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An
interview with A K Madhavan
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"Crest to increase television presence"
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Posted
on 23 April
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Crest
Communications Ltd, one of the leaders in 3D animation in India, has
big plans for the future with a number of major projects on the anvil.
Crest was incorporated in May 1990 and operations began in 1991. The
company's main business is 2D and 3D animation and graphic services
for ad films, feature films and TV serials. Crest has received several
awards for the quality of its work and service. It has recently declared
itself a debt-free company and plans to fund all upcoming projects
through internal resources.
Indiantelevision.com met A K Madhavan, senior vice president international
business for a lowdown on the company's plans. Excerpts from the interview:
In the genre of animation,where is crest concentrating its
efforts?
Crest is more into 3D than 2D animation at this point and though
we do a lot of 2D work, it is in 3D that we are concentrating our
efforts.
Any particular reason for that?
While the animation industry here is growing at a tremendous pace,
nobody has seen real results as yet. The industry is still finding
its feet. And if we look at 3D markets, they are growing in geometric
progression at a rate two to three times faster than 2D markets.
If no one has seen results as yet, is the effort really worth it?
In this business, revenues could get delayed but there is almost unlimited
shelf life of good products. Worthwhile animation, whether 2D or 3D,
is something that will never become dated because there will always
be an audience for it.
Could you elaborate on why you feel no one has seen results in
India?
Animation costs for a half hour episode work out to around Rs five
million and no channel will pay that kind of money. The immediate
returns on a hit soap are much higher. Actually, the Indian and Asian
markets have not matured as yet so all of us are looking to the west
to sell our products.
Wouldn't the same logic apply there also?At least for a producer
of animation shows?
There's a huge difference in the West, which is why we say that markets
there are matured. Take an example of a show like the The Simpsons.
A half-hour episode costs $1.8 million. But they still manage gross
profits of $2 million a month for a show that is aired once a week.
The production costs seem a tad high, don't they? It's not as
if the cartooning is very elaborate or anything.
That's true but the real costs for a show like The Simpsons
are from voice casting and scripting. The cartooning itself is nothing
extraordinary.
Leave aside The Simpsons, which is in a different league,
what are the average costs of making a half-hour episode in the US?
The cost breakup in the US is typically $200,000 to $400,000. The
same quality of work in India can be achieved at $50,000. Basically,
the principle applied in the Asian markets, and that includes India,
is of sweatshops.
But even here , it is countries like the Philippines and Vietnam
that are dominating. So where does India stand in all this?
That is the problem when you work within the sweatshop formula. There
will always be someone who can provide the same thing at a lesser
cost. We have to try and get out of this and create quality products
for which there will always be takers.
That is what the world markets really need. The problem in India is
that we lack schools that can churn out individuals with the required
skill levels. At Crest, we are trying to get around that by conducting
in-house training programmes on a regular basis.
 Talking
of skills sets, Crest was supposed to have signed a merger deal with
the American company Rich Animation. Has the deal gone through?
It's a 100 per cent acquisition really. The buyout was achieved at
a cost of $2 million and was completed in February. The American company
is now called Rich Crest Animation.
What drew you to Rich Animation?
The main attraction was that it had the experience in making full
length animation movies. It has made four till date. The Swan Princess
and The King and I were Rich Animation products.
Wasn't The King and I a feature film where Jodie Foster
played the lead?
The Rich Animation film happened to be released around the same time
as Foster's film, but it was certainly a different one.
If the company is so good, a $2 million price tag seems really
low.The Pentamedia buyout of American company film Roman is reportedly
going through at a cost of Rs 15 million.And why was Rich Animation
up for sale in the first place?
As far as Rich Animation goes, all I can say is that we were really
lucky. The parent company Nest Entertainment decided to get into the
Internet business in a big way sometime in April last year which is
why they put it up for sale. Everything just fell into place, really
speaking.
And as for the Pentamedia deal, I think they are having some problems,
so I have my reservations about the sale going through.
There were reports that Crest and Rich Animation were working
on a $20 million 3D movie and aiming for a Spring 2002 release. What's
happening on that front?
The budget has now been upped to $40 million and we are looking at
a Spring 2003 release. We are still in pre-production work. We are
in the final stages of talks with a Hollywood major and expect production
to start in June 2002. We will be signing a completion bond with the
studio to complete the film within 104 weeks.
What is the film about?
It is an action-cum-animation film set in a car plant with the plant's
robots as the main protagonists. We're quite excited about the project.
What about television? What sort of work are you doing in that
field? Crest is a fairly new entrant into television programming
but we are planning to increase our presence here. We have done three
serials till now, but none have been animation based. They are Mere
Angane Mein, a sitcom on Sony Entertainment Television; Meri
Marzi, a chat show for tweens (nine to 14-year-olds) on
Doordarshan Metro. And Purush Kshetra on Zee TV which was hosted
by Kiron Kher and modelled on the lines of Oprah Winfrey's celebrated
talk show.
 What
are your forthcoming projects?
At present, Crest is working on the pilot of a game show for children
which will have a high level of interactivity as well as technological
innovations. An idea being explored is to use phone lines not only
for calling in, but also to allow a participant to play using the
keys on his phone instrument as a game console. For this, Crest is
in contact with national telephone services provider MTNL.
Do you plan to get into TV production in a bigger way?
We have set ourselves a target of having six programmes on air before
the end of 2001.
What kind of projects are you looking at?
Of the six projects we are planning, two will be high quality products
with the kind of production values seen in the critically acclaimed
TV series Malgudi Days. The other four would be your average
bread and butter variety of soaps and sitcoms, the kind which are
proliferating across the small screen at present.
What are the costs involved?
The top rung series will cost in the region of Rs 600,000 per half
hour episode, while the other four will cost between Rs 2,00,000 and
Rs 3,00,000 per half hour episode.
With all these new projects, are you expanding your operations?
On the animation front, we are in the process of expanding from 40
to 100 graphic stations.
And how are you as far as funds go? The Crest scrip has been mauled
in recent times and Kotak Mahindra has come out on CNBC saying a major
reason for this was that the company had too many debtors.
If you're taking about our share value, I think the bourses have been
bad for everyone. As for the Kotak Mahindra quote, we had responded
to them immediately afterwards and asked them to corroborate their
statement. Which they failed to do.
For the record, I would like to state that Crest is a debt free company.
There was a period where we faced financial difficulties and had problems
servicing our outstanding loans, but we are over that now.
Funds for all upcoming projects will be raised through internal resources.
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