What's on new Viacom18 CEO's plate? Strengthening regional TV, digital biz, say experts

With the company finally getting a leader on top with the appointment of Jyoti Despande, Viacom18 now looks to move beyond its Hindi GEC and Kids bastions

e4m by Javed Farooqui
Updated: Oct 4, 2021 8:30 AM
Jyoti Despande,

Media veteran Jyoti Deshpande, who has been appointed as CEO of Viacom18, a 51:49 JV between TV18 and ViacomCBS, has her hands full as far as challenges are concerned, say media experts and broadcasting sector executives. The biggest challenge for the new CEO is turning around the regional entertainment business and scaling up the video streaming business of Viacom18.

According to industry sources, Deshpande is not new to Viacom18 and knows the company inside out since she has been associated with the company as a director. “She is not new to Viacom18, as she has always been involved in the affairs of the company, being a director. She has been on the board of Viacom18 since she joined Reliance,” said one of the sources.

In the TV broadcasting pecking order, Viacom18 is the fourth-biggest network in revenue and third largest when it comes to viewership. Star India (Rs 14,337.46 crore in FY20), ZEEL (Rs 7729.9 crore in FY21), and Sony (Rs 5721.6 crore in FY21) are the biggest networks in terms of revenue. Viacom18 had reported revenue of Rs 3286.16 crore in FY21.

In terms of network share, Viacom18 is in the third position with an 11% share (June 2021), as per TV18 presentation for Q1 FY22. ZEEL had reported 17% network share for Q1 FY22. According to market sources, Star India and Sony have 19-20% and 8-9% network share, respectively.

According to senior officials in the industry, Viacom18 is perfectly placed as far as Hindi mass entertainment (Colors, Colors Rishtey) and kids (Nickelodeon, Sonic) businesses are concerned. They add that the network has a lot of catching up to do in the regional markets.

The company's regional business consists of channels like Colors Kannada, Colors Super (second Kannada GEC), Colors Marathi, Colors Gujarati, Colors Odia, Colors Bangla, and Colors Tamil. The network's strategy for regional business is to expand its presence in markets where it is not present as well as deepen its presence in markets where it has established itself as a strong player. The Kannada market is a case in point.

In the last few years, Viacom18 has expanded its presence by entering the Tamil market, besides deepening its presence in the Kannada market by launching a second GEC and a movie channel. It has also launched regional movie channels in Gujarati and Bangla markets. In 2019, Viacom18 had launched a digital-first Telugu GEC Colors Telugu on Voot. At that time, many saw it as a precursor to the network's entry into the country's biggest TV market.

Viacom18 will also have to up the ante in the video streaming segment in the face of aggressive investments by Netflix, Amazon Prime Video, Disney+ Hotstar, SonyLIV and ZEE5. WarnerMedia is also expected to make a big-bang entry into the Indian market with HBO Max. Viacom18 owns three streaming platforms Voot (AVOD), Voot Kids (SVOD), and Voot Select (SVOD).

According to a top media executive, the new Viacom18 CEO will have to fix the regional entertainment business besides strengthening the digital portfolio considering the growing competition in the OTT market. The network is also foraying into the sports business, with Viacom18 CEO — Sports Anil Jayaraj driving it.

“There are lots of challenges in the company. There is a foray into sports which will be driven by Anil Jayaraj. Then there is this whole piece about digital where it stands today in comparison to other competitors. Then there is the challenge of regional channels not doing well. Except for Hindi GEC and kids, there are lots of challenges for the company. The regional entertainment business is the biggest challenge for the company. If you are not number 1 in any regional market, then it is a problem. Being number 3 or 4 in some markets is also a challenge. Apart from regional, digital has to be a big focus area,” the executive said on condition of anonymity.

According to a media industry expert, Jyoti Deshpande's appointment will ensure that Viacom18 has a leader at the top, as the company was operating without a full-time CEO for some time. “She is the best person to come in as the CEO, having to be part of the Reliance system for three years. She is an insider as she has also been on the board of Viacom18. With two back to back appointments, Viacom18's structure is finally falling into place. They have entertainment, and now they are getting into sports. They also have two separate leaders to take these businesses forward,” the expert said.

He also said that the key focus areas for Viacom18 leadership would be strengthening the entertainment business and setting up the sports business. “If regional entertainment starts firing, then they will be in a good zone. Likewise, if they get a grip on sports, they will be in a strong position. Voot will become a strong OTT platform if Viacom18 manages to win IPL media rights,” he averred.

A senior executive with a rival broadcasting company said that Jyoti Deshpande has been looking after content for Viacom18 by virtue of being President — Media Platform & Content at Reliance. He also noted that Viacom18 has been a strong player in the TV broadcasting, however, it has a lot of catching up to do.

“She was already on the board of Viacom18 as a director. Now, she is firmly in the driver's seat. Viacom18 is a key player in the market with 10-11% share of the market. It comes at number 3 as a network after Star and Zee. Viacom18 has a strong presence in GEC, kids and youth categories. However, kids and youth genres are not big from an ad market size point of view. They need to focus on building their regional business because that's where the big money is. Apart from regional, sports might turn out to be a game-changer for the company,” the executive added.

A media industry watcher noted that the appointment of Jyoti Deshpande and Anil Jayaraj comes at a time when the Zee-Sony merger is happening and important cricket rights are coming for renewal including the big IPL media rights auctions which will see strong interest from Reliance, Star, Sony, and Amazon.

“If you notice, last time when the IPL media rights came up for renewal, we saw Sony acquiring Ten Sports from Zee. Basically, the acquisition was Sony's way of trying to hedge against the risk of losing IPL or getting it at a costly price. This time, we have Zee and Sony coming together. Sony will also be making a huge fund infusion into the merged company. It will be interesting to see how those funds are utilised. Viacom18 is also aggressively looking at sports. Strategically, owning cricket rights is very important in terms of growing revenues. IPL will decide the future pecking order of the broadcasting business. In the past, acquisition of IPL media rights had propelled Star and Sony to greater heights,” the source said.

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