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MUMBAI: Raghav Bahl is restructuring his media and entertainment
companies under three operational heads as he gears up for
expansion after getting Reliance Industries Ltd (RIL) to indirectly
invest in it.
 Forming
IndiaCast, a distribution company that houses content syndication
as well, Bahl has got individual heads to shepherd the entertainment,
news and distribution businesses that are entering a new growth
phase.
Bahl's
broad plan could be to bring the ETV regional entertainment
channels under Viacom18 operational management while its news
entities will be under TV18, a source familiar with the development
says.
It is not clear yet if this operational structure will be
allowed to transition into an equity arrangement. For this
to happen, media conglomerate Viacom will have to agree to
invest and induct the ETV entertainment channels into the
joint venture company, Viacom18, where it holds 50 per cent
stake.
"Nothing
has been finalised yet. Viacom, no doubt, will be happy to
have the regional GECs under Viacom18. A lot will also depend
on how RIL wants the structure to evolve. But there are other
issues as well," the source says.
As
part of the plan to fortify its regional presence, TV18 acquired
partial ownership in the broadcasting assets of Eenadu after
valuing it at Rs 21 billion. With the purchase, the company
has got 100 per cent stake in 5 regional news channels of
ETV (where RIL has 100% interest), 50 per cent stake in 5
regional GEC channels excluding Telugu (where RIL has 100%
interest) and 24.5 per cent stake in ETV Telugu channels (where
RIL has 49% interest). The news channels include ETV Uttar
Pradesh, ETV Madhya Pradesh, ETV Rajasthan, ETV Bihar, and
ETV Urdu. The regional GECs are ETV Marathi, ETV Kannada,
ETV Bangla, ETV Gujarati and ETV Oriya.
The restructuring exercise comes in the wake of these developments
and the exit of Haresh Chawla who functioned as Network18
and Viacom18 Group CEO.
"The
role of Chawla was too unwieldy as he had full control of
all the group companies . After his exit, a restructuring
was needed keeping in mind the growth plans," the source
explains.
Network18
Group has a combined turnover of Rs 19.52 billion that includes
50 per cent of Viacom18 (Colors, MTV, etc), the news channels
under TV18 (CNBC TV18, CNN IBN, IBN7, etc), the web properties
and HomeShop18. As the company gears up to launch a Hindi
movie channel (put on hold) and regional-language channels,
a breakup in roles is the need of the hour.
"It
wasn't practical for Chawla to oversee the whole of Bahl's
empire. His operational role at Viacom18 at times was uncalled
for and led to a quiet unrest," says a senior executive
who has left the company on condition of anonymity.
Bahl
Wednesday announced the hiring of Sudhanshu Vats, a
senior executive at HUL, as the group CEO of Viacom18 Media.
Under him will fall Colors, Comedy Central, MTV, Nick, Sonic,
Vh1 and Viacom18 Motion Pictures. He has already recruited
Anuj Gandhi, an industry veteran, to spearhead IndiaCast's
growth.
Bahl's
new structure will mean that the non-ad sales business falls
under the care of Gandhi while Vats gets to groom the entertainment
networks and Sai Kumar to directly nurse the news and web
businesses while continuing his role as Network18 and TV18
Group CEO.
"Earlier,
everybody was reporting to Chawla. Now the reality is that
each of these lines of businesses need individual management
and are too expanded to be operationally under one CEO,"
the source says.
 Take
IndiaCast, for example. The new distribution company, under
which also resides the syndication business, is already having
a turnover of Rs 4.30 billion. Bahl's ambition is to scale
this up to the size of the biggies, particularly in a digital
environment where there is going to be exponential growth
in subscription revenues. Zee Entertainment Enterprises Ltd
(Zeel) reported domestic subscription of Rs 9.22 billion in
FY'12 and Rs 1.32 billion through other sales and services
(syndication sales, playout & transmission services and
facility usage income).
Bahl
has given IndiaCast a wider playground, bringing under its
umbrella content asset monetisation across geographies, platforms
and mediums. The other channel distribution companies do not
have such a broad canvass and content syndication falls outside
their functional zones.
"Bahl
believes that IndiaCast has enough leg room to grow and become
a Rs 10 billion company over the next few years after digitisation
of cable TV spreads," a media analyst at a broking firm
says.
Vats
will also have his plate full as the group expands its regional
footprint and comes out with a Hindi movie channel and other
entertainment products that are sure to launch in a digitised
environment.
Kumar
will have a tough task cut out for him as he tries to
beat slow revenue growth for news channels. The web properties
will also have to be guided to a scale that will make it comfortable
for Bahl to tap the American market for raising capital through
a public float.
After
being rescued from a debt overhang by RIL, Bahl is laying
out the new leadership structure that will provide fertile
ground for new growth.
Also
Read:
Sudhanshu
Vats joins Viacom18 as Group CEO
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