Viacom18 Group CEO and Chairman CII National Committee on M&E, Sudhanshu Vats gave the closing speech at the Media & Entertainment Seminar on the third day of Make in India which was also chaired by Colonel Rajyavardhan Singh Rathore, Sumit Mazumdar and Ramesh Sippy
Excerpts from his speech:
Defining ‘Make in India’:
Sometimes we get carried away with the concept of ‘Make in India’ and think of it in terms of big machines, big companies and big resources. But Make in India is at the heart of every Indian, every individual. And it was actually interesting to see Shri Narendra Modi, our honorary Prime Minister, on Saturday, emphasising an integral point: Make in India is a program that is supposed to do two things. 1) It is supposed to generate jobs for our youth, and 2) Be a platform for our youth to become job enablers and entrepreneurs. It is in this context that Media and Entertainment fits beautifully. The ability of an Indian and everybody associated with the M&E industry to do that is fantastic. It is this concept I would want to build up on first.
The size of our industry is close to about 18-20 billion dollars. India boasts of the world’s 3rd largest TV audience, 2nd largest print circulation, largest film output and one of its largest Internet audiences. Yet, at ~17 Bn USD, our entire industry earns less than some of the world’s largest media conglomerates. The latest edition of the Star Wars franchise has already crossed over 1.5 Bn USD in global ticket sales, more than 2x of global collections (including gross domestic collections) of all Bollywood films in CY15.
Some will attribute this dichotomy to our content: is the comparison even valid? ‘Can we even think of matching the production budgets of global tent-pole properties?’ ‘Are our stories universal in a way that they appeal to the entire world?’ Others make references to economics to explain the chasm: in terms of purchasing power parity we are significantly greater than based on our ‘nominal revenues’. There is another lot (including myself) that looks at the regulatory framework for answers: shouldn’t pay TV pricing be completely deregulated if we want to deliver quality content? ‘We need addressability across India to ensure that the entire value chain gets its fair share of revenues.’
The Global Spotlight is here:
All these voices are acceptable, rational and attention-worthy. It might be prudent to point out that for our sector to attain escape velocity a deeper, more holistic view is required.
But I think the Make-in-India program has placed the (long overdue) global spotlight on India’s economic potential. And for the Media and Entertainment industry to realize its true potential, I would like to emphasise on what our honourable Prime Minister rightly described in his inaugural speech: The idea of the 4 Ds. Reiterating what he said, India is known for 3 Ds, which is Democracy, Demographic dividend & Demand. But now the time is to lay emphasis on the 4th D, which is deregulation.
For Indian firms to compete successfully, we need a light touch, consistent regulatory approach when it comes to our content, pricing and licensing- one that ensures parity across technology, platforms and jurisdictions. Multi-dimensional capacity building is the need of the hour. This theme has been repeated so often that it’s on the verge of becoming cliché. Yet that doesn’t take away from its relevance even today.
The Next Level of Growth:
If we truly want to transform this country into a global content powerhouse we need to invest in human capital and infrastructure. We employ around 5 Mn people today. We will easily need to double our workforce in the next 5-7 years to realise our goals. This includes talent from the creative, technical and management spheres. We need to invest in this talent pipeline today, if we are to reap the benefits in time. The industry needs to collaborate more with educational institutions, the government needs to facilitate these partnerships and parents and teachers need to create awareness and nurture interest in design, technology and creative skills at the level of primary education.
On the infrastructure side, while BharatNet is a commendable step, we need to expedite its rollout. Even today India has mobile-dark villages and some would argue that broadband speeds are too dismal to even be classified in the way that they are. Public Internet access is fast becoming a basic necessity in the lives of most Indians. Finally, infrastructure in the form of convention centres, stadia and venues for experiential entertainment needs to be built to support our industry. If we don’t get this piece right, the puzzle will remain incomplete.
What ails the M & E Sector:
Today, the M&E sector contributes to ~1% of India’s GDP, much lesser than its counterparts in developed economies. With time, as it grows in importance and scale, this contribution is bound to increase exponentially. The sector’s very inclusion in this flagship programme underscores its importance. Several policy measures under the aegis of the ‘Make-in-India’ programme are well intended. We are eagerly awaiting the new IPR policy, which is a much-needed intervention to ensure that our industry prospers. A steam-lined investment approval process and favourable foreign trade policy regime is bound to provide our sector with a fillip. The Make-In-India programme is a right step in the right direction. It has captured the imagination of people around the world, bolstered spirits within corporate and policy corridors and set the ball rolling for much-needed reform measures.
We power several ecosystems, beyond our own. As per press reports, over 18 Bn USD of investment proposals have been received in electronics manufacturing, particularly by mobile handset manufacturers. Have we ever stopped to ask about the utility of that awe–inspiring device with a 5-inch HD screen with 64GB storage and oodles of computing power if we don’t have high-quality, engaging video content? Media rights are the single largest contributor to almost all sporting leagues in this country. FMCG companies spend a significant portion of their top-line (~10-15%) on advertising because it contributes significantly to their growth. French islands and Turkish cities witness an increase in in-bound tourists after they’ve been featured in our films. We’re more than just us.
The first thing is to continue the journey on deregulation. Keep it light with policies that are thought through. The second thing is in the area of IPR. And I think if the M& E industry has to grow further, we will need to have a very well-articulated IPR policy and the good thing is that the honourable Prime Minister himself spoke about this at the Make in India inauguration event.
We need to seamlessly blend technology and creativity. For that, we will need more physical infrastructure for us to be able to organise events that do so more regularly, more frequently and more safely. I think that is the third area where the impetus is on us for building better physical infrastructure.
My final point is in the area of building capacity from the point of view of multidisciplinary talents. Because ours in a converged world, I think it’s the combination of talent and management, talent and creative content, and talent and technology which will allow us to progress.
The M&E sector is a key pillar of the Make in India programme and is bound to gain from it, and gain it should. After all, when we ‘Make in India, For the World’, we also ‘Make in India and Show the World.