It’s Time to Focus, and Achieve $100 billion Target big pic nov newsletter.pdf · ullar,...

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Newsletter from the CII Media & Entertainment DivisionNOVEMBER 2012

The Big Picture Behind Indian M&EWe welcome Manish Tewari, the new Information & Broadcasting Minister and are thankful to him for coming to the Big Picture Summit on the fi rst day after taking charge and meet the Indian Media & Entertainment leaders.

CII’s two-day India The Big Picture Summit is still top in the mind of our media and entertainment business lead-ers. We brought together the best of the creative and business minds to chalk out a roadmap that would take our M&E sector to $100 billion. The government, regulator, academia and civil society joined the discussion to suggest new ways to add up revenues and growth in this sector.

The Big Picture Summit has infused a new breath of life to this sector whose soft power can bring innumerable benefi ts to the Indian economy. It has brought a fresh mindset to leap forward in this sector. Actually, there are clear signals that the industry is moving from gear two to gear three in car driv-ing parlance.

CII’s vision is to create growth tem-plates in all M&E verticals and bring the industry together and speak in a united voice for all major issues.

We thank Amit Khanna, Chairman, CII National M&E Committee, Shabana Azmi, Co-Chair, CII National M&E Com-mittee, Uday Shankar, CEO, Star India and members of the CII Media & Enter-tainment Committee for their contribu-tion to the success of this summit.

Send your views to our media and entertainment division head: [email protected]

Top decision makers of all major media and entertainment verticals did a reality check for two days on creating roadmap for a $100 billion Indian M&E industry.

The summit provided a clarity of vision and a confi dence that Indian M&E indus-try can aim to achieve fi ve fold from what we it is now.

“If we have to be competitive and get to a $100 billion M&E sector, we have to build scale,’’ said Uday Shankar, CEO, Star India

at India-- The Big Picture Summit.

“Scale brings with it not only value but also greater reach. One place to look for scale is to gaze outside India. Our friends in the pharma sector have shown how this possible: 50 per cent of the pharma sector revenues come from outside of India,’’ said Uday Shankar in his keynote address.

The industry felt that for the long term growth of the industry, business model should undergo a drastic change.

The $100 billion is not an impossible target. We are at an infl ection point towards an accelerated growth. We have the

potential to put this sector to a higher growth trajectory. Let’s look forward with hope, confi dence with a feet onground. As we move towards a networked (digital) society more

and more niches emerge in the media and entertainment universe. I am very optimistic to achieve this goal

Amit Khanna, Chairman, CII National M&E Committee

POLICY NOTES

CII BIG PICTURE SUMMIT

It’s Time to Focus, and Achieve $100 billion Target

CHANDRAJIT BANERJEEDirector General, CII

Newsletter from the CII Media & Entertainment Division

Uday Kumar Varma, I&B Secretary Manish Tewari, I&B Minister, Chandrajit Banerjee, CII Director General, Amit Khanna, Chairman CII National M&E Committee and Uday Shankar, CEO Star India at the Big Picture Summit

K K Laskar

2 Newsletter from the CII Media & Entertainment Division

Roadmap for FutureThe two-day India- Big Picture Summit brought together the best of the creative and business minds to do a reality check and chalk out a roadmap for the future. Here are images from the Summit.


Shekhar Kapur, Shyam Benegal, Shabana Azmi at the session on 100 years of Indian cinema Olympic medalist Mary Kom delighted everyone at the CII Big Picture Summit

Star India CEO Uday Shankar, SET CEO Man Jit Singh and CII DG Chandrajit Banerjee Mark of respect for Yash Chopra

BJP leader Arun Jaitely sharing a word with M&E leaders

Vidya Balan at the Big Picture Summit Javed Akhtar, Vipul Shah and Uday Shankar

Eros International Group CEO Jyothi Deshpande, Reliance Entertainment CEO Sanjeev Lamba, Sudhir Mishra and Anil Kapoor

Attentive audience at the Big Picture Summit Amit Khanna, Uday Shankar and Ronnie ScrewvalaI&B Secretary Uday Kumar Varma and SET CEO Man Jit Singh

3Newsletter from the CII Media & Entertainment Division

The Information and Broadcasting (I&B) Min-istry is actively consider-ing steps to make India a teleport hub enabling the country to become an up-linking/downlinking

centre like Hong Kong and Singapore.

Addressing industry leaders at the Big

Picture Summit, Uday Kumar Varma, Sec-retary, I&B Ministry said that India becom-ing a teleport hub could be instrumental in attracting accelerated fl ow of foreign direct investment (FDI) as also state-of-the-art technology and can help move up in the value chain in content generation.

Varma assured that the auction process for FM Phase III in radio aimed at adding

another 839 stations in over 290 towns and cities and would commence by the end of the current fi nancial year.

Referring to the centenary of Indian cinema, Varma invited the doyens of the Indian fi lm industry to join the tableaux to be presented at the Republic Day Parade 2013 in New Delhi on this subject, by walk-ing down Rajpath on January 26.

Govt Gears up to Make India Teleport hubAuction process for FM Phase III in radio before this fi nancial year


Central Board of Film Cer-tifi cation (CBFC) chairper-son Leela Samson said that the board neither makes guidelines nor fi lms, but still they are at the receiving end from both fi lmmakers and the government.

Speaking at the Big Picture Summit, she said, “There is lot of speculation regarding CBFC`s ideology and motives in the fi lm industry. This has of course been fueled by vested interests and short-

sightedness.

Samson said, while the fi lmmakers have the power to make fi lms, the government has the power to ban it without even consulting anyone.

“As happened in smoking ban. It was not even done by the ministry of information and broadcasting. It was done by ministry of health. They

(health ministry) did it with-out consulting anybody but the execution of it was left to CBFC,” she said.

“We take the fl ak of decisions taken by both the govern-ment and the fi lmmakers. This is the most liberal board that we have had and it remains committed towards a positive approach to fi lm certifi cation with minimum interference in creative free-dom,” she added.

Dr Rahul Kh-ullar, Chair-man, Telecom Regulatory Authority of India (TRAI), has stressed

the need for having a sepa-rate regulator for content instead of having it moni-tored by different institu-tions, which leads to a lot of confusion.

Speaking at the Session on

Policy Conundrum, Khullar said that all stakeholders in the media should come together to sort out the prob-lems before coming to the regulator.

Responding to a query from the fl oor that documentary segment was by and large ig-nored by the government and incentives should be extend to this fragile segment, Dr Khul-lar said that it was a matter of policy and the aggrieved

should approach the govern-ment and not the regulator.

Regarding pricing of content, which a section complaint was heavily lauded against them, he said that once the carriage issue was being sort-ed out, pricing also could be resolved. However, he pointed out that it would be better the industry sort out the issue on their own and leave the regulator for sorting out other vexatious issues.

CBFC is Liberal

Need for Content Regulator

FROM THE HEART

TRAI TALK

UDAY KUMAR VARMASecretary, I&B

LEELA SAMSONChairperson, CBFC

DR RAHUL KHULLARChairman, TRAI

Taking Technology to All

The government is taking proactive steps to enhance the broadband penetration in the country from 20 million to 600 mil-lion by 2020 so as to cover the entire

breadth and length of the country.Addressing media leaders at the Big Picture Summit, R Chan-drasekhar, Secretary, Informa-tion Technology and Chairman Telecom Commission, said that the government was investing Rs 20,000 crore over the next few years for strengthening the broadband network in the country. Chandrasekhar opined that the digital space would undergo a radi-cal change and the spin-offs to the common man would be substantial in terms of toning up health servic-es, education, and entertainment. Also, availing the cost of such services would be much reduced on account of convergence.There will be emergence of dif-ferent type of new services. The phenomenal growth of digitization in tier 3 and tier 4 for towns ampli-fi es the potential of the digital landscape that can encompass the whole of India.Chandrasekhar pointed out some of the concerns in the digital space have to be addressed at the earliest.

R CHANDRASEKHARSecretary, Information Technology and Chairman Telecom Commission

BROADBAND ECONOMY


CII BIG PICTURE VOICES

YES, I DID SAY THATTaking Indian M&E industry to touch $100 billion mark, digitization, freedom of expression, media and society, censorship and cinema dominated discussions at the CII organised India -- The Big Picture Summit. Here are straight voices from industry leaders

We are at an infl ection point towards an accelerated growth and aim for a $100 billion Indian M&E industry by 2020. We have the potential to put this sector to a higher growth trajectory

Amit KhannaChairman, CII National M&E CommitteeChairman, Reliance Entertainment

We can take Indian M&E sector to $100 billion. It is achievable. I have no doubt in my mind that this is something that we should rightfully aspire for -- why cannot a country with over a billion people aspire for this?

Uday ShankarCEO, Star India

Indian Broadcasting and fi lms need to be a B2C business. The big challenge is how do we take this to a true B2C business? How do we make 200 million people to pay Rs 1500 a month to consume entertainment?

Ronnie ScrewvalaManaging Director, Walt Disney India

At a time when we are celebrating 100 years of cinema, this is a good time to revisit what our identity is, how is it poised to face the international market and where exactly we should go

Shabana AzmiCo-Chair, CII National M&E Committee

Addressing press conference in a structured manner at times is a nightmare. I have now adopted a more safer option to write down the views and put it on the Internet and let the media pick from there

Arun JaitelyLeader of the Opposition, Rajya Sabha

Indian TV advertising as against GDP is 0.48 per cent. When per capita spending touches $800, television spending doubles overnight and it is expected to happen in India’s next plan period

Man Jit SinghCEO, Sony Entertainment Television

The $100 billion dream for Indian M&E sector is not outrageous. It is very refreshing and I am confi dent we can achieve this

Mahesh BhattFilmmaker

The recent regulatory changes in India on broadcast digitization will benefi t consumers and the business. The biggest game changer from digitization will be greater transparency and accountability

Andy KaplanPresident, Worldwide Network, Sony Picture Television

Society has ideas and thoughts that turns them into good cinema and great images. Today, society is not sending us any messages. Whenever society gave a message, Indian cinema turn that into an icon and gave a more fo-cused picture back to the society. We are not receiving any messages. Time has come for the society to do some introspection and re-vive the communication that is broken

Javed AkhtarLyricist & Member of Parliament (Rajya Sabha)


To reach $100 billion target, the industry needs to recognise three things: advertisers need to recognise that as audiences have grown, and rates also need to grow; the broadcasters need to get rid of carriage fees; and the broadcasters need to fi nd alternate sources of revenue

Narayan RaoExecutive Vice-Chairperson, NDTV

There are so many talented fi lmmakers, who are waiting to be noticed but unfortunately there is no one to back their project fi nancially

Ramesh SippyChairperson, NFDC

There is no freedom of expression in cinema, which is a powerful medium for social change. Freedom of expression in cinema is critical for the success of the democracy. I really hope and pray that we develop, we evolve and become a true democracy and we can really express freely

Prakash JhaFilmmaker

The fact that one is frus-trated now is a positive sign. Because to me what signals is one can do more. That is what I like about $100 billion. It is not an unambitious target. The right regula-tion alone unleashes certain amount of value in the industry. There is a lot of room in the runway for growth in the M&E sector

Bharat N AnandProfessor of Business AdministrationHarvard Business School

In B2B, you will fi nd people seek effi ciency and beat down each other on costs. B2C is far more liberating model when it comes to effectiveness and innovation and therefore ability to give right thing to the focused segment and charge for it

Sudhanshu VatsCEO, Viacom 18 Media Pvt Ltd

Advertisers will always pay for audiences and GRPs. If you want to monetize content that has to come from B2C models or from the viewers. Content is for the viewer. Advertising time is for the advertiser

Sam BalsaraChairman & Managing Director Madison Communications

Digitization is a defi ning moment. This is what is going to change the media. In the US, when digitization happened the channels moved from 500 to 2000 including all local channels. I would feel, in India, we would go from 500 to 3000 channels. We are in the cusp of that change. This would change, if regulation allows free pricing

Sameer ManchandaChairman & MD, DEN Networks Ltd

Taxation in the DTH sector is a big problem. Content is being made available to the customer at the lowest possible price. Despite that minimal amount, we are the high-est taxed industry in the country. We pay about 32-35 per cent tax. Apart from the import fees on the STBs, there is 10 per cent license cost. Apart from this, there is service charge that comes into play

Harit NagpalMD & CEO Tata Sky

If a fi lm is free speech, then is censorship tenable? Why is sex deemed as adult content when violence isn’t? We need a revamp of the guideline

Sudhir MishraFilmmaker

The Cinematograph Act is of 1952, but we are now living in a different world altogether. The Act needs to be changed to suit modern times. Also, fi lmmakers need to know what is the yard-stick for fi lm ratings

Mukesh BhattPresident Film & TV Producers Guild of India

Media has been a great force in the Indian society. The journalists today are being ‘out-journalisted’ by people and therefore, it’s essential for journalists to gather domain expertise and roll-out valuable information

Aroon PurieChairman & Editor-in-Chief, India Today Group

The consumers should not get a feeling that it is their birthright to continue to get content free. Micro transaction platforms will be key to India growth in our digital economy when our Internet subscribers go up from 140 million to 400 million

Neeraj RoyMD, Hungama Digital Entertainment


CII CEOs ROUNDTABLE

ON RADIO

For RegistrationEmail: [email protected]: 011 - 45771053

Knowledge Partner: Ernst & Young

Session I

Challenges

of Phase III

Radio

Reforms

Session II

Power of

Radio

Advertising

Date: December 2012

Venue: Hotel Le Meridien, New Delhi

Release of CII –

Ernst & Young

Radio Report


Digitisation of media delivery mechanisms

Digitisation of cable networks will help de-liver high quality content to Indian view-ers and also reduce the incidence of value leakage from the industry. Further, the number of channels delivered to consum-ers will increase manifold. This, coupled with the addressability enabled by digital cable networks, will signifi cantly boost advertising revenues. Digitisation will also help drive the uptake of HD channels and value-added-services such as pay-per-view (e.g., movies), thereby encouraging higher consumer spend.

Improved audience measurement systems

To attract more advertisers and get exist-ing advertisers to spend more on various media, it is important that audience mea-surement systems are made more robust and representative. This is especially required for TV channels, newspapers and magazines that are regional or niche in nature and therefore, may not register signifi cant viewership numbers in the existing measurement systems. Even OOH needs improved, sophisticated measure-ment systems that will not only reinforce the faith of existing advertisers but also

attract new advertisers to the medium.

It is important for industry players to col-laborate and invest in effective systems (or support third-party players investing in such systems) that will generate statistical-ly signifi cant and representative audience measurement numbers with a high degree of detail. This will enable advertisers to better assess the effectiveness of their media spend, ultimately driving growth in advertising budgets.

Driving high broadband penetration

India lags behind in terms of internet subscribers. To a large extent, this is due to inadequate wire-line infrastructure in the country. To boost internet access and advertising, it is important that broadband penetration and usage in the country increases manifold. Widespread broadband roll-out will also enable consumption of content anywhere and on any device. This will open up incremental revenue streams for content owners.

In view of the defi cient copper PSTN net-work, it is important to provide incentives to operators using fi xed-line technologies such as cable internet or broadband (there are ~80 million cable households) and wireless technologies such as 3G and BWA to boost uptake of broadband. In fact, mo-

bile broadband is also expected to drive the usage of content services such as music, video and games.

Regulatory and policy support

This is a critical driver for industry growth and signifi cant initiatives have al-ready been undertaken by the government in the last few years. This includes focus on mandatory digitisation for television and further liberalisation of the sector in terms of foreign investment limits. How-ever, it is important that regulatory clarity and transparency continues and suitable focus is placed in implementing the an-nounced policies (e.g. meeting timelines for the digitisation process), to achieve the potential of a 100 billion USD sector.

CII-PwC REPORT

Mission PossibleAchieving the vision of an industry to reach $ 100 billion will require a focused approach towards developing and deploying relevant infrastructure, supported by a strong policy framework, says the new CII-PwC report on the Indian M&E Industry

I&B Minister Manish Tewari releasing the CII-PwC M&E Report

To boost internet access and advertising, it is

important that broadband penetration

and usage in the country increases manifold

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BY THE NUMBERS – UDAY SHANKAR, CEO STAR INDIA


The sheer scale of a $100 billion can generate over $5 billion in taxes (as-sumption: 15% EBITA; 30% tax rate). Let us look at what that means: it is more than half the current allocation for NREGA ($8 billion). The Govern-ment has passed the Right to Education act and as part of that, efforts on Sarva Siksha Abhayan have been scaled up. At $100 billion our tax revenues would have been able to fund the entire budget of Sarva Siksha Abhayan ($5 billion) or the National Rural Health Mission ($6 billion).

Newsletter from the CII Media & Entertainment Division

Manish Tewari at CII’s India The Big Picture Summit on the day he took over as the I&B Minister on October 29

Manish Tewari releasing the M&E law book brought out by Naik and Naik

CBFC Chairperson Leela Samson with Manish Tewari

Shabana Azmi, Uday Shankar and Manish Tewari

Mahesh Bhatt with Manish Tewari

Amit Khanna, Manish Tewari and Chandrajit Banerjee

Sam Balsara and Manish Tewari

Shyam Benegal, Ramesh Sippy, Anil Kapoor with Manish Tewari

Manish Tewari with Broadcast industry leaders

Bobby Bedi and Manish Tewari

I&B Minister Manish Tewari with Indian M&E leaders

Photos by K K Laskar

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