Editorial

Eye on the 500cr pie
AUDACITY. Yes, that’s what it takes to run a satellite channel down South, these days. Almost all the leading players in the fray are now gearing up for bigger slices of the ad revenue pie. Some even have eyes set on a goldmine in convergence, a fortune they reckon, that’s waiting to be tapped.

Caution, anyone? Well, now that the ambitious plans have been drawn up, that’s the last thing anyone has time for right now. The details:

In 1999-2000, the combined ad revenues of all Southie channels put together was a modest Rs 500 crore -- a mere 20 per cent of the national figure. The Sun Network, comprising regional channels in each of the four states ate up half the pie, cornering Rs 25o0 crore, with even the once formidable Doordarshan falling way short -- at Rs 100 crore.

This year, Kalanidhi Maran’s Sun TV will have to contend with increasing competition for the 500 crore pie. Subhash Chandra’s Zee group, which has already acquired a controlling 51 per cent stake in Asianet, the Malayalam channel, is planning to launch new regional channels in each of the three other states, obviously, to storm Maran’s bastion.

And that’s not all: Maran’s competitor in Andhra, Ramoji Rao -- his Eenadu group has snagged Rs 60 crore of ad revenue, last year, as against 40 crore by Maran’s Gemini TV -- has plans to launch a new channel in Karnataka. So far, Maran’s has an open field in Kannada, with only the ineffectual DD for competition. His Vijaya TV romped home with over 70 per cent of the Rs 100 crore market in the state.

What’s more, there’s competition brewing in Tamil Nadu, too. UTV’s Tamil channel, Vijay, has had a facelift in recent times, and appears all set to contend for, if not take home more than the negligible Rs 16 crore it did last year, by way of ad revenue.
Maran himself is almost on the verge of launching into overdrive. As if to protect his turf, he will soon launch three new channels. Having just launched Sun News in May, he will now start Udaya News, a 24-hour Kannada-English current affairs channel, in addition to Ushe and Teja, the movie and music channels in Kannada and Telugu.

Come July, Maran will also begin to offer Internet services on broadband to the 0.7 million South Indian homes reached by his SCV Cable Network. Thanks to the high speed net access that this will provide his subscribers with, they can also avail of his video on demand facility on the net. On offer is a low-cost (a throwaway Rs 5000) set top box, that allows him to watch it on his TV. Also on the cards are four FM channels, four multiplexes and a dozen TV studios. And to fund this grand convergence strategy, Maran’s reportedly proposed an entry into the equity market over the next two years, by which he hopes to raise about Rs 2000 crore.

The Sun Network’s strength so far has been the 6000-plus movies, to which it has acquired the satellite, cable and Internet rights. That’s a whopping 70 per cent of the total number of films produced in all four languages down South. Considering that films and film music comprise a major part of programming, Sun has virtually snuffed out the competition on the strength of its unrivalled movie library.

Of course, the likes of Chandra and Rao would love to lay their hands on as many movie titles. But they have strengths that Maran doesn’t -- and that’s just what the competition will hope to exploit. Unlike Zee, which produces the bulk of its own programmes, Sun only sells time slots to the producers, and consequently, does not hold the rights to too many fiction-based programmes, like serials and telefilms.

SHEDDING THE LOW PROFILE
So far, the cautious, low-profile approach has worked well for Maran. Unlike the flamboyant, risk-taking Subhash Chandra, Maran’s been a steady plodder, who believes in consolidating his position in carefully chalked out stages.

Now, with the competition breathing down his neck, even Maran seems to be altering his game plan drastically. Question is, will it work for him? Or, has he changed tack too late? Considering the Zee Telefilms stock has dipped from Rs 1475 in March 2000 to the current Rs 500 or thereabouts, it seems hardly an auspicious time for Sun to consider an IPO launch.

A couple of months ago, when the market was bullish on showbiz stocks, raising Rs 2000 crore may have been a cakewalk. Now, with the jittery market conditions, it does seem a tall order.

Shaju George Alex