Television

'We will be the No. 1 distribution company this fiscal' : Zee Turner chief executive officer Dinesh Jain

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Zee Turner Ltd, the joint venture distribution company between Zee and Turner, is eyeing a revenue of Rs 10 billion this fiscal on the back of a faster growth from DTH while pay-TV income from cable TV stays strong.

In the earlier fiscal, Zee Turner had clocked Rs 7.5 billion after adding Ten Sports into the bouquet.

Regionalisation will be a big growth driver for Zee Turner. With Zee Telugu and Zee Kannada turning around, the contribution from the southern region is also set to improve.

Adding channels in the bouquet, which has a strong mix of general entertainment, movies and kids content, would form a part of Zee Turner‘s growth strategy. The plan is to have 50 channels within two years.

In an interview with Indiantelevision.com‘s Sibabrata Das, Zee Turner Ltd. chief executive officer Dinesh Jain talks about the company‘s bouquet strength across 16 genres, the efforts to fill in the gaps and the next wave of pay-TV revenue growth in a digital environment.

Excerpts:



 

 

Zee Turner has set an ambitious revenue target of Rs 10 billion this fiscal. Has this growth momentum since the last fiscal been led by the addition of Ten Sports?

Yes, Ten Sports has contributed but our organic growth has also been significant. I can‘t, though, comment on what our target is. But we expect to get a little under 20 per cent growth from cable TV while revenue from DTH will be at a faster pace. We, after all, have the widest bouquet with 35 channels.



 

 

But isn’t the weight of the bouquet a weakness in today’s environment where cable TV networks have no bandwidth and charge hefty carriage fees?

Providing such a wide choice is, in fact, our biggest strength. We have presence across 16 genres and have the maximum number of movie and regional language channels. In the Hindi general entertainment channel space, Zee TV is very powerful. And we have the strongest kids content in Cartoon Network and Pogo. We are a top-of-the-mind bouquet.

Our plan, in fact, is to have 50 channels within the next two years. We may not release all the channels to all parts of the country. But they can be driver channels for the relevant market. We will increase the width and depth of our portfolio.

 



 

But Zee Turner is still not the largest broadcasting distribution company in terms of revenue?

Yes, our revenues are not in line with the strength of the bouquet. But we are the fastest growing company today. We will be the No. 1 distribution company this fiscal.

 



 

Will the new wave of pay-TV revenue growth come from the regional markets?

Regionalisation is a big thing for us. We have the largest bouquet of regional channels. We have, for instance, big drivers in Zee Marathi and Zee Bangla. News is also becoming regional and in local language. Zee has launched several regional news channels.

We have set up task forces to cater to these regional portfolios. We are connecting the interiors for the regional packages and doing local trade marketing. We see big growth coming from our regional channels.

 



 

Even in the South, which was a weak link, Zee Turner would be on a stronger wicket with the turnaround of Zee Telugu and Zee Kannada?

The contribution from the South has increased as our Telugu (Zee Telugu) and Kannada (Zee Kannada) language channels started delivering. But we also had a strong base there due to our English content, led by HBO, Zee Studios and Zee Cafe. We have added WB, the English movie and entertainment channel, this year.

We expect the pay-TV revenues from regional channels to look up, including the South. Zee Marathi, Zee Telugu and Zee Kannada will give us faster growth. We will also be taking our Zee News Uttar Pradesh and Zee Tamil (which will transition increasingly to a news channel) channels pay in the next 6-12 months. This will mean that all the 35 channels in our bouquet will be pay.

Do you still miss the English news genre in the bouquet after CNBC TV18 moved out?

We do not have channels in genres such as infotainment, travel, English general news and English business news. There are some regional languages where we are also absent. For completing our portfolio, we would be looking at filling such gaps.

 



 ‘Regionalisation is a big thing for us. We have the largest bouquet of regional channels. We have big drivers in Zee Marathi and Zee Bangla. Zee has also launched several regional news channels‘

 



 The government has recently come out with a Headend-In-The-Sky (HITS) policy. How do you see this impacting Zee Turner?

HITS offers another great opportunity for digitisation and addressability. We expect the Telecom Regulatory Authority of India (Trai) to come out with a pricing policy for HITS. As long as the delivery platforms and addressability are similar, the pricing policy should be same.



 

 

Do you strongly feel that Trai needs to lift the freeze on pricing?

The freeze in pricing has led to anomalies. Different channels in the same genre are priced differently because they were launched in different dates. The price freeze will not, thus, impact the channels equally.

A case in point is Zee Sports. If Zee Sports is to acquire a cricketing property paying as much as Star Cricket does, it will be at a disadvantage because of the price freeze. Launched later, Star Cricket is priced higher.

Trai, in fact, is looking at revisiting the price freeze issue. Today there is enough competition in the market for channels not to start profiteering from high prices.



 

 Is Zee Sports turning out to be a liability as it is devoid of cricket after failing to bag the BCCI rights?

No, but then there is definitely an opportunity loss. However, it is overcome by the strength of the bouquet.



 

 

How is Zee Turner gearing up for the digital environment?

We are building capabilities for the digital environment – be it IPTV, DTH, cable TV or 3G devices. India will have all models successful because it is such a huge market. We have created vertical heads separately for digital, analogue cable and commercial business 18 months back to bring more focus into these business segments.

 



 

Do broadcasters see faster growth coming from DTH?

Cable TV currently accounts for 70 per cent of the broadcasters’ pay-TV revenues. We see the industry settling at an equal ratio between analogue cable and digital platforms within two years.  



Broadcasting distribution companies have entered into joint ventures like Zee Turner, MSM Discovery and Star Den. Is there scope for further consolidation?



There are still many splinter groups such as Sahara and UTV. At some stage, they may decide to align. We are looking at such opportunities and alliances.

 



 

Cable networks have been consolidating over the last few years. How do you see this impact broadcasting companies?

The market is getting matured and organised. Though we are seeing the emergence of bigger MSOs (multi system operators), this will mean that the business is getting more rationalised. Bigger cable companies will look at improving bandwidth. There will be huge upsides - much like the coming together of organised retail helping FMCG companies.

 

, Zee Studios and Zee Cafe. We have added WB, the English movie and entertainment channel, this year.

We expect the pay-TV revenues from regional channels to look up, including the South. Zee Marathi, Zee Telugu and Zee Kannada will give us faster growth. We will also be taking our Zee News Uttar Pradesh and Zee Tamil (which will transition increasingly to a news channel) channels pay in the next 6-12 months. This will mean that all the 35 channels in our bouquet will be pay.

Do you still miss the English news genre in the bouquet after CNBC TV18 moved out?

We do not have channels in genres such as infotainment, travel, English general news and English business news. There are some regional languages where we are also absent. For completing our portfolio, we would be looking at filling such gaps.

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