There is an explosion waiting to happen in the Indian entertainment and media, but first certain issues, including regulatory issues, need to be sorted out. Better content, long term plans and constant innovation will also aid to the growth of the Indian entertainment and media industry. A PwC panel discussion held in Mumbai on July 29, 2009, highlighted several interesting aspects of this industry.
After registering a growth of around 16.6 per cent in the period 2004 to 2008, the entertainment and media industry in India, according to the PwC report in its 2009 edition, is set to decelerate to 8 per cent in the year 2009. The CAGR projection for the entertainment and the media industry over the period 2009-13 is 10.5 per cent. While 10.5 per cent may be nowhere near the 20 per cent growth, which the Indian entertainment and media industry has seen in the last few years, for the western markets this is a huge growth.
Panelists at the special PwC panel discussion included Timmy Kandhari, Leader – Entertainment and Media Practice, PwC India; Marcel Fenez, Global Leader - Entertainment and Media Practice, PwC; LV Krishnan, CEO, TAM Media Research; Ravi Mansukhani, MD and CEO, IndusInd Media and Communications Ltd (Hinduja Group); Rajesh Sawhney, President, Reliance Big Entertainment Pvt Ltd; Biren Ghose, Executive Director, EROS International Films; KU Rao, CEO, DNA; Bharat Ranga, COO - International Operations, Zee Entertainment Enterprises Ltd; and Jagjit Singh Kohli, CEO, Digicable Networks, India. The session was moderated by Tina Tandon of UTVi.
Lessons learnt from the downturn
Commencing the discussion, Ravi Mansukhani noted, “During the economic downturn, we had taken some hard decisions, we rationalised a few issues and have also become cost effective, and this, I believe, was one of the positive aspects.”
LV Krishnan observed, “While consumers have stayed with television and radio, the acceptance of digital platforms have also increased, and by August 2009, we even expect to see 18-20 per cent homes already into digital television. Interestingly, Delhi seems to be accepting newer contents and this trend is likely to catch up in other cities as well, therefore, leading to fragmentation at a higher level.”
Rajesh Sawhney said, “We at Reliance Entertainment change everyday, every minute and focus a lot on innovations. I believe this downturn has taught us to be cash tight, and the long term prospects of the entertainment and media industry by and large has remained unharmed.”
Biren Ghose noted, “Today, it is the consumers who decide and the judgment they make are instant, even before the product is out, and what we need to do, particularly in a recession or slowdown period, is to dig deep into the assets of the past.”
KU Rao remarked, “We in India are fortunate to grow rapidly, even though it is an 8 per cent growth in 2009. I believe we will see a lot of FDI in the country. In the media fraternity, we may also see an increase in collaboration between print and television, and a possible pattern between the Internet, radio, out-of-home and so on. In fact, I see the entertainment and media industry in India having better growth in six months. We will report better results and the media industry will also look profitable.”
Jagjit Singh Kohli said, “Slowdown is not something that we need to worry about in our industry. Yes, it has affected us, but we need to worry about devising a method of sharing with the shareholders. Digitisation should have happened long time ago in India, but is lagging because of lack of government willingness. Even today I believe digitisation will not happen at a faster rate. Therefore, it is the willingness and the capacity that needs to be tapped, and once this happens, the industry will see rapid gains it has never seen before.”
Mansukhani of IndusInd Media and Communications, pointed out “With digitisation comes transparency in the system, and from the cable front it helps bring in fragmentation and thus help increase subscription level, because it is catering to a particular segment. I believe that without digital implementation we are not going anywhere, as digitisation is the key for the growth of the cable industry.”
According to Ghose of EROS International Films, “The next wave of film making is expected to see more capital. There is going to be a greater alliance with the eco-system as it has been and still is a talent driven medium. The one thing that has been positive for the industry in this downturn is the fact that it has brought us all closer than ever before. The maturity of any industry is that the industry players learn to consolidate and learn from the mistakes made from others and its own and when this does happens growth will also be rapid.”
Sawhney of Reliance Big Entertainment said, “What we need to do is make sure that the brand is recognised and understood and it should be done constantly as it is the brand that matters. There is a bit of digital in every platform, and going forward we will also see a lot of interesting content on mobile as well. We do have a bright future, however, we need the right business model.”
PwC’s Fenez explained, “Every market has different issues, but it is the access and the price of access that differentiates any market and this is the real issue that needs to be addressed, and once this is addressed accordingly, then we can expect consumers across all markets to behave similarly.”
Agreeing with Fenez, Kohli of Digicable Networks, India, said, “Access is everything and different countries will behave differently, and this is one of the biggest challenges that India is facing in terms of digital penetration. I also believe that it is no longer about prime time, but ‘Your Time’. However, the important role is that of distribution of content and this can happen only when we have sorted out various issues, and I also believe that that there is an explosion that is waiting to happen in the entertainment and media industry.”
Krishnan of TAM Media Research stressed, “Innovation is the key in any field and at any time. I believe the media and entertainment industry can never hit a recession, however, going forward, we will see more of content innovations and marketing and this is going to be the key focus.”
“I believe the way forward is going to be better content, longer term, and thus leading to better yielding,” concluded Zee Entertainment Enterprises’ Ranga on a positive note.
Indian E&M industry to grow 10.5% in 2009-13; OOH advertising pie to drop: PwC