This year represents a major leap towards digitisation of access technologies in the country. Established players like Star network are undergoing restructuring; and its expansion into wireless and Internet domain is but the proverbial pebble on the beach. In production, a different kind of excitement is brewing.

While the big budget Hindi movies brought in cheer with their box offi ce receipts, some local companies are signing mega co-production movie deals with Hollywood studios. The TV producers continued to have ample opportunities. Strategic alliances in the animation sector, too, ensured that India sustained its momentum towards co-production treaties.

When the draft of the Broadcasting Services Regulation Bill was announced, broadcasters and their stakeholders have expressed initial concern over the proposed impositions, such as the capping of electronic ventures by cross media holdings to a maximum of 20 per cent. In addition, the bill instructed TV channels to air a prescribed amount of locally produced content, as well as socially aware programs.

Unfazed by all this, it was business as usual for some. Reuters and CNN set the ball rolling by launching their respective 24-hour English news channel ventures in Times Now and CNN-IBN. Times Now is a Times Group and Reuters Service venture, and CNN-IBN is a joint offering from Turner International and Global Broadcast News (GBN). GBN is a TV18 Group company. TV 18 further strengthened its portfolio through its strategic investment in Channel 7, a Hindi news channel, from Jagran TV Pvt Ltd.

Sports and children’s programming are top money spinners

As the year progressed, the industry was galvanized by even bigger news.

Nimbus Communications Limited, a company with a business mix of media, entertainment and sports, decided to enter the sports broadcasting business, scheduling its first of three sports channels under the Neo Sports umbrella brand in October. The international operations of the business are being managed under Nimbus Media Private Limited, which is headquartered in Singapore. The fi rst channel â€" a cricketcentric one â€" will have a footprint that covers a selection of Asian countries apart from India, i.e. Malaysia, Hong Kong, Singapore, Indonesia, Sri Lanka, Bangladesh and the Middle East.

The company invested US$67-68 million during the first phase of the sports broadcasting business. It plans to invest another US$33 million in the second phase. The decision to launch its channels followed Nimbus’ US$612 million four-year deal with the Board of Control for Cricket in India (BCCI) to become the global media rights partner for Indian cricket till March 2010.

Other than cricket, soccer was the other centre of attraction this year. For a country fi xated by cricket, the spurt in FIFA World Cup TV ratings provided a ray of hope for global sporting events.

The FIFA World Cup in Germany not only at t racted audience f rom metropolitan cities like Delhi, Mumbai and Kolkata but also made new fans from non-traditional soccer markets in India.

Apart from the World Cup frenzy, the other buzz in the industry had to do with kid’s programming.

The Walt Disney Company entered into an agreement to acquire 100 per cent of United Home Entertainment Ltd. (Hungama TV kids channel) at an enterprise valuation of US$30.5 million and purchase equity stake of 14.9 percent of expanded capital in UTV Software Communications Ltd. at a consideration of US$14 million, for a total combined investment of US$44.5 million.

Walt Disney integrated Hungama TV â€" positioned as India’s fi rst locally produced 24-hour entertainment channel for kids â€" into its existing portfolio of Disney Channel, and Toon Disney/Jetix.

Internal affairs

In the broadcasting sector, management and operational issues continue to hog the industry headlines.

Star led the way with the segregation of its Indian operations into two units â€" Star Group and Star Entertainment. Peter Mukerjea leads Star Group in India as its chief executive offi cer, and is responsible for all corporate functions such as legal, finance, government affairs, corporate communications as well as managing Star’s investments including Tata Sky, Hathway, Balaji and MCCS and leading the development of new business opportunities in India. Sameer Nair was promoted to chief executive officer, Star Entertainment, overseeing all day-to-day operations including programming, marketing, advertising sales and distribution while pursuing growth opportunities in new media including wireless and Internet.

In Sony Entertainment Television (SET) India, Rohit Gupta, executive vice president, ad sales and revenue management, was given additional responsibility of Digital, Licensing and Telephony group.

Apart from expansion in the operations of major broadcasters, other development was related to new access technologies in home entertainment.

In a much-awaited move, Tata Sky Ltd. launched its Tata Sky satellite television service across 300 cities in August.

The company, an 80:20 joint venture between Tata Group and Star, priced hardware for US$67 and a special introductory offer of US$4.4 per month for channels including those from Star, Sony, Discovery, Disney, ESS, NGC, TV Today, NDTV etc.

Tata Sky set up a pan-India distribution network of consumer electronic stores and mobile phone outlets for retailing its hardware and prepaid recharge vouchers. The company tied up with LG, ITC International Business Division and Indian Oil Corporation as part of its distribution drive.

By launching its DTH service, Tata Sky has emerged as the main competitor to Essel Group’s Dish TV, India’s first DTH satellite television service provider. On its part, Dish TV, which started its service in 2003, achieved a major breakthrough this year in terms of carriage deals with Star India and Sony Discovery JV One Alliance channels. Dish TV also entered into an agreement with Buena Vista International Television - Asia Pacifi c (BVITV-AP) to air movies on its value added service, Movie on Demand.

After acquiring 1.2 million users, the company is expected to stretch its base to fi ve million in the next three years. Overall, the Essel Group expects the penetration of digital STBs in the Indian market to grow to 12 million in the next five years.

Gearing up for new media

State-run DD Direct’s has around 4.5 million subscribers, offering a free-to-air DTH service. The other players expected to be in the fray are Sun TV and Reliance Communications.

Apart from DTH, conditional access system (CAS) was back in the news. The Minist ry of Informat ion and Broadcasting issued a notification for the implementation of CAS in the notified areas by 31 December, 2006. The areas include Delhi, Mumbai and Kolkata.

Meanwhile, multi-system operators (MSOs) have been keeping busy digitizing their entire network. The set top box is being offered on easy payment basis, like rental and equated monthly installments. The MSOs are also pushing broadband Internet, offering digital cable TV services and Internet as a package service.

In IPTV, state-run telecom companies including Mahanagar Telephone Nigam Ltd (MTNL) are gearing up for the next leap. MTNL is expected to be the first to go live with IPTV and VOD, with a launch likely in Mumbai and Delhi by January 2007.

In terms of content offered on mobile phones, there were tie-ups between broadcasters and mobi le service providers. For example, in June 2006, Reliance Communications tied up with Disney to offer on Reliance Mobile World, “what would be India’s first 3d animation on mobile”. Users were provided access 16 Disney animated video shor ts, including ten in 3d, exclusively made for mobile devices and featuring Disney characters.

Star India shared its plans for a large mobile content mall, to be a one-stop shop for mobile entertainment and information. Star announced a slew of initiatives to enhance its Star7827 offering, expanding its services from television-focused interactivity to entertainment specially created and aggregated for the mobile screen. Its website www.star7827.com was redesigned to refl ect the new push in content aggregation.

The emergence of multiple delivery platforms across media like internet, wireless, DTH and broadband will also fuel the demand for specialised content created for each specific delivery platform.

The demand for original content also provided enough space for TV format owners, distribution and production companies.

What’s on TV?

Endemol, which launched its operations in India this year, joined hands with FMCG company Hindustan Lever Limited (HLL) and Hindi general entertainment channel Star Plus for a kids reality talent show Rin Mera Star Super Star. Star India said this was the channel’s first show of this scale, focusing on strategic brand solutions.

Apart from Star Plus, Star One and Sony Entertainment Television, Endemol also tied up with SaharaOne Television, for a talent hunt reality show Super Stars. The show is an adapted version of Soundmix and Stars in Their Eyes aired in Europe.

Fact Based Communications (FBC) Bunim-Murray Productions, with their pact including a co-production and distribution deal where FBC India, FBC’s Indian television and media subsidiary, to co-produce Bunim-Murray’s formats in India. The initial phase of this deal will also include plans to localise the hit reality show The Scholar for Hindilanguage broadcast in India. FBC created its own homegrown adventure reality format Paisa Bhari Padega for the Sony Entertainment.

Among local companies, Miditech and Strix Television AB signed a production and licencing agreement, whereby Miditech will have exclusive Indian licensing and production rights to the entire STRIX format catalogue in India.

Other than association with entertainment channels for shows like Extreme Makeover, Miditech also co-produced Galli Galli Sim Sim, the Indian version of Sesame Street, with Turner International India and Sesame Workshop. Miditech was also chosen by UK-based Investors In Cricket (IIC) for a cricket-based reality TV show Cricket Star.

The Hollywood connections

The Indian motion pictures industry showed signs of going beyond Indian audience worldwide. UTV and Adlabs opted to co-produce movies along with major studios from Hollywood. Adlabs inked a five-year deal with LA-based Hyde Park Entertainment for its foray into Hollywood.

UTV and Fox Searchlight signed a co-production deal on the fi lm I think I love my wife, with plans to release the fi lm in the US in February next year. The $14 million production is UTV’s second venture with Fox after `The Namesake’ directed by Mira Nair, which will be released in March 2007.

UTV has also inked a co-production agreement worth $30 million, with actor producer Will Smith and his production company Overbrook Entertainment and Sony Pictures Entertainment, for films to be created and distributed worldwide. The fi rst two projects will be a live-action fi lm valued at US$10 million and a CG animated motion picture at US$ 20 million. UTV and Overbrook will co-produce the movies while SPE will distribute the movies worldwide, excluding India.

UTV’s animation company UTV Toons invested in a brand new animation facility with 225 workstations replete with blade render farms and Max sof tware, at its Andheri Studio in February. UTV also entered into animat ion deals total aggregating to US$14 million. It signed a co-production with PorchLight Entertainment to produce the fi rst Jay Jay feature-length animated movie, Jay Jay’s Race Around The World. The movie is slated for release in the fourth quarter of 2007. It also signed a co-production deal with Los Angeles-based Mike Young Productions’ distribution arm Taffy Entertainment and Method Film, France for TV series ‘Cosmic Quantum Ray’ and an animation services deal for 13 hours of a combination of direct to DVD titles and TV episodes in 3D animation.

Mumbai-based K Sera Sera shared plans to produce more than 20 movies, to be released by end-March 2008, at a total outlay in excess of US$55 million.

Among others, Indian company DQ Entertainment Ltd (DQE) formed a joint venture with France’s Onyx Films (OF) to produce CGI feature films. The proposed joint venture between DQE and OF has identified three feature films valued at US$89.5 million. DQE also decided to buy a strategic stake of up to 20 percent in the France-based TV production company Method Films (MF).

The strategic alliance trend seemed

to have emerged in the post production

industry as well.

Prime Focus Limited, a Mumbai-based integrated end-to-end post production and visual effects services house, is focusing on geographical expansion. The company is in the middle of charting out a mix of inorganic and organic growth in key markets across the US, Europe and the Middle East. To attain this, Prime Focus came up with a US$26 million initial public offer (IPO). The company also acquired 55 percent stake in Europe’s VTR Group for £4.7 million. Other plans include setting up a digital, post-production visual effects studio in Hyderabad.

Work-wise, the studios continued to break new barriers. Prasad EFX handled more than 1400 shots that required digital manipulation in Hindi movie Krrish, a movie with a futuristic concept and the protagonist endowed with super natural powers. The studio executed a very high-end 3D modeling and animation including whole body scans. Because of the sheer volume of visual effects layers in this sequence, color timing became critical and required high level of precision. The DI was completed in around six-eight weeks.

As for future projections, the post production industry looks bullish being tipped to double its size to US$227 million by 2007.

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