India can be entertainment-outsourcing hub

NEW DELHI: The market for entertainment products, including television, films, video games and music, is huge in India and Asia, in general. But for that a concerted effort needs to be made by the industry that needs to do some work in human resource development and the government, which needs to

come up with some more tax sops, experts felt here.


Pointing out that the buzz should be about Asian business and not just Indian alone, celebrated filmmaker Shekhar Kapur said, "The market for entertainment products is about $350 billion (globally) and even if India is able to capture at least 50 per cent of the same, it'd be a huge amount."

Kapur, along with Star India CEO Peter Mukerjea and young filmmaker Manu Reval were addressing a session on "The Indian Entertainment Industry" at the India Economic Summit, jointly organised by the Confederation of Indian Industry (CII) and the World Economic Forum (WEF), here today.

Zee TV president Apurva Purohit, slated to participate in this session, failed to turn up, depriving the audience of the experience of India's largest vertically integrated media company, Zee Telefilms Ltd. The company operates in various segments of the entertainment industry, including theme parks, film production and, of course, cable and satellite TV.

Making a strong case for the Asia, Kapur felt that in about 10 years time in a "reverse cultural colonisation", 70 per cent of the global revenue would come from the Asian entertainment industry. "Even in India, where the entertainment industry holds great potential and is beginning to open up, it's just the tip of the iceberg," he added.

And, why the domestic entertainment industry should be strengthened? According to Kapur, the globe cannot be conquered, unless the domestic market is optimally tapped.

"McDonalds did not become the biggest food franchisee in the world without becoming one at home (in the US)," Kapur contended.

Kapur also felt that new technologies like mobile technology, music and online ventures would fuel the growth as a time would come when there would be "some sort of convergence." Development of delivery formats, including mobile entertainment, and consequent development of content conducive to these platforms, has to be encouraged to develop new revenue streams, he explained.

Pointing out that India is beautifully positioned to benefit from this trend, Kapur said that the Indian market could capture this opportunity by utilising two main tools: new technology and nurturing new talent.

He said that creation of digital theatres is a cost-effective option as it helps cut down the cost of distributing (film) prints, while combating piracy. "This would be especially beneficial in the Indian scenario and generate economic gains. Currently, the growth of infrastructure is happening only for the 'A' category cities and the same has to spread to 'B and C' category towns also as real growth would come from there," Kapur held forth on what is his favourite topic these days, apart from film making.

Quick to elaborate after Kapur had set the tone, Star India's Mukherjea pointed out the huge "opportunity gaps" that exist in the Indian television market.

Of the 150 million Indian households capable of owning a TV set, only 75 million do so, he said, adding and of this, around 60 per cent are black and white TV sets, while households accessing cable & satellite channels are 42 million.

Correlating this number to the 65 per cent Indians below the age of 30 years that devote only about two hours a day to television, as opposed to around six hours a day in the US, Mukerjea said, "There is a huge opportunity waiting in India in the form of this segment of population that spends more than other age brackets, and can devote time to entertainment through television."

The other important issue that needs introspection, according to Mukerjea, is development of India as an outsourcing hub for television software.

India offers huge cost advantages for development of television content, he said citing the cost of productions in the US and India.

The average cost of producing an episode of X Files, at present aired on Star Plus, is approximately one million dollars in the US, whereas a decent production can be done in India at three per cent of this cost, or less, Mukerjea said.

Pointing out that efforts should be made towards development of India as South Asia hub for television content and also entertainment-related products, Star India CEO said, "The thrusts have to come both from the government and the industry. The television industry should position itself as the preferred career choice for young talent. The government, on the other hand, should give tax breaks and other incentives to promote infrastructure for the same."

According to Mukerjea, increasingly young people are opting for careers in media and communications and entertainment is not much different.

Responding to a query from, Mukerjea, however, clarified that Star would not like to get tied down to training people for the entertainment industry in a formal way like opening up a training school. "But if an organisation like NIIT can devote one of its training centres for entertainment industry, it'd be worthwhile," he said.

Reval, the young film director, reiterated the importance of development of new talent in India.

He said that corporates should pool their resources and create a corpus that would help train newcomers in the industry on issues like access to finance and other professional practices particular to the film industry.

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