a fight over market share and every player will try to grab more eyeballs. But yes, profitability of the channels will increase due to renegotiation of programming and staff costs,” she says.

     

  • Zee Entertainment Q3 net up 179 per cent at Rs 958 million

    Zee Entertainment Q3 net up 179 per cent at Rs 958 million

    MUMBAI: Having gained market share in the TV ratings game, Zee Entertainment Enterprises Ltd. (ZEEL) is seeing a surge in earnings with third-quarter consolidated revenues growing 53 per cent to touch Rs 4.18 billion.

    Net profit also saw robust growth for the fiscal third quarter ended 31 December, jumping 179 per cent to Rs 958 million.

    The consolidated operating profit stood at Rs 1.36 billion, after expensing of initial investments in new activities (Zee Sports, Arabia) amounting to Rs 232 million. These are higher by 187 per cent as compared to the year-ago period.

    The results include the financials of Taj TV Ltd (Ten Sports) with effect from 13 November, ETC, international and educational businesses of Zee.

    Zee will separately announce the results of its other demerged entities – Zee News Ltd (ZNL), Wire & Wireless India Ltd (WWIL) and Dish TV. While ZNL and WWIL are already listed, Dish TV is likely to be listed by February.

    Fuelling ZEEL’s third-quarter growth has been a 59 per cent rise in advertising revenues to Rs 2.1 billion, benefitting largely from Zee TV’s prime time ratings gain and higher average rates on most of the network channels.

    “Zee Entertainment finished the third quarter with outstanding performance, highlighted by strong advertising revenue growth of 59 per cent, extremely robust operating profit growth of 187 per cent and 179 per cent growth in net earnings. Our television broadcasting business continues to lead industry in converting rating success into strong growth in revenues and operating profits. The performance reflects our success in delivering superior content to viewers and stronger relationship with our consumers,” says Zee chairman Subhash Chandra.

    Adds Zee wholetime director Punit Goenka, “Zee TV continued to increase its viewership share from 28 per cent in 2Q FY2007 to 29 per cent during 3Q FY2007, along with growth in time spent. During the quarter, average gross ratings points (GRPs) of Zee TV grew to 250 levels, with gains coming mainly from prime time. The growth has been led by continued success of ‘ Sa Re Ga Ma Pa’ , Saat Phere’ and ‘ Kasamh Se’, while our new launches ‘ Dulhan’ and ‘Betiyan’ have helped bolster the prime time shares. Zee TV now has five programmes in top 20 and 11 programmes in top 50.”

    Zee also saw gains in the other channels. “Zee Cinema continues to be the No. 1 movie channel, and increasingly is becoming a reach channel for the advertisers. Zee Café and Zee Studio have gained shares. We will continue to reinforce our competitive advantage and deliver more value to viewers and shareholders,” says Goenka.

    Contributing to the strong third-quarter performance was a 55 per cent surge in subscription revenues at Rs 1.96 billion. This was bolstered by new revenue streams coming from direct-to-home (DTH) services and digital cable. Other sales and services was Rs 116 million.

    “We are extremely pleased to see the steady steps towards digitization of the Indian cable and satellite industry. Conditional access system (Cas) has been successfully implemented in the notified areas of Mumbai, Delhi and Kolkata. With more subscribers opting for digital services even in other parts of the country, it will give a big boost to our subscription revenues in the near future. Our investment in Ten Sports is doing well. All these have extremely positive and long term impact on our business,” says Chandra.

    Elaborating on the performance, ZEEL CEO Pradeep Guha says, “We are pleased with the strong operating results in the third quarter. We have outperformed the market locking in higher advertising rates which would continue to help us in the future. Looking ahead, we are confident that continued execution of our content strategy would result in a revenue growth faster than that of industry. Additionally, with digitization of Indian cable and satellite industry, we expect to reap a rich harvest from subscription based revenues.”

    Sports business adds Rs 610 million to kitty

    The sports business revenue during the third quarter was Rs 610 million, after consolidating the results of Taj TV from 13 November 2006. EBITDA from Sports business during this quarter was Rs 133 million.

    “The main event for Ten Sports during the quarter was the Pakistan-West Indies series, which helped it garner significant revenues from the Pakistan and the Middle East beams. This was in addition to its other lead programs such as WWE, UEFA and Champions League. Ten Sports has also begun the telecast of the South Africa-Pakistan series on its Pakistan beam,” Zee says in a statement.

    “Zee Sports continued to grow on the Indian football opportunities; it covered the Asian Football Confederation under 20 championships in Kolkata in November and the Federation Cup in December. India is fast becoming a focus area for the world football governing body FIFA as well. Among some of the other events that Zee Sports covered was the Delhi Marathon, WTA tennis and the Italian Serie A. Zee Sports also bagged a three-year deal for the UEFA Cup,” the release adds.

    On a standalone basis, ZEEL posted a net profit of Rs 793.70 million for the quarter ended 31 December 2006 from Rs 341.60 a year earlier. Total income stood at Rs 2.46 billion as against Rs 2.4 billion during the same period.

    Condensed statement of operations

    The table below presents the condensed statement of operations for ZEEL and its subsidiaries for the third quarter of FY2007 versus FY2006, as published. The FY2006 numbers also include the cable, news and direct consumer business undertakings, which have now been demerged. Hence the numbers are not comparable.

    Comparable figures with FY06

    For better understanding of performance of ZEEL, the table below presents the proforma FY2006 numbers of ZEEL, on a comparable basis. These numbers are illustrative of the performance on a like to like basis.

    Segment-wise revenue streams

    The following table sets forth the percentage of revenues that each type contribute to consolidated revenues for the third quarter of 2007 and 2006.

    Comparable figures with FY06

    For better understanding of performance of ZEEL, the table below presents the proforma FY2006 numbers of ZEEL, on a comparable basis.

    Expenses account

    The following table sets forth the percentage of costs that each type contributes to consolidated expenses for the third quarter of 2007 and 2006.

    FY06 Expense chart

    For better understanding of performance of ZEEL, the table below presents the proforma FY2006 numbers of ZEEL, on a comparable basis. These numbers are illustrative.

    Segment-wise performance

    ZEEL is a diversified entertainment company with a multi-pillar approach to business. Its operations lie in three segments: (i) Content and broadcasting, (ii) Film Production and distribution and (iii) Education.

    The table below presents Zee’s third quarter performance for FY2007 in the key segments.