Keertan Adyanthaya, MD, NGC Network India & Fox International Channels talks about the tardy implementation of digitization at the ground level, the challenge thrown by Star RIO, and Discovery being healthy competition.
What according to you were the key highlights for the broadcast industry during the year 2014?
There are two or three highlights for the broadcast industry. The first one really is digitization. It took pace in a very aggressive manner in the first half of 2014. Of course it slowed down towards the second half because of certain policy decisions that were made. The second big one for the broadcast industry really was the emergence of sports beyond cricket. Sports like kabaddi, badminton, tennis, etc. as well as ISL football, I think this will showcase a new dawn in broadcast television. It will give people more options to watch, it will give advertisers more options to spend on rather than just one form of sport which was India domestic cricket or Indian cricket such as IPL. So these are two key developments in the broadcast industry for the year 2014.
What were the top developments in your genre in 2014?
Over the past three years there were some naysayers who started saying that infotainment as a genre is dying out and that it doesn’t have the necessary kind of vibrancy anymore and many other genres are experimenting more and coming out newer concepts and channels, etc. But what we have noticed is there have been only two genres that have grown in the special interest segment and that has been infotainment and the other has been youth, and infotainment has actually grown by 20%. What is of particular interest to us there is that National Geographic has grown by 40% in the last 3 years and that growth has been really fueling the genre itself. When it comes to lifestyle which we are in, it was Fox Traveller earlier which is changed to Fox Life recently which has fuelled the growth. Our channel over the past three years has grown by 70% and the genre has grown by 10%. Fox Life is the size of both its competition put together. A 50-55% market share is what we enjoy and very few channels in any other category can claim that kind of a dominant market share. When we changed from Fox Traveller to Fox Life we had a down turn in our graph and we lost some shares but rapidly within a space of 3 to 4 weeks we have caught up and now we are dominant leaders once again.
Have you witnessed any changes post phase 1 & 2 of digitization for your channels?
I think digitization is something that key people in the broadcast sector whether it is the Information and Broadcasting Ministry, whether it is TRAI, broadcasters themselves and MSOs have been pushing for this in a very aggressive and focused manner. The broadcast channels under the direction of the IBF have been sustained campaigns on our own channels which tell people that digitization is here, you should be digitized, you should ask you cable operator to give you a form where you can select the channels that you want to watch. But I think at the ground level where implementation of this is concerned there the progress has been very tardy. So they have paid lip service to digitization, yes channels are coming into the houses digitized but beyond that there has been no progress at all. People have not tiered channels, so all the digitized houses get channels at a flat price.
That was not the final aim. The final aim was to give choice to the consumers. To give him a low price point where he can get the most popular channels, then he pays a slightly higher price for the channels that he wants and maybe an even higher price for sports channels. So that is what tiering was supposed to be. You can see that in operation in DTH and DTH has half the share of digital homes. So one half of India has gone digital with tiering but according to the cable operators the other half of India is not ready. I find that very hard to believe. And that is what I mean by tardy progress in digitization. They have really not gone there and made an effort to seed the right kind of boxes, to collect the forms back from viewers asking them what channels they want. Which is why it is lip service to digitization and those are the problems we are grappling with. Each time we extend deadlines for digitization, it is not like someone is taking advantage of that extension. It is like a lazy student who gets a lease of extension for the exams and still does not study until the last moment. That is exactly what is happening in the industry that nobody has been using that time in a productive manner. This deadline has been extended multiple times but each time nobody used that deadline except to ask for another deadline extension. And as broadcasters we have done everything that we can. We have devoted hundreds of thousands of our precious air time to promote digitization and leaves us asking the question, what is the point? Why are we doing all this when the other stakeholders are not interested in it at all?
On the distribution front with Star India opting to for RIO, how has that impacted your channels?
According to the scheme of this all channels before RIO came into place were in base pack, they were in one pack, there was no such thing as base pack among the digital MSOs because everything was one pack. So in our efforts to create a free and fair atmosphere people could transparently buy our channels we have gone with the RIO pricing. However, again it is being used as a stick to beat us down but we are confident that given time we will be able to impress upon the customers that our channels are must have channels. We have been making a fair amount of headway. We have managed to get a lot of platform partners to agree with this position and start carrying our channels. But it is not a short term measure, it will take time to convince everybody. NGC has been around for 12 or 13 years and we believe that for the well being of this industry this is a step that needs to be taken so we are going to go the distance.
What are the challenges that TV broadcast industry had faced during 2014?
Our biggest challenge is the whole RIO and extended impact of digitization. Another challenge really is that we create local programming and productions that you create out of India. We create nearly 80 hours of local programming and maintaining quality and attaining big highs creating successful programs was another big challenge.
What properties have been the highlights for your channel during the year?
On Fox Life 30-35% of our content is Indian and on NGC about 15-20% of our content is Indian. But what is increasingly encouraging is a lot of the shows that we create from India, ‘Make in India’ like the Prime Minister (Narendra Modi) coined, so we have been making a lot of shows in India and in the recent year or so they have been getting picked up and travelling around the world. So for instance we created a show called ‘Inside the IPL’ which is all about how the tournament is put together and I am happy to say it is being shown in South Africa, Australia, United Kingdom and Canada, so in many countries it has been picked up. The show ‘Life Mein Ek Bar’ was aired on Star World in the South East Asian region from Middle East to Australia to Japan and it was among the top 3 shows for the month there. And it had to fight with the American shows like Glee and American Idol, etc. and it has been among the top three shows, so that has been very encouraging. Other shows that we have created like ‘Twist of Taste’ and ‘Style in the City’ they have been picked up by channels in Germany and Italy and aired on their own local language channel after dubbing into the local language. So these are all signs of the shows travelling far and wide. It (content syndication) is emerging to become a big part of our business, until now it was not really large. We only started producing this many hours over the last couple of years, around 3 years. Normally syndicated shows require multiple seasons, so that they can continue with them. I see it doubling in the next two years.
Competitors such as Discovery have recently launched new channels and are expanding, what are your thoughts of competitors and what are your expansion plans?
Discovery is a very capable competition that we have. They have their presence in a lot of niches of this category and they have got pretty good offerings. They also keep pegging way at the core premise of expanding people’s knowledge so it is good competition to have, they keep us on our toes. They also challenge us to create better programming. However, I can’t say the same for other people in this genre who masquerade as being a knowledge and infotainment channel but are just men’s entertainment channels. But between Discovery and us I find that there is a lot of healthy competition. Our expansion plans are that we have channels like Nat Geo People, Nat Geo Music, Baby TV also Nat Geo Wild and really we have stayed away from paying carriage fees to get these channels distributed. So now with digitization setting in we see that we can get these channels carried across multiple channels and consolidate our gains on these channels.
What are the brand categories which had been active on your channels in 2014?
Ecommerce has been pretty big, FMCG has been present on our category in a big way as well as mobile phones and automobiles.