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MUMBAI:
Sony Entertainment Television India (now called Multi Screen
Media) has let loose the pink slip epidemic, cleaning up close
to 50 people in one of the biggest layoff operations a multinational
TV media house has seen in India.
The
financial mess needed cleansing and the management needs to
nurse the company back to health, a minority Indian shareholder
tells Indiantelevision.com on request of anonymity.
The
crisis hit the peak early last year when the company board
decided to infuse a fresh capital of $40 million from all
its shareholders. The Indian shareholders, who have close
to 32 per cent stake in the company, challenged Sony's capital
call decision and moved the court only to withdraw a few days
later.
 Sony's
only bright spot was the telecast rights for the Indian Premier
League (IPL) while the flagship Hindi entertainment channel,
the main revenue earner for the company for years, was under
fire as Zee TV resurrected and newbie Colors went up the ratings
ladder in hot chase of market leader Star Plus.
Max,
though, continued to succeed with the telecast of mega movies,
but acquisition costs were damaging the business models of
movie channels.
The
axe was waiting to fall in an environment of economic downturn
and "messy performance" (as the Indian shareholder
says) of the company.
The
new era of Sony will be without Kunal Dasgupta and a bunch
of others who worked closely with him. Sony had grown in substantial
size but the time, perhaps, had come for a major surgery.
"We
are close to 50 people out. As with many businesses in this
tough economic environment, we believe the rightsizing will
help us run the company more efficiently and effectively.
The changes in personnel are a one-time event and will make
us stronger, going forward. There will be no further bouts
of trimming," says MSM interim CEO Man Jit Singh, who
joined the company in 2007 as chairman.
Singh
has already chalked out a growth plan for Sony, the prime
move being a participation in the fast-growing regional space.
The first catch has been the acquisition of Channel 8, a Bengali
movie channel, for an undisclosed amount.
"There
is no other Bengali movie channel in the market. We saw a
unique opportunity in this as Channel 8 has the rights to
most of the Bengali films," says Singh.
What
Singh is not saying is that Channel 8 has been acquired by
Sony Pictures Television International (SPTI), with the Indian
shareholders - or MSM - having no stake in the regional channel.
"We wouldn't like to comment on the shareholder issues,"
he says.
Sony
is also seeking to stretch its wings in other regional markets,
either in the general entertainment or movie channel space.
"We are first looking at the South Indian-language markets.
We are also considering Gujarati and Marathi language channels.
The route we take could be through acquisition or organic,"
says Singh.
In
Sony's distribution bag is also Colors, the second most-watched
Hindi GEC, which will turn pay from 1 April. Market insiders
say the three-year deal is based on an exorbitant minimum
guaranteed amount along with the other Viacom18 channels MTV,
Nick and VHI.
"TheOneAlliance
bouquet will emerge stronger after this. Along with IPL, it
will ramp up the pay-TV revenues for MSM Discovery. But the
challenge is to make it work on the RoI (return on investments)
front," says an insider in the company.
Singh's
other task is to get the company a chief executive officer
as early as possible, though some senior officials in the
company say he has been given a six-month time frame. "A
search firm is helping us find a CEO to replace Dasgupta.
We are actively pursuing internal and external candidates,"
says Singh.
A
contender in the race is MSM COO NP Singh who also has the
support of the Indian shareholders.
The
choice is still not out but the new CEO will, however, have
to play the balancing walk between Sony and the Indian shareholders
till they find an exit route.
Also
Read:
Kunal
Dasgupta quits Multi Screen Media
Sony
biz head Albert Almeida quits
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