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| Indiantelevision.com's
interview with UTV Global Broadcasting executive director and
V&S Broadcasting CEO Shantonu Aditya |
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'Strategic
investor will take stake in the broadcasting entity'
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| Posted
on 27 August 2007 |
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UTV
is lining up nine channels and is planning to bet Rs 6 billion
in it. The company is in talks with strategic investors to
support its broadcasting venture which will be under the umbrella
of UTV Global Broadcasting.
The aim is to try and carve out a place in the youth and niche
segments. The
three TV verticals UTV wants to operate on are Genx Entertainment
which will roll out the four youth-centric Bindass channels,
UTV News for the business news channel, and V&S Broadcasting
for movie and Hindi speciality channels.
The
company expects the Hindi movie channel to drive this bouquet
of pay channels along with Bindass.
In
an interview with Indiantelevision.com's Sibabrata Das
and Renelle Snelleksz, UTV Global Broadcasting
executive director and V&S Broadcasting CEO Shantonu Aditya
chalks out the road ahead for UTV's plans in the broadcast
space.
Excerpts:
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How is UTV arranging funds for the slew of nine channels it
plans to launch?
The total investment requirement for these nine channels
is Rs 6 billion. While UTV will be investing Rs 1.5 billion
as part of its contribution, the balance will be raised by
a combination of equity at a premium and any other suitable
instrument.
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Is UTV in talks to rope in strategic or financial investors?
We are in advanced talks to get a strategic investor who
will hold minority stake and come in at a premium.
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Will the strategic investor take stake in UTV Software Communications,
which is the listed entity, or in the broadcasting arm?
It will be in the broadcasting entity and not in UTV Software
Communications. The broadcasting initiatives are under UTV
Global Broadcasting. It has three wholly owned subsidiary
companies - Genx Entertainment, V&S Broadcasting and UTV
News Ltd. I wouldn't be in a position to comment on exactly
where the investor is going to take a stake.
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Does
UTV Software Communications have a stake in UTV Global Broadcasting?
UTV Global Broadcasting is privately held. But this equity
ownership arrangement could change after the investor is roped
in.
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UTV had earlier announced that Genx, which would launch the
Bindass channels, would be a joint venture with Astro as an
equal partner. So is it that the three subsidiaries would
be having different partners and still you would have an investor
in the parent company?
It is premature to discuss this at this stage.
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Is there a possibility of Astro picking up stake in UTV
Global Broadcasting?
As I said earlier, we can't comment on this at all.
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Will UTV News Ltd. have a separate structure as news channels
uplinking from India come under a 26 per cent cap on foreign
investment?
We will abide by the current guidelines on investment
in news channels.
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Speculation is that a group of Indian investors are going
to invest in the news channel?
We
are speaking to a number of interested investors. It will
be premature to mention any specific names at this stage.
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Will you be launching Bindass it in the first week of September?
We will be progressively rolling out all the nine channels
by mid-2008. Bindass, the youth Hindi general entertainment
channel, will be up soon. This will be followed by Bindass
Movies.
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Will they be pay channels?
All our channels will be pay from the first day of launch.
The first two channels are priced together at Rs 20 in non-Cas
(conditional access system) and Rs 10 in Cas markets.
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'If
you have a good acquisition and syndication strategy,
you can build a successful Hindi movie channel'
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What are the other two channels to be launched by Genx under
the Bindass brand?
They will be in the regional space. Most probably they
will be Tamil and Telugu language channels. But we are currently
conducting research to support this.
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What are the four channels being launched by V&S Broadcasting?
We will be launching a Hindi movie channel which will
drive our distribution bouquet along with Bindass. We will
have a world movie channel and there will be two Hindi speciality
channels. We are also launching an English business news channel
as we feel there is a considerable gap between viewer expectations
and what they get right now.
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What
are the scheduled dates for these channel launches?
We are launching the World movie channel in November. The
two Hindi speciality channels should be up in January and February.
The business channel is targetted for a January launch and we
should be ready with the Hindi movie channel in February. |
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UTV
had tied up with Palador Pictures for the world cinema venture
with Olive as the brand. But with the split and Palador getting
back all the titles, isn't it a setback for UTV?
We have already acquired 150 titles and are looking at 300
at the time of launch. We will be screening the best of contemporary
cinema and see a big opportunity in this. There are award winning
titles and there are also good films from Bosnia, Iran and Argentina. |
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Will
high-priced DVDs be an important source of revenue and support
system for this kind of cinema which will in any case attract
niche audiences?
We will have DVDs and theatrical release. We haven't decided
whether we should go in for a high pricing or a volume strategy.
But the channel has to drive by itself. |
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How
will you make a mark in the Hindi movie channel space when
the existing players are entrenched, many more are on eve
of launch, and acquisition costs are high?
We are looking to launch with a bank of 300 titles, of
which 50 films have already been acquired. The dynamics of
the business is also changing. I see a syndication model coming
into place and a lot of sharing of titles across channels.
You may not see clean straight exclusive deals over a longer
period as in the past. There will be a variety in the way
you purchase movie rights.
If
you have a good acquisition and syndication strategy, you
can build a successful model. Movie channels are platform
agnostic and audiences are loyal to titles.
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While
several broadcasters are eyeing the GEC space, why is it that
UTV decided to foray into the niche genres of special interest
channels?
We have consciously decided to stay away from launching
a general entertainment channel primarily because there has
been a drop in viewership of 30 per cent in the Hindi GEC space
in the age bracket of 15 – 35 years. The market needs segment-dedicated
channels - and that is the domain we are entering into. |
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Distribution
of the new channels is a critical area. Have you set aside huge
carriage costs?
Carriage charges are a challenge. However, we have signed
contracts with almost all the multi-system operators (MSOs)
for our first set of channels. |
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Have
you stitched deals also with the direct-to-home (DTH) operators?
I can't comment at this stage. |
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Given
the current media boom that the industry is witnessing, how
are going to attract and retain talent?
We have already recruited around 170 people for our broadcasting
business. We are drawing in talent through a combination of
compensation and stock options. Retention is a big part of our
strategy. |
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