iWorld
Bullish predictions for the Video Industry in India fuelled by VOD services but also for linear TV
MUMBAI: The Asia Video Industry Association (AVIA) yesterday held a one-day conference, The Future of Video India 2019, with leading industry experts discussing the growth and prospects of the video industry in India.
The story of the conference was that despite disruption, fragmentation and a need for consistent and credible measurement across TV and digital streaming services, the video industry in India today is in great heath and is only getting stronger.
Romil Ramgarhia, the COO of BARC India started the day by painting a picture of growing time spent watching television and with 100m households still without TV, organic growth of TV uptake of all sorts would continue. Ashish Bhasin, CEO Greater South and Chairman and CEO India for Dentsu Aegis Network later corroborated this and said all media will continue to grow in India over the next 3-4 years.
While TV may be growing, the uptake of streaming video services is exploding with the lowest mobile data costs in the world and enormous growth of smart phone adoption still to happen, speakers throughout the day agreed we are on the cusp of an enormous wave of digital growth. Sudhanshu Vats, Group CEO and MD of Viacom18 in his keynote session predicted digital video growth would be shaped by three things – technology, culture and e-commerce.
The digital video landscape is dynamic and changing and both Gaurav Gandhi, Country GM of Amazon Prime Video and Akash Banerji, Head of Advertising VOD for Viacom18 Digital Ventures agreed that fragmentation was an opportunity more than a problem, and the move from 1 television screen per household to 3-4 screens provides a new addressable market for VOD services. Tarun Katial, CEO of ZEE5 pointed out that streaming services were not content to be only on the small screen and wanted to be able to grow consumption over TV as a device.
And while it is clear that India’s love affair with video was only deepening, the business model behind streaming video services still has room to change and evolve. Ad supported services are likely to be dominant but Sunil Lulla, the Group CEO of Balaji Telefilms pointed out that ad free subscription is entirely viable and there is enough scale for subscription to be very meaningful in India, especially where supported by strong content investments.
Shantanu Sirohi, COO Interactive Avenues at IPGMediabrands and Ashok Venkatramani, Managing Director ZEE Media were very clear that advertisers were not giving up on digital and moving spends back to linear TV. However, as Ashish Bhasin pointed out, advertising dollars will continue to grow across all services but growth on digital video was far ahead of ad growth on TV, which itself was still expected to be respectable 12-15% CAGR over the coming 5 years.
The Future of Video India 2019 was supported by sponsors Accedo, Contentwise, Discovery India, Hansen Technologies, SES, Viacom18 and Vindicia.
iWorld
Bill Ackman’s Pershing Square makes $64 billion bid to acquire Universal Music Group
Ackman pitches NYSE relisting plan as UMG board weighs unsolicited offer
The hedge fund has proposed a business combination that values UMG at €30.40 per share, representing a hefty 78 per cent premium to its current trading price. The offer includes €9.4 billion in cash alongside stock in a newly formed entity, with shareholders set to receive €5.05 per share in cash and 0.77 shares in the new company for each UMG share they hold.
Under the proposal, UMG would merge with Pershing Square SPARC Holdings Ltd and re-emerge as a Nevada-based entity listed on the New York Stock Exchange. The move is designed to boost investor visibility and potentially secure inclusion in major indices such as the S&P 500.
Pershing Square Capital Management ceo Bill Ackman argued that while UMG’s operational performance remains strong, its market valuation has lagged due to external factors. “UMG’s stock price has languished due to a combination of issues that are unrelated to the performance of its music business,” Ackman said, pointing to concerns ranging from shareholder overhang to delayed US listing plans.
Ackman also flagged what he sees as untapped potential in UMG’s balance sheet and a lack of clear capital allocation strategy. He added that the market has not fully recognised the value of UMG’s €2.7 billion stake in Spotify, alongside gaps in investor communication.
The proposed transaction would also result in the cancellation of around 17 per cent of UMG’s outstanding shares, while maintaining its investment-grade balance sheet. Pershing Square has said it will fully backstop the equity financing, with debt commitments secured at signing. The deal is targeted for completion by the end of the year.
UMG, however, has struck a measured tone. The company confirmed that its board has received the non-binding proposal and will review it with advisers. It reiterated confidence in its current strategy and leadership under Lucian Grainge, signalling no immediate shift in stance.
The proposal comes at a time when global music companies are navigating evolving investor expectations, streaming economics and capital allocation pressures. For Pershing Square, the bet is clear: sharpen the financial story, relist in the US, and let the music play louder in the markets.
Whether UMG’s board is ready to change the tune remains to be seen, but the spotlight on its valuation just got a lot brighter.
