Media and Entertainment Sector in India Monthly Update July 2012
Top Story Videocon planning to sell its DTH business Videocon Industries is on the lookout to sell its Direct‐To‐Home (DTH) business Videocon d2h to one of its rivals. The entire idea behind this move is to build scale with subscribers but with a lower stake. Videocon is in talks with one of the largest DTH operator in the US in order to form a joint venture. However, conditions stemming out of a possible merger include minimal overlapping in the customer footprint and synergies in the DTH positioning. Though players like Tata Sky, Dish TV denied having any talks with Videocon, consolidation is slated to happen soon. Foreign DTH operators are keen to enter the Indian market but government’s restriction of foreign ownership to 26% in domestic concerns is stopping them. A rise in FDI limit is potent enough to spell a complete change in the DTH space with both foreign and domestic companies looking to come together. Another player who is also treading the same line is Reliance Digital TV who is planning to dilute stake to raise anywhere between INR 20‐25 bn. Though consolidation is deemed as a tough exercise as the operators will have to go to every subscriber and change his dish, yet industry experts anticipate that consolidation is bound to happen among cable and satellite companies.
News Update General
Sony Music focuses on nonfilm based music markets Sony Music Entertainment is eyeing its non‐film based music ventures as a prospective revenue earning segment. This comes in the wake of looking at prospects beyond Bollywood and regional music and focusing on alternate music genres. The music concern is now gearing up for its release of the 2nd season of Coke Studio @ MTV with original compositions by singers from across the country. Having sold over 15,000 CDs and over 10 mn downloads in its last season, Coke Studio is now deemed as a bankable revenue stream for the company. As local music is emerging to dominate the top selling regional and Bollywood genres, Sony is treading the lines of developing a business model to sustain itself in the non‐film segment. Recent trend shows that Bollywood fixation is experiencing a gradual shift wherein people are looking at all genres of music and though indi‐pop music had been termed as dormant, it is gradually coming to the fore. Media and Entertainment – Monthly Update
MAMI and Reliance Entertainment gears up for the 14th Mumbai Film Festival The Board of Trustees of the Mumbai Academy of Moving Image (MAMI) had discussed the upcoming 14th Mumbai Film Festival which is hailed as a Reliance Entertainment initiative. The festival is slated to be held from Oct 18‐25, 2012. The festival is planned to be moved to the South of Mumbai with NCPA and INOX as the festival venue. Additionally, in order to celebrate the 100 years of Indian cinema, it is also introducing a competition section for Indian films with cumulative cash reward of INR 1.5 mn. The Festival will pay a tribute to Italian Cinema through special selection of films from all major directors as also restored films like ‘Maciste (1915)’ and ‘ Inferno (1911)’. Further, a new edition of ‘Rendezvous with French Cinema’ will also be hosted by it in collaboration with the Embassy of France in India and Unifrance. It was also announced that filmmakers Anurag Kashyap and Sudhir Mishra have joined the MAMI board as the trustees. This festival looks at screening the best of World Cinema to foster an ambience of good cinema and as such scale up the Film Market, the Mumbai Film Mart. Acclaimed animation director joins hands with Sony Pictures Animation Sony Pictures Animation has collaborated with three‐time Emmy Award winner Genndy Tartakovsky to form an overall agreement that extends beyond his current directorial venture ‘Hotel Transylvania’. This agreement binds him to include development and direction of his own projects along with an all new take on the famous ‘Popeye’. With this deal, Sony Pictures continues its trend of attracting and retaining industry visionaries in order to craft the style of vibrant storytelling that has been its forte for the past 10 years. It is looking forward to supporting his extraordinary skills as they move towards a new innovative direction. Tartakovsky has been a veteran in this field with accreditations like 12 Primetime Emmy Award nominations, 3 times winner of Emmy Award, recipient of the prestigious Winsor McCay Award, served as a producer and director of ‘The Powerpuff Girls’ as also an animation director for ‘The Powerpuff Girls: The Movie’. He is also the creator of the “Dial M for Monkey’ and ‘Justice Friends’. This deal is slated to take animation to newer heights as it would provide Tartakovsky with the opportunity to create new stories and characters, and may even push the limits of animation in years to come. Electronic Arts puts India’s casual gamers on target radar Electronic Arts (EA), the US‐based game‐software manufacturer, is looking towards tapping the growing interest in casual games played on wireless devices in India. This is in lines with the fact that India has surfaced as the second‐largest market for mobile phones wherein a large number of young and tech‐savvy people are taking to Internet‐ready smartphones.
Media and Entertainment – Monthly Update
Casual games are more basic than video‐console games which enable people to play on mobile phones even while travelling in train or bus. EA is on the lookout to launch 41 mobile and casual free‐to‐play games in the current fiscal year and has made majority of them available in the Indian market. The primary reason behind EA embarking on a future in India is the fact that gaming industry is itself changing with a tide of low‐priced applications which is slated to be easier to sell in a price‐sensitive South‐Asian market. Further, the roll‐out of third generation mobile‐phone services over the last one year has also has witnessed a dramatic rise in the sale of smartphones. Altering dynamics have led EA to work on developing a technology that would enable users to switch mid‐game from a tablet computer to a phone or a big‐ screen TV. The Indian market is deemed as being the most focused in mobile and social gaming wherein more than 900 mn mobile‐phones users offer a lucrative opportunity to casual‐game publishers. Charlie Chaplin set to be presented in an animated version Legendary comedian Charlie Chaplin is all set to be animated for a kids’ show on television. POGO channel, a predominantly kids’ channel, has undertaken this project and is slated to air ‘Chaplin & Co’ next month. This move is primarily seen as a step to reacquaint Gen Y with the iconic actor in an animated avatar. The show will present the actor in his signature look sporting a toothbrush moustache, cane stick and a bowling hat. It will show how he deals with the everyday trials and tribulations of life and how the entire scheme of events are transformed into an event marked with hilarity and humour. Starting from how he deals with an irritable boss to that of persuading neighbour about not making his house a local garbage dump to trying to shake off a bunch of over‐zealous cops, the show is aiming to put its viewers in splits. The channel head is looking at not only entertaining kids who have never witnessed his brilliance as an actor but also adults who have actually grown up admiring him. Additionally, in order to make the entire show relevant to today’s generation, the component of animation has been rendered to be more entertaining as well as enlightening. DreamWorks Animation eyeing pact with Sony Pictures DreamWorks Animation has decided against distributing its own films after its deal with Paramount Pictures expires this fall. Further, it is looking at striking a new pact with Sony Pictures though nothing has been stated yet. The publicly held DreamWorks does not yet have a distributor for ‘The Croods’ slated to release in March as also for ‘Turbo’ scheduled for next July. It generally takes a lot of time in the likes of several months to coordinate the release of an animated film as Media and Entertainment – Monthly Update
the genre attracts a variety of promotional and merchandise partners. Representatives have sad that they want to secure a distribution agreement in this fall wherein Sony may not be the only contender. The concern has been in discussions with 20th Century Fox so that studio also remains in the list of options. Another option doing the rounds is that it would strike a deal with Fox to handle the international release of its movies while Sony would be looking at distributing them domestically. AISFM joins hands with JNAFAU Annapurna International School of Film and Media (AISFM) has signed a Memorandum of Understanding (MoU) with Jawaharlal Nehru Architecture and Fine Arts University (JNAFAU) in order to offer courses in film and media. This comes in the wake of the present crisis wherein the film and media sector is facing dearth of quality education options for students who want to embark on a career in this line. The MoU is for a period of four years and is slated to spell advantage for students wherein they can earn a government recognized degree in the process of receiving technical training in various aspects of film and media. Common fields in which courses are designed include editing, cinematography, directing, scriptwriting, producing as well as animation and visual effects (VFX). AISFM is associated with eminent personalities from the film and media fraternity including names like Farah Khan, Karan Johar, Hema Malini, Mani Ratnam, Kamal Hassan, Sonu Sood and others. On the other hand, JNAFAU is a first‐of‐its‐kind in the country, established in Andhra Pradesh with the College of Fine Arts, devoted towards developing applied art, painting, sculpture, photography and animation. The Indian film industry has been on the lookout for a concept which would enable students to gain technical film and media skills as part of a recognized degree. The partnership in the form of MoU between AISFM and JNAFAU is the ideal translation of the abovesaid concept into reality. Zee Entertainment launches ‘Zee Alwan’ channel Zee Entertainment Enterprise LLC, hailed as the largest Asia television network in the world, has launched a new Arabic channel named ‘Zee Alwan’. The channel is slated to baost of a unique content that is aimed at Arab family audiences and includes a varied choice of Arabic serials and the popular Indian TV serials dubbed in Arabic. Zee Alwan marks the maiden entry of some of India’s most popular television channels in the Middle East in Arabic. This move also adds to the momentum of the growing popularity of Bollywood in the Arab world. It completes the mission that Zee Alfam started by offering a full range of Indian content for the entire Arab family. It will be transmitted from Dubai and will be having an operational office in Kingdom of Saudi Arabia. Media and Entertainment – Monthly Update
Eros inks deal with Colors’ Viacom18 Media Eros International Media (Eros), a leading name in the Indian film and entertainment industry, has announced that it has signed a licensing agreement with Colors’ Viacom18 for new and forthcoming releases as also library films to be aired exclusively on Viacom18’s Colors channel in India. Eros International Media is a part of the Eros Group which boasts of an extensive film library and operates in the business of sourcing Indian and other film content. Further, it also showcases such films globally through its offices in India, UK, USA, UAE, Singapore, Australia, the Isle of Man and Fiji across formats such as theatres, home entertainment, television and digital new media. Some of the forthcoming films that it has inked to air include ‘Cocktail’ ‘Shirin Farhad Ki Toh Nikal Padi’ and ‘Khiladi 786’. This move will be consistent with Eros’ pre‐sales strategy to de‐risk their content slate investment as also unlock value from their film library. Opera Software set to launch TVbased browsing in India Norway‐based Opera Software has recently announced that it is on the lookout to partner with set top box manufacturers in India in order to enable DTCH, IPTV and cable subscribers access the internet from their televisions. This marks a bold move on the part of Opera on the Indian government’s drive to digitize television connections. Though the company representative maintained that no deal has been finalized, yet they agree that it is a favourable time to enter the digital devices domain. Certain other players are also considering treading this line of launching products that would facilitate browsing the internet through televisions. IT peripherals manufacturer Amkette has launched EvoTV which allows users to surf the internet on their TV. Additionally, Opera has collaborated with telecom companies like Airtel and Idea to distribute co‐branded versions of Opera Mini, the phone version of the browser. Opera Web Browser is one of the most popular web browsers across the globe along with Google Chrome, Mozilla Firefox and Internet Explorer. Since the government has declared that analogue cable services would be phased out and in turn a complete digitization would be set forth, set top boxes are required to be installed for anyone subscribing to cable service. In such a case, an additional option like browsing the internet from TV is slated to be deemed as an attractive feature that could usher in a new revolution and Opera is bound to reap profits through it. Media and Entertainment – Monthly Update
News Update Expansion Plans
Reliance Entertainment to make a foray into video market in US, Canada Reliance Entertainment Digital has announced about its foray into the US and Canadian video‐on‐demand market during the present quarter. Their primary aim is to target the Indian diaspora present in such places. It has also stated that it is currently in talks with a number of Hollywood studios for the distribution of English movies on its video‐on‐demand division in the country. For in‐house TV, they are actually in talks for distribution partnerships with those concerns that are already associated with the India community in these markets. As for on‐the‐go customers, the company has delineated a plan to target the tablet users on Apple’s iOS and Google’s Android platform. To bolster its growth plan, it has chalked out to enhance its title of its movies library from 2,000 titles to that of 4,000 in the coming four months. Additionally, it is also expanding regional movies offering by adding Bengali and Bhojpuri to its library over and above the existing Hindi, Tamil, Telugu and Malayalam titles. The company’s primary idea is to enable Indians watch Indian movies wherever they are and is looking at launching its services in US, UK and Canada. Ludhiana gets another multiplex by PVR PVR Ltd, a leading name as an entertainment company in India, has announced the launch of its six screens multiplex at the Silver Arc Mall at Ludhiana in Punjab. With this launch, PVR will be boasting of four multiplexes in three chief cities of Punjab namely one in Chandigarh, one in Jalandhar and two in Ludhiana. The multiplex spans across an area of 48,000 sq ft and has a capacity of 1423 seats. The prices of the tickets vary between INR 75‐ 400 and the audis are categorized into Normal, Paris and Gold. This launch in Ludhiana takes the total score of PVR to 179 screens in 41 cinemas in 13 states across 24 cities in India.
News Update Financials Reliance Mediaworks to raise funding from foreign private equity India’s Reliance Mediaworks has agreed to raise INR 6.05 bn from a foreign private equity fund. It has plans to utilize the funds to cut debt as also for expansion activities.
Media and Entertainment – Monthly Update
Reliance Mediaworks has three chief businesses namely a theatre distribution operation under BIG Cinemas, a TV production unit under BIG Synergy and a film and media services segment. The concern has signed a term‐sheet agreement in order to sell a substantial minority stake in its film and media services division. The film and media services division boasts of motion picture processing, image enhancement and restoration, animation and visual effects and is also attracting business from overseas. It has also mentioned that it is looking at separating its exhibition and film and media services businesses into subsidiaries. The company has expectations that the film and media services division will contribute 60 percent to overall revenue in 2012‐13 as compared to the contribution of 40 percent earlier. Industry Expert Speak Opera Software set to launch TVbased browsing in India – Sunil Kamath, Sales Director (India and SAARC), Opera Software, "It is a good time to get into this (digital devices space)...We would look at partnering someone like Huawei to build our browser onto their platform,"
Transactions (May 2012 – Jul 2012)
Date
Buyer
Target
Deal Size (INR mn)
% stake
Deal Status
Type of Transaction
26th Jun 2012
Sony Pictures Television
Multi Screen Media Pvt. Ltd.
INR 15120
32%
In process
M&A
28th May 2012
Tri Stage Inc
Hotbrands India Pvt. Ltd.
INR 400
26.4%
Completed
M&A
19th May 2012
Aditya Birla Group
India Today Group
Undisclosed
27.5%
In process
M&A
Media and Entertainment – Monthly Update
Annual Financial Results – Revenue (INR mn) Companies
FY ‘09
FY ‘10
FY ‘11
FY ‘12
3M India Ltd.
8,257./8
9,109.5*
11,893.2
14,103.7
114.1
71.0
136.3
206.5
1,600.1
1,341.7
1,309.3
2,691.2
Bharat Sanchar Nigam Ltd.
301,964.2
279,134.4
270,447.1
NA
Bharti Airtel Ltd.
369,615.5
418,472.0
594,672.0
714,508.0
1,446.1
1,704.5
1,917.0
2,768.9
571.4
635.5
418.4
NA
DEN Networks Ltd.
7,121.9
9,103.4
10,221.1
11,284.9
Dish TV India Ltd.
7,381.1
10,850.0
14,366.6
NA
DQ Entertainment International Ltd.
1,500.9
1,754.7
2,078.5
2,327.5
Eros International Media Ltd.
6,265.3
6,408.8
7,109.5
9,438.8
Fame India Ltd.
1,355.6
1,697.0
1,669.0
NA
Hathway Cable & Datacom Ltd.
6,630.2
7,331.8
8,826.1
NA
Inox Leisure Ltd.
2,259.0
2,536.5
3,703.2
NA
Mahanagar Telephone Nigam Ltd.
41,837.0
35,513.0
36,778.0
NA
Padmalaya Telefilms Ltd.
18.1
18.3
22.6
NA
Pentamedia Graphics Ltd.
131.6
540.3
259.7
NA
Prime Focus Ltd.
3,543.7
4,532.5
5,143.4
NA
PVR Ltd.
3,521.1
3,341.3
4,572.9
5,087.0
225,245.4
214,963.8
224,303.5
187,160.0
7Seas Entertainment Ltd. Aksh Optifibre Ltd.
Cinemax India Ltd. Crest Animation Studios Ltd.
Reliance Communications Ltd.
Media and Entertainment – Monthly Update
Reliance Mediaworks Ltd.
6,624.0
7,272.0
7,920.7
7,987.8
Tata Communications Ltd.
100,718.9
110,255.6
119,319.9
141,960.5
6,065.5
6,640.5
9,295.1
NA
104,855.5
118,830.7*
NA
NA
3,096.3
2,726.5
3,059.5
3,323.6
UTV Software Communications Ltd. Videocon Industries Ltd. Wire and Wireless India Ltd.
*Change in financial year
Annual Financial Results – Income (INR mn) Companies
FY ‘09
FY ‘10
FY ‘11
FY ‘12
3M India Ltd.
649.5
801.6*
988.1
647.7
7Seas Entertainment Ltd.
11.6
6.3
12.7
24.8
Aksh Optifibre Ltd.
‐320.8
‐131.4
‐489.8
196.1
Bharat Sanchar Nigam Ltd.
5,748.5
‐18,226.5
‐63,842.6
NA
Bharti Airtel Ltd.
84,699.1
89,768.0
60,467.0
42,594.0
Cinemax India Ltd.
110.5
169.7
54.5
35.1
Crest Animation Studios Ltd.
‐134.2
2.58
‐1,713.1
NA
DEN Networks Ltd.
‐151.1
301.1
375.3
145.7
Dish TV India Ltd.
‐4,807.0
‐2,622.0
‐1,919.8
NA
DQ Entertainment International Ltd.
161.2
266.7
278.6
413.2
Eros International Media Ltd.
733.3
821.1
1,172.3
1,478.4
Fame India Ltd.
34.4
‐63.3
9.0
NA
Media and Entertainment – Monthly Update
Hathway Cable & Datacom Ltd.
‐916.1
‐801.0
‐312.7
NA
Inox Leisure Ltd.
243.4
260.6
50.0
NA
‐1,430.0
‐25,553.0
‐32,895.0
NA
Padmalaya Telefilms Ltd.
‐20.4
‐4.9
‐23.1
NA
Pentamedia Graphics Ltd.
31.2
157.0
55.7
NA
Prime Focus Ltd.
145.8
334.2
760.9
NA
PVR Ltd.
87.1
13.5
81.8
254.2
60,449.3
46,550.0
13,456.5
9,280.0
Reliance Mediaworks Ltd.
‐513.8
‐1,432.1
‐3,288.6
‐5,180.2
Tata Communications Ltd.
3,158.0
‐5,977.4
‐7,769.0
‐7,946.5
356.3
533.3
1,354.8
NA
Videocon Industries Ltd.
5,151.3
‐2,749.5*
NA
NA
Wire and Wireless India Ltd.
‐962.3
‐1,757.9
‐624.3
‐913.4
Mahanagar Telephone Nigam Ltd.
Reliance Communications Ltd.
UTV Software Communications Ltd.
*Change in financial year
Quarterly Financial Results – Revenue (INR mn) Companies
AprJun 2011
JulSep 2011
OctDec 2011
JanMar 2012
3M India Ltd.
3,470.0
3,277.5
3,118.5
4,185.1
7Seas Entertainment Ltd.
51.6
56.3
NA
NA
Aksh Optifibre Ltd.
653.2
647.4
633.8
756.8
Media and Entertainment – Monthly Update
Bharti Airtel Ltd.
169,749.0
172,698.0
184,767.0
187,294.0
601.7
806.4
765.7
647.4
NA
NA
60.9
NA
2,786.3
2,552.0
2,780.6
3,166.0
279.6
629.8
637.4
725.1
1,538.1
1,748.0
4,084.2
2,068.4
NA
NA
NA
NA
8,430.2
NA
8,521.0
NA
Padmalaya Telefilms Ltd.
8.5
8.8
6.1
NA
Pentamedia Graphics Ltd.
50.2
49.2
NA
NA
Prime Focus Ltd.
1,674.8
2,025.5
2,127.5
NA
PVR Ltd.
1,164.6
1,375.7
1,364.6
1,172.0
Reliance Communications Ltd.
49,401.0
50,402.0
50,521.0
53,100.0
Reliance Mediaworks Ltd.
1,890.9
2,307.9
2,073.5
1,715.5
Tata Communications Ltd.
32,570.6
33,736.1
36,041.0
39,612.8
UTV Software Communications Ltd.
2,050.4
2,309.2
1,584.3
NA
NA
NA
30,733,900.0
NA
798.3
893.0
871.7
852.5
Cinemax India Ltd. Crest Animation Studios Ltd. DEN Networks Ltd. DQ Entertainment International Ltd. Eros International Media Ltd. Inox Leisure Ltd. Mahanagar Telephone Nigam Ltd.
Videocon Industries Ltd. Wire and Wireless India Ltd.
Media and Entertainment – Monthly Update
Quarterly Financial Results – Income (INR mn) Companies
AprJun 2011
JulSep 2011
OctDec 2011
JanMar 2012
3M India Ltd.
288.3
118.8
22.9
217.7
7Seas Entertainment Ltd.
7.2
8.2
NA
NA
Aksh Optifibre Ltd.
1.2
49.5
65.2
80.2
12,152.0
10,270.0
10,113.0
10,059.0
Cinemax India Ltd.
11.1
60.7
‐10.8
‐26.4
Crest Animation Studios Ltd.
NA
NA
13.8
NA
DEN Networks Ltd.
18.3
44.3
35.3
47.6
DQ Entertainment International Ltd.
‐135.4
217.3
169.8
78.6
Eros International Media Ltd.
216.8
273.5
690.9
297.1
NA
NA
NA
NA
‐8,500.4
NA
‐9,297.7
NA
Padmalaya Telefilms Ltd.
0.4
0.6
‐5.0
NA
Pentamedia Graphics Ltd.
5.5
2.6
NA
NA
Prime Focus Ltd.
256.1
264.3
262.9
NA
PVR Ltd.
154.9
142.0
90.0
‐132.4
Reliance Communications Ltd.
1,574.0
2,521.0
1,862.0
3,316.0
Reliance Mediaworks Ltd.
‐1,201.4
‐1,205.1
‐1,511.2
‐1,262.5
Tata Communications Ltd.
‐2,182.3
‐1,652.0
‐1,530.6
‐2,609.4
‐30.6
‐288.6
‐962.0
NA
Bharti Airtel Ltd.
Inox Leisure Ltd. Mahanagar Telephone Nigam Ltd.
UTV Software Communications Ltd.
Media and Entertainment – Monthly Update
Videocon Industries Ltd. Wire and Wireless India Ltd.
NA
NA
864,200.0
NA
‐406.2
‐145.5
‐140.2
‐243.5
Events Calendar Media Expo Delhi Date: 4th – 6th Aug, 2012 Venue: Pragati Maidan City: New Delhi Organizer: Media Expositions & Events Website: http: www.themediaexpo.com
Media and Entertainment – Monthly Update
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Media and Entertainment – Monthly Update