Television

'We have enough high quality relevant content to provide for each of the three channels' : RC Venkateishi- ESPN Software India managing director

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Just when everyone was thinking that sports broadcasters might look to "de-risk" the cricket story, ESPN Star Sports has announced the launch of a dedicated cricket channel for Indian audiences. The new channel, christened Star Cricket, will commence transmission in June.

Star Cricket will be making its bow with a big bang property to showcase because its launch coincides with the India tour of England that involves four Tests and seven One Day Internationals.

Indiantelevision.com caught up with ESPN Software India managing director RC Venkateish in an attempt to get a feel of what was guiding this decision.

Excerpts:

Is this the right time to launch another cricket centric sports channel, particularly considering the disillusionment of the general public with the game in the country?

Suffice to say that there is still no challenge to cricket as the single sport which has pole position in the Indian market. And I don't see that changing anytime in the near future. So, from the perspective of timing, we really don't think that is an issue.

What is more important is the longer term picture and going forward we continue to believe that cricket will continue to hold its own and in fact strengthen as there is a lot of new talent coming in.

Nobody's is arguing that India will not continue to remain cricket-centric. But the fact of the matter is that for something like this to work, it has to be underpinned by high levels of interest in the domestic game as well, which is not the case in India. In fact, this is a problem that Neo Sports seems to be confronting as well.

Which is a pity actually. In fact, if the local tournaments are properly marketed and properly packaged for the viewers, have the potential. We unfortunately don't have the rights for that.

Exactly, and isn't that what Nimbus is hoping to leverage on Neo Sports. And you don't have local Indian cricket to showcase, so what is the USP of your channel?

What we will be showcasing in fact, apart from the international matches, is county cricket in England and domestic cricket in Australia, which also feature some of the best players in the world, including a lot of Indian players. There will also be a substantial effort to market that.

In many ways we will be doing a parallel to things like English Premier League. Where it was four or five years ago to where it is today, it is really a result of the investments that we have done in promoting that property and making it interesting for the viewer.

If you just pick up something and put it on the channel, it is not going to work. That is the job of marketing to popularize a particular sport. It has to be exploited and executed properly. Even the domestic Indian tournament, it needs to be put across properly to the viewer. It is not something that will happen automatically.

There are two strands to the communication that you sent out on your upcoming channel. One is that you will showcase live India and non India cricket. You will also showcase feature programming, including reality reality shows?

Reality shows are like we had recently Harsha ki Khoj Dream Job. That genre has lot of space. It has a lot of opportunities for us to create programming around that. We will be developing more such shows and putting them across to the viewer.

Fair enough but the point is that now you have three platforms through which you have to transmute content. Is there enough content to go around?

On the content side, over the last couple of years, we strengthened our cache, not just in cricket but in all other sports. We just recently renewed the English Premier League. We have the Spanish League, we have Euro 2008. Those are the big soccer properties. In tennis, we added the French Open so we now have it along with Wimbledon and the Australian. In motor sports we have Formula 1 and A1. In golf we have all the major properties.

So, if you look at each and every sport and the key properties, they are all residing on our channel. Along with this, we have other smaller content also which has come on the network.

As for cricket, for the next 14-16 months I have India's tour of England, the Twenty20 World Cup, India's tour of Australia, the Asia Cup and the Champion's Trophy. That is five major cricketing events.

So I don't believe that we are in anyway falling short of providing high quality relevant content in each of these three channels.

What about distribution? Right now we are in a very uncertain distribution market, both on analog as well as on digital cable, with Cas only in the beginnings of being rolled out. And in such a time you are launching a 3rd channel?

I agree with you that there are a lot of people having trouble finding distribution. But ultimately, your bottom line is going to be content. I think we will be in a position to demonstrate it through cable and to the viewer that the content we have to showcase on the channel are of a quality that must be carried.

Let us accept that you have great content, but today the reality of placement fees cannot be wished away. And it means that slots are booked on tunable bandwidths for one year, two years…

I think that applies more to other genres. Unless people see your channel how will they get hooked on to it? They will not demand it. For my cricket channel, I don't have to create a demand.

There is the recent example of Neo Sports, which had great content but still faced distribution problems?

The difference is that Neo Sports did not have its own distribution team.

Well they had Star distributing them, which is as good as it can get?

I don't know what Neo Sports needed to do but they didn't do, or what support they got, I don't really want to comment on that. But as far as we're concerned, we have the strongest distribution as well as distribution team in India, and I am completely confident that we will not have any issues with our channel.

'We have been delivering higher and higher reach and we haven't seen the proper monies for that as yet'

That still doesn't explain how you're going to find place in a tunable bandwidth if all the slots are already locked in.

In case there is a cricket match happening, he (the cable operator has to put it in the prime band. I can't see a situation where the matches will not be shown.

There is the option of DD, where the matches are being shown because of must carry.

Test matches are not going to be shown on DD. I agree with you that channels tend to go up and down, especially the ones who don't pay money to the cable operator. That is a fact.

Even then, we have always managed to be there in prime band even when we didn't have cricket running. And you must understand that in regards to sports channels there has been a certain amount of consolidation. So the other channels which don't have relevant content tend to be pushed onto the hyper band.

There will be a little bit of juggling and we will have to manage that. But as a company policy, we will certainly not pay any carriage fee or any placement fee. We are a pay channel and we will get our price.

What rates have you fixed for the new channel?

We haven't announced the final rate but it should be in the region of around Rs 28 to RS 30.

Let's talk about the ICC cricket rights. I take you back to a comment you'd made earlier to Indiantelevision.com that the crazy escalation in rights prices will start cooling down a bit. And yet you went and plonked $ 1.1 billion for those rights?

If you do a bit of math, you'll see that whatever I said earlier has actually happened. Let's benchmark it with some of the other rights. The BCCI rights, which the previous version was for $ 50 million for five years, went for $ 612 million for four years. So that's basically an escalation of 1,400 per cent.

Now take the ICC, the last ICC went for $ 550 million. So that's basically a 100 per cent increase. And the last ICC did not have events like the Twenty20 World Cup, which have been added on this property.

What we have paid over eight years, is basically a 9 per cent per annum escalation in rights fee, as opposed to some of the other properties, which in recent times have gone absolutely berserk. The BCCI, as well as the BCCI offshore cricket rights package sold to Zee for over $ 215 million ($ 219.15 million).

Even if you look at things like the Sri Lanka board for $ 50 million, or the Bangladesh board, which went for $ 56 million after going for $ 6-7-8 million last time.

So what we have paid for are not just the World Cups and Champions Trophies, but also what is going to develop into a real cracker of a property - the Twenty20 World Cup. Not once, but thrice.

From an average per day cost perspective, and if we compare the three properties that went for big bucks, how does such a payout work?

Zee paid $ 8.71 million, BCCI went for around $ 3-4 million per day and we are around the same ball park.

There are also the cricket rights that are coming up over the next 12 months for many big territories over the next year and a half. You have already committed $ 1.1 billion for the ICC rights as well as all the other rights you've mopped up recently, so where do you stand on that?

We are quite comfortable with the levels of investment we've made thus far and what we have identified as key acquisitions for the future.

But having the ICC rights provides us a very strong backbone of cricket over the next eight years. Whatever else we add on would be accretive to what we already have so it won't be necessary to go out and buy everything under the sun.

What of the territories that ESS currently own - England, Australia, New Zealand, South Africa? Will you be making aggressive bids to retain them?

We haven't formalised how we're going to go about it yet.

I again come back to the disaster that was the World Cup. Everyone was expecting 2007 to be cricket's year as far as advertising is concerned due to the sheer volumes of A list properties that are coming up throughout the year. Now will all the calculations have to be reworked?

On this I have a different take. I think the advertisers have had it pretty good so far. I have an argument we need to push more forcefully and that is something as a broadcasting community we haven't done enough of. The fact of the matter is all the rates that advertisers have been paying us have been on the basis of CPRP at a time when overall reach has doubled.

But this is an argument that Star's Paritosh Joshi has raised, as too Zee's Joy Chakraborty. Today we are faced with a situation where HLL has pulled out its advertising from Star. And the broadcasting community does not seem to have any unity on this issue so what are we talking here?

There is unity developing on this issue and you will see a more forceful exposition of the point in the days to come. Certainly at IBF we are all seized of it in terms of a consolidation of our position.

We have been delivering higher and higher reach and we haven't seen the proper monies for that as yet.

Coming back to the development of local sport, you've earlier stated that Sports federations need to get their act together. One of the biggest culprits in that sense is the IHF run by KPS Gill with whom you're a partner. One could say that it is because of the mess the IHF is in that the PHL is not taking off. So doesn't it make sense to encourage the IHF to get itself sorted out?

Our experience with the PHL has been very positive. There wasn't anything in PHL that we needed to do and have not been able to do because of lack of support from IHF. Suffice to say that we are quite happy, both with the way the PHL has performed and with the kind of partnership we have with the IHF.

But you yourself have said one reason why PHL is not taking of is because they are not performing well internationally. I think it is interlinked. If the federation was being run properly, the teams would be doing better internationally. A follows B, one could argue.

How federations are run is not something I would like to comment on. We stand ready to help the federation in any way we can but it is not our brief to tell the associations how they are to be run. Because, quite frankly, this is something they need to work out among themselves.

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