Category Archives: Media

A league extraordinaire…..

It’s never over till its over!

With little over a decade under its belt it is of recent vintage. However ever since its launch in April/May 2008, it has captured the imagination of all the cricket crazy populations not only in India but across the world. It’s the biggest cricket league in the world, perhaps the richest and has developed itself a brand pull which any brand finds it hard to ignore. It’s the IPL, the Indian Premier League, and the launch of its 12th edition earlier this month brought a round of welcome cheer in this Covid induced comatose in the populations across the world specially in India. Being held in UAE, without the voiceferous crowds, and other restrictions but welcomed nonetheless by all starved of competitive sport for the last seven months. Admit I like cricket and that India is a cricket crazy nation, but still its current edition launch came as a breadth of fresh hope for millions amidst the anxiousness witnessed over the last few months. Lure and the fable continues to get stronger and one wonders .. what makes it tick?

Brainchild of Mr Lalit Modi and modelled on the English Premier league (EPL), having cricket as its main content, it quickly dominated the imagination of fans in India and around the world. Two months of world class cricket in the 20/20 format, most of the international stars, club loyalty, money power, laced with entertainment made IPL the ‘happening’ league across the world and numero uno in India. It’s also the hottest TV property with ever increasing TVC ratings every year, TV being its largest contributor in terms of revenue besides tickets and now digital as well as other ancillary income. It’s a go to property for any brand launch, ask OPPO. Vodaphone, Havell’s, car brands and now digital brands like Byju’s as well as Dream 11. It has made money for BCCI, the club owners, the players and provided Indian cricket with a match ready bench strength incomparable in the world. Virtually every cricket playing nation now has a 20/20 league of its own but IPL still remains gold standard. 12 years of its existence has also seen some downsides like its tryst with match fixing, drug infused parties and betting but the brand has survived and come out stronger!

So what makes it tick… ? The answer lies in the content on offer. If one has witnessed the match on this Sunday between Rajasthan Royal’s and Kings Eleven Punjab and last night beween Mumbai and RCB Bangalore, one would know. Both were high scoring matches but with twists exemplifying the unwritten rule that cricket is by chance and it is never over till it is over. Sunday match saw a relatively new player arrive at the crease, nervous, overawed, and waste almost 20 deliveries in trying to get an impossible ask of almost a 100 runs in the 6 overs remaining. When we thought all was lost…. Rahul Tewatia, the player unleashes 5 sixes in one over scoring 53 in 30 balls in the impossible win! He set the TV audiences and the Twitter on fire and became an overnight star. Yesterday Mumbai came back from behind to score 89 runs in 30 deliveries to level the score, though they eventually lost. Where would you be if you were watching these matches ….. at the edge! Audiences across the world were too with pandemic receding to background recesses of the mind.

The brand IPL has shown resilience, a right offering at the right time. In today’s depressive induced thinking and insipid news and other TV content, this league is manna from heaven. Inspite of not having live viewing possible this year, its tv as well as digital audiences will far overshoot expectations. Already looking forward to the next match today and really does not matter who is playing as all teams are well balanced. Will just enjoy the spectacle!

Take care and stay safe.

Creative excellence is the soul of the business of Entertainment…

Creation is the soul of good content

Business of Entertainment and Media attracts a lot of eyeballs, in fact more than its due share and that is the reason it front ends in current times in marketing some of the other business endeavours. It may not be financially the most prudent or efficient and yet it carries an overweight in terms of eyeballs. What is the enduring lure over generations and what makes it so popular? Content of course as we all know is at the heart of this business and we talk of this every time we discuss entertainment. Content is not something that is availiable off the shelf, whether it be written, spoken, on the video or integrated into a story. It has to be created and that creation involves ideas, writing, direction, photographic skills, story telling and presentation skills which then allow it to become a whole. This is true of content of any kind, whether it is live action, written content, a podcast, video or filmed content.This is the edifice on which the whole business of Entertainment stands. Some say distribution is also key and while I agree but its the basic content which has to be there first to distribute. We sometimes pay significant attention to the distribution and economics ignoring the other factors. It is in fact the excellence of the creative team which is key, as its creative vision is the soul of the content which as we know is at the heart of this business. How does one put a value to this creative excellence?

It’s clearly a very difficult task to discover value in a creative endeavour. It’s not a simple calculation of time and costs like any other input for the real value in this case lies in the eyes of the beholder which is the public or the audience. Also what pulls in the audience is also unclear. Is it the star cast, is it the story or the photography or the combination of all? Audience polls in recent times have been employed as indicators of audience acceptance but how reliable are they is again unclear. Besides these actions, putting a value to the artistic or creative endeavour is difficult. A good creative endeavour not only generates money but also can turn ordinary mortals into stars overnight. How does one put a value to that? That is one of the reason why economics of any entertainment enterprise is fraught with risk. Therefore we can have a windfall or we can be in depth of a deep crevice based on how we assess and price our content. India makes 1000 plus movies every year besides other video content and yet what is the success ratio? Very little despite the experience!

We probably are never going to be able to judge a true worth of a piece of content or for that matter a piece of creative art.For all the art conossieurs, this is a known fact through many centuries and should be true for other areas of artistic or creative excellence. There is always going to be an element of luck or probability as part of this process and if one is to be in this business then one needs to recognise the same. All good content may not be a success and all bad content is not necessarily unsuccessful. Though one thing is for certain, more investment as well as appreciation needs to go into the creative endeavours. Besides the stars, more incentive needs to be built for writers, directors, technicians who are the real part of a creative vision which is the soul of the entertainment business!!

Entertainment business has never been easy but always enjoyable. As one enjoys one’s next instalment, appreciate the creative rigour that goes behind it and if one does that, this article would have served its intent. Have a lovely weekend and stay safe!

Change is the only Constant……

Change is the second name for life and one needs to endure and accept it as a rule rather than an exception. However nobody could have anticipated a change that we are currently seeing due to Covid 19 challenge. This is true for every facet of life as we have known and the Entertainment & Media is not different , in fact more accentuated than some of the other business sectors. Move towards Digital and video is the change and while this move was already apparent before this lockdown, the resultant pace has quickened manifold. The areas which have really started to pose existential questions is the ticketed live events, theatrical distribution of movies and the print business. Print business has been in decline the world over though India, because of regional languages and rural penetration, it was still showing a single digit growth which may now have premature decline should the lockdowns continue for sometime. Let’s go a little deeper into the discussion on the theatrical distribution of filmed content which is hot topic of discussion the world over including India and then look at the ticketed Live events.

Filmed content since time immemorial has been characterised by theatrical distribution of the same. There is certain mystique of larger than life characterisations which can best be enjoyed in a theatre setting with large curved 70mm screens, Dolby sound and 3D effects. It gives the actors larger than life personas making them stars enjoying a fan following either local or international not rivalled by any other video medium. Theatrical exhibition is unique combination of prime real estate, good content and in house dining which has been the defacto standard for long. The current pandemic has hit hard. With real perceived threat of being conduits of infection either through close contact, the air one breathes in air conditioned places, they were the first to be shut down and they still remain closed. Filmed entertainment suddenly found itself without an exhibition vehicle with some digital alternatives but not equal to the style, panache and the financial feasibility of a theatrical release. The lockdown and the pandemic will ease with time and a vaccine sometime in the future but will the theatrical business come back to its preeminent place in the chain, may not be a certainty, specially with fear still pervading the consumers mind. The ticketed live theatre and live events whether sports, music or other content are affected similarly as the theatrical films business. Risk of infection, fear surrounding the same and the fact that the facilities are closed is likely to change this business, the question remains for how long and whether there are any alternatives.

If one were to look at the precedence,the current disruption and the crystal ball, the following facts become apparent –

1. The theatrical business is still the vehicle that defines enjoyment of content whether it is a film or a music concert or a sporting event. The core is watching the content live, with people as well as friends which may not be replicable with any other mode at present. The experience of watching a movie made on a grand scale needs to be in the theatres equipped to give you that experience with real life like effects and sound systems. Pandemic has put a temperory stop to that experience but unless the same is incurable for a long time, the same will be back bigger and better as soon as the things stabilise. The question should be how does one survive till the pandemic goes away and not whether it will be there in the future or not. Costs of real estate, the cost of the workforce should be the topics to worry on for the theatre owners while the money riding on the content made for this medium and its currency should be content owners worry.

2. While the theatrical release is life blood for a movie content and other live content, the cost of putting up new theatres/screens with access had become a drain even before the pandemic. India has been stuck with around 10000 screens for a while now with new screens not being added in adequate numbers. Digital distribution of content, though not the epitome of grandness has made significant strides in making that content accessible in every home and on every screen big or small. It has been an additional revenue generating platform though not the primary one. With its ever increasing technological features, artificial intelligence and global coverage it slowly has gained precedence. Netflix , is today a highly valued digital OTT platform which is dominating attention of all the large players having bested the capabilies of the traditional TV platforms both as a distributor and producer of content across geographies. Regardless of what our feelings are about the theatrical distribution,digital distribution of movies is an event whose time has come. It may not be apparent for the live theatre or the events but they may not be far behind. It’s possible that these systems will exist side by side but it is starting to happen and will get mainstream with time.

3. Two other changes again which have been on the anvil will now accelerate. The first change will be the merging of the two distribution systems with both theatres and the digital channels releasing content simultaneously or with reduced intervals. It’s already happening in the US with one of the large theatre chain AMC having reached agreement with the digital side for reducing the interval to 17 days from 70. The second change is the rapid rise of tech behemoths first as providers of technology and now slowly as producers and distributors of content. The real change is the strength of their balance sheets and the inexhaustible ability to spend on content. They are the new entertainment moguls and with this disruption, there is all likelihood that it will happen much sooner than expected.

4. While the digital systems still are not completely transparent on the profitability, probably because profitability is not a criteria but domination of market and subscribers is. I believe that here too change will happen and soon. We are already seeing the pay per view models emerging with one having been launched in India by Shemaroo. There will be more

Change has been the only constant and it’s time to realise that the world has changed. Time to change our thinking and actions too to welcome the new world.

Content, yes but economics?

Content is no doubt the key to hold the audience attention. The demand for video content with the proliferation of TV, OTT and other platforms vying for consumer connect is set to boom. Therefore and rightly so access to content is key to any successful venture in the Entertainment and Media space.

The expansion in the content marketplace has not only led to new content producers but also significantly added to the quality of content that would be availiable. Platform players while they would be happy with more productions will also have to contend with higher cost. Producing content both for web series, short movies and movies for OTT is vastly different from the massy advertisement led content produced for TV at least in India. Therefore the content costs have risen or are set to rise exponentially over the next few years. Without the comfort of advertisement and the level of subscriptions low and not growing in tandem, is the industry in danger of outspending itself into oblivion?? Problem is very real with only a likelihood of a few winners and many losers.

The Producers on the other side are likely to multiply as they sense a lucrative opportunity over the next few years. With platforms like Netflix , Apple,Amazon, Hotstar , MX2, budgeting huge amounts for acquisition of content it’s clearly boom time.

However Indian content houses have typically done TV content on a cost plus basis and that too massy as well as not of particularly high quality. To improve and deliver in the new world will require origination skills besides pure production not to mention the ability to sell. Much of the value for content lies in their IPR’s which presently are not retained by the content producers. They will need to keep that in mind if they are to create wealth for their stakeholders.

Will be interesting to observe how the business models develop. However both the platforms and the content producers will have to work at the ‘Economics‘ to create value!

Where is the growth going to come from?

growthThere are two key generators of revenue for the E&M industry i.e. the Advertisement-spend and the second being the Consumer-spend.  The Advertisement-spend is approximately 35% of the total revenue of E&M Industry, which accrues to sectors like print, radio, TV, out-of-home media and internet to some extent. On the other hand Consumer-spend comes mainly in the form of cable subscription, internet subscription as well as ticketing revenues for films.

For India to get extraordinary growth one will have to think of expanding both of the key elements substantially. The assumption of 17-18% growth in the next seven years already takes into account most of the growth drivers like expansion on categories, better targeting, new channels, new screens, all are part of the strategy which has been considered. Where then are we likely to get growth, which presently is not envisioned?

In addition to this, the question is also of falling GDP growth, which is negatively impacting Advertisement growth in the country. Advertisement growth which was till last year envisioned to grow at around 12% on an average has taken a downturn and would perhaps grow lower than the GDP if the trends remain negative. Consumer spend too is affected though the silver lining in the current period is that the subscription fee will be better largely due to the success of the ongoing digitization process on the distribution side.  This would be largely revenue which will come under the accountable fold and hence be available for sharing to content providers & broadcasters. However, this may not mean an expansion of the market in real terms.

Then where do we look for the forecasted growth as well as the extra growth that the industry is looking for?

The macro factors will play their part and it may not be within industry’s capability to control them. Thus, what the industry can do is to do better with the elements it has in-hand. There is a widely held belief in the E&M Industry worldwide, which is relevant for India, that ‘Content’ is King and ‘Distribution’ is God. I believe that there is merit in looking at both of these concepts very closely for a likely solution not only to get growth but also for sustainable growth.

If we look at the content in India today, whatever is produced is produced for Indian audiences in India or abroad. There definitely needs to be a disruptive thought process to improve content that will appeal to worldwide audiences. Larger reach with different delivery formats will bring larger budgets as well as significantly disproportionate increase in revenue. What will also be significant will be the measure that will improve the monetization of that content across markets over a period of time. This can happen through rational IPR policies and their strict application.

Lets stay with ‘Content’ for the time being and explore ways where we can produce and monetize content to achieve the abovementioned.

More on that in the next installment… 

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Hi, Welcome to my blog!


Entertainment & Media industry with revenue of USD 17 billion has always been in the news, whether it is for the glamour quotient, myriad controversies, its growth in the past or the future potential of the same. Although, there are enough forums and tabloids that cover the glamour as well as the controversy part of this huge industry, not much has been written about the growth and the future aspects of the same.

Through this blog, my endeavour is to provide a two-way platform to discuss the future growth potential as well as the business model of an industry that is in the throes of a big change worldwide. The other reason for this blog is more personal as I want to remain connected with an industry sector where I have worked very closely with the constituents in the past seven years as head of the PwC Entertainment & Media team in India. After an early retirement from PwC earlier this year, I have started my firm Sapphire Professional Services. This blog will hopefully keep me connected and become a platform for discussion on the future of the Industry.

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Fortunately, with the kind of change taking place throughout the world with digital becoming the new normal, myriad of different businesses under the E&M umbrella growing differently, we probably will have no dearth of discussion topics in the short-term. However, to kick-start the conversation let us look at the future growth potential of the E&M Industry in India in general. This was also the subject of discussion at a recent industry event held in the capital with most of the industry captains and the Government in attendance.

We in India, for the past few years have got accustomed to seeing double-digit growth in most of the sectors and anything less is not exciting enough or lets say not news-worthy. Maybe this reaction is because it feels good to be on top of the table of the parameter that is most searched for at that moment even if you perform very poorly in most of the other parameters.  Therefore, despite having a growth of almost 17-18 % (we are the highest in the world), there is a thought process that India is not growing at its full potential in the E&M sector. USD 100 billion in 2020 is what many believe and estimate that the industry should grow to. Can this be achieved? Where is the growth going to come from? Do we know all the variables? Probably not. Can we add to the confusion? Yes, we can.
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To start the discussion, I would like to put forth my thought process on a macro level and share it with you. The India E&M Industry as per recently released PwC report is a USD 17 billion revenue industry.  In India this industry is largely driven by non-digital elements unlike elsewhere in the world where digital streams are showing the highest growth rate. Again, quoting from the PwC report, this sector is likely to grow at a CAGR of 17-18 % over the next five years making the industry more than double its present size at USD 38 billion in the year 2016. If one was to take the linear progression and assume that the industry will continue to grow at the same rate up to 2020, the industry size will be approx. USD 70 billion. Therefore, it seems that India will have to do a few things very differently to achieve an additional USD 30 billion. Few facts need to be kept in mind as we look to suggest solution for the extra growth: –

  • The current revenue of the industry is largely from non-digital platforms as TV, Print and Film account for almost 85% of the industry.

  • Shift from non-digital to digital could decrease the value in the short-term.

  • Advertising spend and Consumer spend are the two key contributors to the revenue with advertising contributing at over 35% of the total revenue pie.

Before I put forth my views on finding a way to the extra growth, I would like to welcome thoughts from you. Whether any other thoughts need to be kept in mind and what we should be doing differently?  Please log your comments below, as then hopefully a discussion can develop.

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