Television

'I forecast that in three years time there will only be two sports broadcasters who will have any kind of market share' : Harish Thawani - Nimbus Communications chairman

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Early this year in February, Nimbus shook up the sports broadcasting sector by bidding $ 612.8 million for the rights to India cricket. Driven by the vision of its chairman Harish Thawani, the company has just launched its cricket centric channel Neo Sports. A second channel Neo Sports Plus, which will look to converge somewhere between sports and entertainment, is soon to follow in the next few months.

It then signed a distribution deal with Star, which besides cable is also looking at Neo Sports to push DTH. Nimbus has also put a team in place to run Neo Sports. Indiantelevision.com's Ashwin Pinto caught up with Harish Thawani over lunch for a lowdown on the company's plans, the importance of improving stickiness, the advertising game plan, and a possible shakeout in the sports broadcasting sector.

Excerpts:

These are exciting times for Nimbus. First, the acquisition of India cricket, which allows you to enter the big league. Now you will be launching two sports channels. What is the vision you have for Nimbus Sports Broadcast?

These are exciting times for the Indian broadcasting sector as a whole. We are seeing growth rates that are unprecedented and not slowing down. The growth forecast is robust for the next three to five years. The broadcasting sector is growing faster than the economy. We are seeing 7.5 - 8.5 per cent growth rates in the economy while for broadcasting, it is growing at 17-19 per cent.

The interesting thing is that the sports sector seems to be growing the fastest. The spends on sports, whether it is on air or sponsorship or even on leisure activities, is big. You will notice that the sales of sports products like Nike, Adidas are all up.

It is interesting that we are entering the sports broadcasting industry at a time when new alignments, new partnerships are taking place. The industry is maturing in such a way that you can compete with one party in one segment and collaborate with them in another segment of business.

Our distribution alliance with Star is an indication of the growing maturity of the marketplace.

So yes, I would say that we very much look forward to the impact that Neo Sports will make, not just on the broadcasting sector but also on consumers.

More than Neo Sports, which is obviously cricket centric, we are even more excited about seeing the impact that Neo Sports Plus will make. It will be relatively slower as cricket being a bigger driver allows Neo Sports to be the bigger channel of the two. In the medium term, which is one to two years, we will be able to see what Neo Sports Plus has been able to achieve. Preliminary research shows that there is a huge appetite for a channel that converges its programming somewhere between sports and entertainment.

When they launch, what will the programming of Neo Sports and Neo Sports Plus look like?

We are launching only Neo Sports first. The launch date of the other channel is yet to be firmed up. We had earlier scheduled to launch it in the second quarter of 2007 which is April - June. But I can confirm that we are likely to bring that forward. We have been able to get ready faster. It is running ahead of schedule. For Neo Sports, the momentum will start building up towards the end of December just ahead of the first major international series.

'The industry is maturing in such a way that you can compete with one party in one segment and collaborate with them in another segment of business'

ESPN Star Sports had tried a soap concept Dream Team. That did not work out. Will you be doing this kind of programming on Neo Sports Plus?

I am not off hand familiar with what ESPN Star Sports tried. I do recall them running some internationally syndicated football show.

If that is what they chose to do then our vision is different. We have hit upon insights that may be unique. More importantly, as a company that has produced both sports and entertainment at disparate ends with more than reasonable success, the skill sets that we bring to the table are perhaps somewhat unique. It is not just based on understanding the consumer but also being able to deliver what the consumer wants.

To pick up the case study of ESPN Star Sports, I think that running an English language soap opera on a minority interest sport like football is perhaps not the formula for succeeding and establishing an audience that is loyal to the concept of sports entertainment. English language soap per se does not do well.

Football, while being a global sport, still lags significantly behind cricket in India. A Hindi language football soap opera might have done better. A Hindi language cricket soap opera will do even better.

We are not planning to do that. We will move away from the obvious and move towards the slightly more complex solutions. I hasten to add that the perception of sports entertainment is presenting sports in an entertaining manner. That is now what we are attempting to do. We are looking to converge the two.

Could you talk about the team that is being put in place to run the channels as well as the organisational restructuring?

Shashi Kalathil has joined as chief executive of Neo Sports. We wooed and persuaded him because of the outstanding track record he has as a senior management professional. He is said to be a great motivator and is a young CEO. His many years at Pepsi have given him unique insights into how large advertisers buy cricket. He has been on the customer end to what was then the largest buyer of sport in cricket in India.

It was also possibly one of the top five buyers of sport worldwide.

Traditionally the tendency of a broadcaster is to look for a domain specialist out of broadcasting. We found that we needed domain specialists from the consumer products side of things. The second advantage he brought to the table is that he has worked in a startup Aircel. A startup has its own unique set of issues to confront.

Scott Ferguson is the Asia-wide COO. He came out of the Sky Sports system. He worked with Orbit in the Middle East. We then tried to ensure that everybody under Shashi was from the broadcasting sector. Ranjith Rajasekharan is our marketing head. He come to us from MTV. Sanjay Goyal is our VP research and planning. He came back to us from CNBC. Sunil Manocha is the ad sales head and returns to us from Mindshare.

Sonali Rege is our head of production. She comes to us from Channel [V]. Hitesh Sabbarwal is our VP affiliate sales. He comes to us from Zoom, and before that Sony. Each one of them is a domain, sector specialist.

Shashi is spared the headache of having a role of having to tweak the broadcasting side of things. Customer acquisition, brand focus, revenue growth are the areas that Shashi will be able to focus on without having to worry about the back office so to speak.

Where does Digvijay Singh fit in all this?

He runs Nimbus Sport, which is the international sports rights management agency and production company. He does not fit into Neo Sports. Interestingly enough, Nimbus Sport and Neo Sport will compete in certain segments like rights acquisition.

They are two different, separate arms. There will be conflict between the two and why not? Star Sports is a partner with ESPN and Star India is our distribution platform.

This is an example where a business of one company may compete with another business of the company. The theory for us is that if 10 per cent of Nimbus Sports' profits are eaten into by Neo Sports then it is fine.

Cumulatively, they will profit much more than one entity might have done on its own. There is also a physical separation between the two entities. One is headquartered in Singapore. One is headquartered from India. Except for rights there is nothing in common with the two. One is a service provider for the industry. The other is a product delivered to the consumer.

Nimbus Sport may provide services to Neo Sports. Nimbus Sport is a global player in rights management while Neo Sport will only focus on acquiring India rights.

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