Viacom18 to build a strong SVOD platform: Paramount CFO Naveen Chopra
The platform will be created with the recent fundraising announced by the company
Viacom18, the joint venture between India's Reliance Industries and American media conglomerate Paramount Global, is planning to build an SVOD offering with the recent fundraising announced by the company, Paramount Global Chief Financial Officer (CFO) Naveen Chopra told analysts while speaking at the MoffettNathanson Annual Media & Communications Summit.
Viacom18 had last month announced that Bodhi Tree Systems, a platform of Lupa Systems and Uday Shankar, will invest Rs 13,500 crore in the company with Reliance Projects & Property Management Services infusing an additional Rs 1,645 crore.
Chopra further stated that the SVOD offering will be a force to reckon with in the Indian market. He added that Reliance's involvement in the JV will ensure that the SVOD offering has great local content and unrivalled distribution capabilities.
He made these comments while responding to skeptics who believe that it is difficult to generate returns from the streaming business in India.
"Fair enough. That has certainly played into how we've thought about a smarter way to play in that (India) market. We have a JV that we've been a part of actually for several years called Viacom 18 in India. Our partner in that JV is Reliance, which is obviously a hugely influential player in the Indian marketplace. The JV was originally established to help us monetize our linear channels in India, then expanded into AVOD with a service called Voot that I think has over 100 million users at this point," he said while speaking about Paramount Global's approach in the Indian market.
He further added, "And we recently announced that the JV is going to raise a significant amount of incremental capital so that it can start to build out an SVOD offering. And I think that's going to be a very powerful offering in the market. With Reliance's involvement, there will be great local content and unrivalled distribution capabilities. You don't really bet against Reliance in the Indian market. And for us, we're able to participate in that without investing any incremental capital. So for the skeptics, I think it is a very smart way to plan ahead."
Paramount, Chopra said, has a joint venture with Comcast in the UK which is called SkyShowtime. The JV is focused on smaller European markets and will eventually address 20 different European markets which include about 90 million homes. He further stated that the JV is a combination of content from Universal, Paramount, Showtime, Sky, and Nickelodeon.
"And one of the reasons that we entered into that JV is because it allows us to address some of these markets where it doesn't make sense to do so on a pure O&O basis. And the reason it may not make sense to do so is that some of those markets just don't have the scale to generate returns on the investments that are required. In some cases, the economic structure of how content is made available in those markets makes it challenging to invest too aggressively from a streaming perspective, might be the availability of free content over the air or whatever -- every market is a little bit different," Chopra explained.
Citing the example of Viacom18 in India, he also said it is better to have a local partner in markets where it doesn't have the content capabilities.
"And then in some cases, we don't have access to the same local content capabilities that we have in other markets. And in that case, being able to partner with somebody who can help add scale to that is valuable. So we like that model in certain situations. It's not our default model. Our default is that we want to be able to go into these markets where there are no services, but there are markets where it makes sense. Another example of that is actually India. There are a lot of skeptics out there about whether you can actually generate a return on streaming in India," he stated.
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