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Rewind 2010: The big objective for the broadcast industry is to achieve critical mass urgently - Sameer Nair, CEO, Turner General Entertainment Network

Rewind 2010: The big objective for the broadcast industry is to achieve critical mass urgently - Sameer Nair, CEO, Turner General Entertainment Network

Author | Noor Fathima Warsia and Fatema Rajkotwala | Friday, Jan 07,2011 7:43 AM

Rewind 2010:  The big objective for the broadcast industry is to achieve critical mass urgently - Sameer Nair, CEO, Turner General Entertainment Network

Technology, design and entertainment – three things that Sameer Nair, CEO, Turner General Entertainment Network, believes drive the growth of any business, especially the media business. For Nair, the game changer for the media industry is going to be primarily technology, and he believes in the years ahead, the industry will have more opportunities than challenges.

As curtains come down on a decade of entertainment in India, Nair speaks to exchange4media on what are the things to watch out for in the decade ahead.

Let’s begin with one of your favourite subjects – distribution. With digital households actually showing growth now, do you think the big hopes of addressability would finally manifest into something next year?
Next year would be a stretch. It will still take about five years to coalesce into a decent critical mass of digital homes that would make some kind of a difference. You can always be surprised, like we saw with mobile telephony that really leapfrogged in the past few years. But I think digital homes should get to a critical mass, which means enough number of homes in specific markets, by 2015. 2011, and even 2012 will continue to be the same kind of fight we already are in. A street fight for slots, for shows, ratings and that sort of thing.

We will not wake up on January 1, 2011 feeling spectacularly different or new, but over a period of time, I think some of these dynamics will come into play. I think niche and specialty channels will come into their own when they have a strong enough subscriber base. Currently, everyone is hamstrung and a little disadvantaged because the rating system does not measure their performance well enough, which hampers them with regard to advertising. And on the other hand, from a subscriber view point, they don’t actually command premium rates because it is fairly commoditised. In time and with volumes, all of this will sort itself out, re-arrange itself, between classic free-to-air television, genuine Pay TV and highly valued Premium TV.

But when we talk digitisation and digital markets, should one get worried about observations that most of these numbers are from rural households?
Nothing to worry, but it helps to be realistic. The numbers are dispersed over various demographics. Not all of DTH is necessarily an upgrade from analog TV. Some of it is rural, some weekend homes, some low value audiences with no easy access to cable, split between North (HSM) and South… so, one shouldn’t get carried away with the idea of digitisation or the absolute number of digital homes. But India is a large and growing economy; we have a long way to go… and the potential is immense. Again, we need to reach critical mass, reach a tipping point, in core monetisable markets.

… But when we are talking in the context of super-specialty channels?
In an ideal scenario, you should have many specialty channels that are made available on DTH platforms to these upmarket, upgraded households that will then subscribe to these channels and pay good money for it. This is correct in theory, whereas the practical aspect will take a little while longer because there are various other dynamics at play. The DTH companies have their business plans to manage, they have extremely high costs; they currently compete with the analog businesses, so they have to maintain price-points of that kind. All of this will change once we reach a critical mass – for argument’s sake, of about 50 million digital homes in HSM markets. At that point, a whole new math will start making sense, because you can reach out to an audience, make a specific offer to that audience and various percentages of that audience can choose to buy or not. That is real money.
So, from distribution standpoint, there clearly are interesting times ahead.

What about from content standpoint, say for general entertainment genre. The last decade saw the growth, de-growth and re-growth of the genre. What next?
General entertainment as a genre always remains strong. Because general entertainment had been so totally dominant (between 2000 and 2007) that when you saw even a slight a shift in the market, everyone started talking about GE losing ground. If you think about it, there were three Hindi GE channels in 2000, while now there are about eight or nine. More importantly, there were about three news channels, whereas now there are about 60 today in the Hindi space and as you know, the bulk of news channels play large amounts of general entertainment content on a 24-hour news cycle in equal parts of promotion and editorial. If you take that kind of content and add it back into the general entertainment pie, it is still the general entertainment share. In that sense, the audience for the category has expanded.

Also, general entertainment should not be considered as only Hindi general entertainment. From 2000 to now, many regional general entertainment channels have added to the mix. So, the general entertainment category in reality has expanded, the Hindi general entertainment at one point may have dropped because it went to news or to regional language, but with the arrival of new players, it reclaimed that as well. Also, general entertainment tends to be the blockbuster category. It attracts the largest audiences, brings everyone together and then spills off from there. If you want to reach out to mass audiences, you can’t beat GE. Sports is another powerful category, but it tends to be uni-dimensional, male and infrequent. General entertainment is more consistent, all-year round, more inclusive – it has families, 6-60 year olds, males and females, music, movies, comedy, action, drama – general entertainment is your perfect masala Hindi movie.

What are your hopes on genres like movies, music as we move forward?
Not just movies or music, but across categories, as creative people, we often have a world view on how audiences ought to behave, but their reality is different, their viewing conditions may be different. It is never a one-size-fits-all. In the next three to four years, there will be a lot more of these smaller battles, no one big war that will be fought or won. Also, because of the multiple options that are available to people, they have much shorter attention spans, which makes them quicker to respond to newer things and even quicker to leave them behind.

And interestingly, the same young, new, changing audience we cater to are also entering our own industry in the form of many younger people who come into the business bursting with fresh ideas. I read a nice quote the other day: ‘I am not young enough to know everything’ – the younger talent is a force to reckon with, and we keep seeing that in creative industries around us.

Are you seeing that kind of bright talent around you in the industry?
I think so! I see so many bright, clever, ambitious and determined people. It is really vibrant at this point. At a competitive level, I have the highest regard for my peers and colleagues in the industry. No one has a crystal-ball to work out what audiences want. It needs ideas, practicality, passion, quick and smart thinking. From 1991 to now, we have our first generation of satellite TV executives. We are talking about a bunch of people who have been here for 20 years, and then another bunch of people who have lived and worked for at least 10 years in this competitive cutthroat business. We are talking of people who have earned their stripes and are now moving forward, with superlative creative energy. And they know how to deal and work around ground realities.

Wouldn’t that still mean working with limitations of sorts?

Habits die hard and people tend to stick to rituals. There is no getting away from it. People also tend to consume entertainment in that manner. In reality, TV is the ultimate ritualistic medium. You can compare TV with a temple of sorts, you arrive every evening and watch TV – that is a pattern, a ritual you follow, and this will continue for a while. For audiences, that ritual-viewing, the way they do it, the habits, the favourite shows and favourite stars are the big deal. What we try and do is create something new that will hopefully interest people, break one viewing ritual and replace it with another… and sometimes, with some luck, it catches the fancy of a nation.

Slowdown was another highlight of the decade gone. Do you think it changed the industry in some manner?
The slowdown happened. For the media business, it meant that there was a lot of investment coming in on the assumption that at the end of every rainbow, there was a pot of gold. And when the collapse happened, some of the rainbows evaporated… but not because of weak Indian fundamentals, these are robust. The reasons for those failures are different. There are lessons learnt, but our business is only about tomorrow, not yesterday.

But the slowdown did change the way advertisers are looking at the business, especially since there is advertising revenue dependence in our industry...
For some players, such as us, yes. But the business per se has already moved to a 70:30 advertising to subscription mix of revenues. Three things drive the world – technology, design and entertainment. For us, technology is going to be the game changer. India is as good as anywhere in the world for the kind of content available. If you look at what TV has to offer, you have GE in various languages, including English, sports, news, knowledge, kids, movies, pretty much everything. The best shows abroad are here. Next month we are going to do ‘Wipe Out’. You’ve already seen ‘Millionaire’, ‘Big Brother’, ‘Fear Factor’ on TV, so Indians have really nothing to complain about. What will push it forward is technology, which will then begin creating interesting and unique critical masses.

And before we end, what are your views on the changing dynamics in the advertiser and media buyer relation, which has become more about procurement and beating down prices?
Well, the industry is growing, isn’t it? Life itself is a negotiation. Advertisers have to reach audiences, and they have to do that via media. “Media” is in the business of creating – entertainment and information for audiences, and vehicles to reach audiences for advertisers – and we look to advertisers for defraying some of that cost. There is a balance of power, there are good days and bad days, but by and large everyone is fine. If it is indeed the horrible relationship that it is made out to be, then the industry wouldn’t be growing by 10-15 per cent every year. And don’t forget, India is a considerably under-advertised market. So, for the next 10 years, we can expect at least five or ten new brands to be born in every category. And these will be big guys, who come and advertise in a big way – that is what will drive the industry forward. Advertising will continue to be an exciting area for quite some time to come!

But the most exciting of all would be attaining that critical mass you talked about?
Yes, and that will take its time. At present, specialty and niche channels are having the hardest time of their lives, but it will all fall into place when we reach critical mass. The big objective for the broadcast industry in the years ahead is to achieve critical mass urgently and then we will see the most amazing numbers and ideas emerge. And there is no reason to believe that the device that changes our world has to be the immobile STB. It could possibly be a 3G or 4G mobile device. You never know, and that’s what most exciting.


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