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NDTV Ltd looks to expanding beyond news, plans to roll out five new channels

18-October-2006
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NDTV Ltd looks to expanding beyond news, plans to roll out five new channels

NDTV Ltd on Tuesday unveiled its new corporate model, which enables NDTV to raise funds for its future businesses beyond news. The new company, NDTV Ventures, will incubate and operate focused verticals in this space. The corporate model will permit investments by strategic and financial partners in individual verticals, as well as in NDTV Ventures. This expansion will help enhance NDTV shareholder value.

NDTV has over the years nurtured a large pool of creative and technical talent, many of whom will now provide the human resource base for the new verticals. The transfer of these human resources and other assets will allow for the quick rollout in areas like the Internet, technology, entertainment and lifestyle.

Dr Prannoy Roy, Chairman, NDTV, said, “The new model is based on an entrepreneurial management structure aimed at attracting and rewarding the best global talent in the business, including the large talent bank within NDTV. The model will help streamline existing operations and make them more cost efficient.”

“It will be a major leap forward for NDTV and the expansion will see major inflow of investments, which the company will raise internally as well as through private placement of equity, IPO or other possible routes,” Roy added.

He further said, “Our basic vision is to earn revenues of $500 million in the next five years. Our focus is triple-fold – Internet, TV, mobile. We are uniquely positioned to become a global Indian media brand. This is the next big thing. We are looking at a Hindi entertainment channel. We have done a huge research on it. We believe it is less cluttered and the first two years it’s going to be free on air entertainment channel.”

He also announced plans to launch four English city centric channels soon, called NDTV Metro nation, which will be funded through debt equity. “We are yet to finalise on partners,” said Roy, adding, “We feel there is a gap in the market. We are launching in Delhi, Mumbai, Kolkata and Bangalore. The channels will be a mixture of sports and local events. We are launching regional languages business channels in the coming year.

According to company sources, NDTV Metro nation is likely to go on air over the next two to three months’ time as details like content, distribution and pricing are fine tuned.

This corporate organisation will also facilitate strategic growth in NDTV’s existing news operations and expansion within India and internationally. The channel has just been launched in Indonesia. The channel will be launched in Malaysia early next year then in the US and the UK.

Roy said, “An NDTV venture is being set up. However, we haven’t yet decided on the CEO. One of the options we are looking at is an IPO, but the date is yet to be decided upon.”

The new model envisages having NDTV Ltd as the parent entity with news and non-news operations under it as separate subsidiaries. Each of the subsidiaries would have a number of verticals, NDTV’s chief executive for growth and strategy Vikram Chandra said.

The non-news forays would be undertaken by NDTV Ventures and will have under it the entertainment and new media divisions.

NDTV New Media, in turn, will have NDTV Convergence (Internet initiatives), NGen (media process outsourcing) and NDTV Labs under its umbrella. According to Chandra, NDTV Labs, which would develop in-house broadcast technologies for sale to proposed clients, had already closed its first deal.

Meanwhile, NDTV has announced a 27 per cent growth YOY in revenues for the quarter ending September 30, 2006. The revenues are at Rs.54.5 crore compared to Rs 43 crore in the same quarter of the previous year. NDTV has maintained its revenue leadership in the television news genre. The revenue growth has been strong despite Q2 being seasonally the lean quarter each year for the broadcast television sector.

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