NEW DELHI: A news channel of their own! It couldn't have been a better Diwali gift for the 120-odd employees of the Rajat Sharma-promoted Independent News Service (INS), a television production house that is converting itself into
It's official now that Sharma would be launching India TV, a 24-hour Hindi language news and current affairs (N&CA) channel, early next year. The uplink permission was obtained last year in a quiet manner.
According to sources, the whole project, being put together for the last six months with the help of Ernst & Young, would need investments to the tune of Rs 1,000 million, including transponder lease cost.
Initially, approximately Rs 700 million is being pumped into the news channel, to be beamed through `hotbird' PanAmSat 10. The amount will also be utilised for acquiring real estate of about 80,000 sq. ft and building a state-of-the-art infrastructure, specially for transmission of N&CA programming.
To raise the initial funding for the project, promoter Sharma and his wife, Ritu Dhawan, have divested 26 per cent equity stake to two Indian investors who can be considered friends of the promoters, apart from being professionals.
In the future, INS promoters are looking at roping in another strategic partner who can take up to 23 per cent stake in the company. This would mean that the promoters would retain 51 per cent majority control of the company.
The company, however, is not looking at attracting foreign investment in the news channel venture.
INS has reportedly brought in professionals to handle various other related activities like distribution and ad sales, but the marketing aspect would be looked after by Euro-RSCG.
A former general manager with India's long distance telecom carrier Videsh Sanchar Nigam Ltd (VSNL), has
been brought in as the technical head.
Though India TV would like to stand alone like MTV, the likelihood of hitching up with one of the existing bouquets - Star, One Alliance and Zee Turner - for distribution purpose cannot be ruled out in the future.
The good news of turning the TV software house into a broadcasting company was conveyed to the INS employees in a personal letter sent to each of them by Rajat Sharma yesterday. The employee strength of the company goes up to 250 over the next two months.
Sharma's letter sought to impress upon the employees and colleagues that after five years with Zee and almost five years with Star, it was time to move ahead. The obvious road ahead for Sharma was to launch his own news channel - India TV.
Sharma's company, which produces the two editions of Aaj Ki Baat news shows on Star News at the moment, would cease to do so from this month-end. The reason: Star India feels that such news shows can be produced in-house.
Sharma decided to go ahead with a news channel - in a scenario where channels are mushrooming all over in India - after considering a IMRB-conducted survey which showed, there is still scope for a Hindi language news channel and the market can probably sustain it too.
Amongst the Hindi news channels currently on air are market leader Aaj Tak, NDTV India, Zee News, Star News and three Sahara Samay channels.
Doordarshan too proposes relaunch its news channel with predominantly Hindi programming.
The IMRB survey, commissioned by INS to gauge the market response, also highlighted the fact that Sharma's brand equity is high amongst viewers - something that India TV would certainly like to cash in on to translate into
Meanwhile, INS' studio complex located in Film City, Noida, is being given finishing touches at the moment. The complex has four floors; and one of the studio floors is understood to be the biggest in Asia.