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Subhash Chandra to focus on pay TV

If you ask Subhash Chandra where his Zee media group will grow most in the next couple of years, he has a clear reply: The pay TV business.

The pay market, he says, is estimated at around Rs. 2,000 crore but is growing at 30 per cent, much higher than advertising revenue growth. “We are doing just about Rs. 8 crore. But in three years, we aim to grab at least 30 per cent of the pay business.”

But what about the competition from STAR Network which has already been offering a bouquet of pay channels? “Every time there has been competition, Zee has emerged stronger,” he says. “I do not think STAR will have an edge over us in any of our envisaged business plans.”

Does he worry about Sony TV’s speed of growth? Chandra thinks Zee’s wide portfolio of channels is a distinct advantage. “I do not believe there is any competition between Zee’s bouquet of six channels as of now, to one of Sony or the STAR channel, so far as Indian programmes are concerned. I believe in sales (revenues) realised. I tell my team that a ‘sale’ is that which turns into cash. I am not sure how far the sale of other channels could pass this test.”

Chandra also talked about what he gained by buying out STAR’s stake in the three joint ventures - Asia Today (ATL), SitiCable and Patco. “This is a historic deal where both the seller and the buyer have expressed happiness in equal measure. This also completes the process of consolidation which is already underway in Zee Telefilms (ZTL).” His gain: ZTL will have ATL, SitiCable and Patco as its 100 per cent subsidiaries.

But wouldn’t he have gained more from a STAR-Zee merged entity than a split? Zee has made a mark in the UK, Africa, Middle East and US markets but is not present in Asian countries like China and Japan. There he could have used STAR’s platform to build up a base, even as he plans to add global eyeballs.

But Chandra says, “Platforms are not important. We have made inroads into Africa and the US without having to be on the STAR platform. Music Asia is another initiative of the group which is not on the STAR platform.”

Chandra is looking at foreign strategic partners to obtain value additions in different areas of software skills, good distribution and access to his English channels in the global market. “We are marching into areas of sport, film production, Internet, information technology, education, multiplexes and e-commerce. We want to obtain value additions from strategic alliances and are prepared to give equity up to 10 per cent.”

Chandra says SitiCable will emerge as a “highly valuable media asset” owing to the convergence of technologies. “Exciting things are happening in the global arena. AT&T is going all out to buy the media assets. The acquisition of TCI at upwards of $60 billion followed by Media One, upwards of $40 billion, are pointers in this direction. SitiCable will play a vital role in the convergence phenomena.”

Chandra comes back to the old theory. In media business, you will always be successful if you have quality software. “Content is king,” he says.