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Star India targets $1 billion revenue mark by 2020

28-April-2015
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Star India targets $1 billion revenue mark by 2020

James Murdoch, co-chief operating officer, 21st Century Fox, is looking at an operating income (EBITDA) of $1 billion from Star India by the end of 2020.

The company has been expanding its footprints, both organically and inorganically, especially in sports and regional entertainment content in the country.

"We love the India business. It has now evolved enormously from Hindi entertainment to regional language broadcasting and now we are a national platform. The sports business for us is a new pillar and we are looking at the business in a long term time frame. And if we keep innovating and investing in putting more creative and innovative content on screen, Star India will become a billion dollar EBIDTA by the turn of the decade," Murdoch said at the sixth annual Asia-Pacific video operators summit in Bali on Friday.

Regionalised content creation

According to Star India CEO Uday Shankar, media content has a huge role in shaping the sensibilities of the society and this role should not be underestimated.

"I am prejudiced towards aspirational content and cynical about cynical content. This is something we have always kept in mind while creating all of our content and is the same philosophy that we are bringing to sports as well. Sports has a huge role to play in empowerment, especially in a country like India, where we need to make the society believe that even an uneducated person can aspire to something greater if he is talented in a sport. This is what has worked with Kabaddi in a big way," he said.

"India is a giant country with varied cultures and tastes. We used Asianet as a beach head for the south and elevated the quality of content dramatically with sharper storytelling, involving the best of the creative fraternity and breaking the caste divide between film and TV. For logistic reasons outsourcing production might make sense, but unless you internalize the core creative skill, you will not be able to sustain success, which is why we have build a robust internal creative team to ensure this.

"We have applied the same philosophy that we had in our entertainment business to sports - creating content with deep local affinity using the audience aggregation power that cricket gave you. Sports broadcasting has been plagued by laziness and lack of innovation, treated merely as a distribution agent of acquired rights which is what we have tried to change with multiple local leagues. If its your team that's playing you, even if it is not the best team, you would be deeply passionate about it. Creating a hierarchy of leagues across the country can be huge empowering phenomenon.

Breaking platform barriers

“Our objective behind hotstar was quite simple actually - A lot of audiences were consuming our content on other screens, but we were unhappy with the inability to control their viewing experience. We realised we own all of this IP and so came hotstar. I do not think that this is a "free model". We need to keep the consumer at the center while thinking about this and in a market like India, where data costs are still pretty high, the consumer is still paying a lot for the data - so it's not particularly consumer friendly to have them pay twice, especially at such a nascent stage.

“The reason I'm excited about the OTT space is because it allows for democratization of creativity. However this is not the same as saying that anyone can create content.

“At Star we use a lot of data and we value it deeply, however, let's not become data monkeys. Data helps understands patterns but to understand these patterns and take a leap to what should be created next will still require creativity. No matter how much data we have, I don't believe we will be able to automate the definition of the next blockbuster,” he said.

Innovation spree

Lack of innovation stifling sports business economics, said Sanjay Gupta, chief operating officer at Star India.

“When there's a big sporting event, people congregate to watch in huge numbers, the only question is there enough of these happening and how much innovation has been happening. Better engagement in sports will drive greater consumption. People don't look happy when they win a sports bid.

“We need to have a long term commitment to build a sport, a 10 to 20 years approach to build it ground up. Take the example of EPL which has been around for decades and has built an extremely strong consumer franchise, which advertisers are eager to associate with

“3 year view of buying sporting rights has to change. This current regime disallows most of the partners to make money and disincentives anyone trying to build a sport,” he said.
 

Tags James Murdoch Uday Shankar Sanjay Gupta

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