iWorld
Need to create a new creative ecosystem for multiple platforms: Sameer Nair
Mumbai: The OTT streaming business is not for the fainthearted and players with light wallets, said Applause Entertainment founder and chief executive officer Sameer Nair as he talks about the evolving streaming business at the CII Big Picture Summit.
While there is an opportunity to make it big in the business, it’s important to ensure that it reaches a critical mass of subscribers. “And to do that you need to make investments,” said Nair, discussing how several OTT platforms turned out to be making losses.
Elaborating on why he decided to enter the IP creation business, he said, “We are trying to work with a movie studio model. Attract a certain risk capital and produce some content. TV was funding IP creation and so the upside was being reaped by TV broadcasters. Producers did not get the upside of owning the IP. Today, there is an opportunity for content companies who take a degree of risk in content creation and license it to platforms.”
Until now, TV was driving investments into original programming in India as it was catering to a mass audience. It was dominated by celebrity-led reality shows and daily soaps and that’s what consumers were watching for decades. But OTT has unlocked a new audience as it caters to a mass of niches. “For example, let’s say 10 per cent of the country likes the crime genre, that’s the size of a small European nation,” he said.
But when it comes to paying for streaming services, then consumers look at the service that offers them the most value for money. “We never had HBO or Showtime in India in terms of producing original Indian content for a digitally-savvy audience. The creative ecosystem was catering to TV and films. We need to create a new ecosystem and content for multiple platforms,” he highlighted.
According to Nair, OTT platforms also offer more data on consumers so decisions can become more informed, unlike TV where broadcasters always struggled to understand consumer behaviour because TRP was the only metric. The advantage for streamer is that can be “massy and classy”. A show can be created in a widespread spoken language but subbed or dubbed in multiple regional languages at the same time hence broadening its appeal.
Talking about recommendation engines on OTT platforms Nair said that like any other algorithm the more you use it, the more you get out of it. “To say that I’m being shepherded by the recommendation engine and it is reducing my choice is not a fair comparison. Everyone knows that a consumer’s content viewing choices operate between new and comfort. That’s why Netflix has the ‘Play Something’ feature,” he said.
There is a notion that TV is free and that the consumer has to pay for OTT. That’s why many consumers are still keen on ad-supported streaming services. Nair said that consumers were always paying cable distribution companies to watch TV. Similarly, today OTT services are built on top of broadband companies and telcos.
Speaking about ad supported streaming, he said, “Every time you do anything regarding messaging and selling within a content experience, then it becomes an art.” There are all sorts of ways to monetise content and a lot of companies are trying to crack it. “Netflix has 214 million paid subscribers and it is the most premium streaming service globally. If five people are sharing a Netflix account then 200 million becomes one billion. If they’re watching Netflix two-three hours daily then that’s how many premium customers there are who don’t want to come into contact with regular advertising messages,” he observed.
Nair said that the lockdown has been a uniform experience for nearly every human being on the planet. “We used to think TV is our window to the world but actually TV is only the window into your neighbourhood. The internet is the window to the world,” he said. The inevitable outcome of this is that the consumer has become used to the fact that there is a lot more content to watch.
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.
