Viacom18's Colors Kannada Cinema aims to break even within 3 years

Owning many titles makes it easier for as it won’t have to spend on creating a library

MUMBAI: Viacom18 is making moves in the regional space. Its latest bet was to launch a movie channel for the Kannada market called Colors Kannada Cinema. The conglomerate has a Hindi movie channel called Rishtey Cineplex which broke even in two years. Similarly, the idea is to get the Kannada movie channel to break even within three years too.

Viacom18 head regional entertainment Ravish Kumar told that that typically a movie channel or any other channel looks at three years to break even but Colors Kannada Cinema will break even before that. He explained that owning many titles makes it easier as it won’t have to spend on creating a library.

With Colors Kannada and Colors Super gaining popularity, the channels aren’t able to accommodate many movies and so the need for a separate channel to utilise the assets was felt. The network has better leverage with more channels to showcase movies on.

Surprisingly, Kumar said that pre-selling of ad inventory hasn’t been done for the new movies channel. “They undervalue your asset and the other point is people feel cheated if they put their faith in you and the return isn’t as expected,” he said. Instead, the idea is to get the channel going and work on distribution before thinking of ad rates.

While production cost for Hindi keeps growing, Kumar says that there is a cap in the regional space. The increase will be inflation or technology led. He gave the example of a federation strike in West Bengal asking for an increase in technician rate. “That is going to lead to an overall 5-6 per cent increase across the board. But in a lot of the other markets, we have held costs and in some markets, we have actually reduced them,” he said. If the network decides to skew in favour of more reality shows or events, then the cost is likely to shoot up but fiction will see a moderate increase.

According to the KPMG report 2018, adex on regional channels observed an increase of 5.4 per cent in FY18. Kumar said that part of it could possibly be caused by the FTA channels which have come up in Hindi. The viewership has moved to them and that has led to margin dilution as opposed to margin accretion. “On the regional space, you must have seen a lot of consolidation on the top end so where the strong are getting stronger and the weak are getting weaker, more margins are analysed which normally means that the ability to command high rates are high.” He added that it is backed up with a lot of investment in formats like reality, movie premiers or events which typically tend to command higher rates.

He further added that the growth in regional space is seeing a double digit in the regions across markets. Talking specifically about the languages that observed a marginal decline in the adex, Tamil and Marathi saw 2 per cent and 9 per cent downfall respectively. Commenting on the same, Kumar said that looking at the longer point of view the ratings of regional channels have only increased steadily over the years and short term ups and downs are expected.

Talking viewership, among all the regional language channels that Viacom18 has, Colors Bangla stood at third position with 74982 impressions ‘000 in the Bengali market according to the BARC data’s week 37. Colors Gujarati secured first position with 29915 impressions ‘000. Colors Kannada also stands at the leadership position with 461396 impressions ‘000. In the Marathi space, Colors Marathi secured second position with 136791 impressions ‘000.

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