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INDIA- The Content Distribution Market …
Focus on Indian Film Industry…..
Indian Demographics- Population & Income
Over 55% young population
Of under 30 years!!
Media and Entertainment – The India story
Media and Entertainment – The India story
Update on Indian Film Industry
• The Indian film industry produces around 1,050 films and
sells around 4 billion movie tickets, each year.
• In 2008, the size of the Indian film industry was estimated
to be USD 2.58 billion.
• While the domestic box office collections contributed as
much as 60%, the home entertainment contributed a mere
6% to the total revenues, which is significantly lower as
compared to developed countries.
• US Example:
– There were 610 film releases and a total of 1.4 billion tickets sold in
2008.
– In the same year, the revenues from the film industry were around
USD35 billion, of which the domestic box office contributed 28%
and the largest share of 54% came from the home entertainment
segment.(E&Y,Apr-2009)
Key Catalysts of Growth- Movies at Home
India C&S Market Future Forecast
200
180
166.8
173.3
179.3
183.8
188.5
159.8
152.2
160
Homes in millions
140
144.3
136.3
128.3
120
100
78.5
85.8
93.1
100.1
112.6
106.6
117.8
122.2
125.9
129.8
80
60
40
20
4.8
0.0
45.0
9.8
0.1
40.6
15.0
0.3
35.9
20.9
0.5
26.1
0.8
30.4
33.8
36.2
37.6
39.1
1.1
1.3
1.5
1.6
30.7
26.2
22.7
20.4
19.4
18.6
1.8
17.9
Mar-11
Mar-12
Mar-13
Mar-14
Mar-15
Mar-16
Mar-17
0
Mar-08
Mar-09
Mar-10
Terrestrial
IPTV
DTH
Cable
•Source: Media Partners Asia Report 2007
Film Industry- India Distribution Platforms- Size
Source: KPMG-FICCI report 2009
Size of Indian Film Industry -Revenues
Indian film industry expected to grow at CAGR of 11.2% over next 5 years
[compared to over 15% CAGR growth before economic downturn]
Current size of Indian film industry estimated around Rs 109.2 billion in 2008 which is expected to
grow at a CAGR of 12.2% to reach Rs168.6 billion by 2013.
Source: KPMG-FICCI report 2009
Key characteristics of Indian Film Industry
 Indian film industry is dominated by individual directors and local theatre owners
 Film production in India is characterized by the presence of large number of small
privately held, family‐owned production houses
 Highly fragmented distribution segment
 The country is geographically divided into six territories. There are usually 50‐75
distributors for each territory, while only 8‐10 distributors operate on an all‐India basis.
Distributors generally sell rights to sub‐distributors who cover certain sections in a
territory
 Major impact of digitalization of film prints leading to increase of number of prints in
market on the first day of a movie
 The industry had been deriving approximately 75% of its revenues from domestic
box‐office ticket sales but over the years this is expected to fall in the range of 60%,
while the rest will come from sale of overseas rights , sale of cable and satellite
television rights, home video sales, music sales and in‐cinema product placements
 Foreign direct investment (FDI) of 100% is permitted in all film‐related activities such as
film financing, production, distribution, exhibition and marketing
Key factors in the film industry impacting
the future
 Corporatization of the industry
 Growth in multiplexes
 Digital cinema
 Increasing collections from overseas market
 Co‐production
 Improved models of financing films
 High Growth in home video market
 Increase in marketing spends
 India is in talks with several countries for treaties and agreements in
the domain of entertainment and media
 Varied unique subjects
 Foreign films in India
 Market for niche and Hollywood content
 Improved State of Art post production facilities
THE MEDIA COMPANIES OF HINDUJA GROUP
INDUSIND MEDIA & COMMUNICATIONS LIMITED
(A SUBSIDIARY OF HINDUJA VENTURES LIMITED)
www.hindujagroup.com
May 2009
The Hinduja Group : Introduction
 One of India’s premier transnational conglomerates
 Been in existence for over 90 years
 Present in 10 business sectors
 Present in 32 countries
 Employs over 35,000 personnel
 Major Companies Listed in Stock Exchanges -India
 Turnover of the Group is several billion dollars
The Hinduja Group
Founder- Parmanand D Hinduja
Guiding Principles of the GROUP
“My dharma (duty)
is to work, so I can give”
Work to Give
Word is a
Bond
Act Local;
Think Global
1901-1971
Partnership
for Growth
Advance
Fearlessly
Business Activities
Investment
Banking
Global
Investments
International
Trading
Philanthropic Activities
Worldwide Locations
Hinduja Group in India has a national footprint reaching to over 6 million people through
customers, cable operators, employees, dealers, branches and suppliers of it’s companies
Major Centres and Establishments :
Europe
: London, Paris, Geneva, Moscow, Spain
United States
: New York, Washington
India
: Mumbai, Delhi, Chennai, Bangalore, Hyderabad
Middle East
: Tehran, UAE, Saudi Arabia
South East Asia
: China, Philippines, Jakarta
Africa
: Johannesburg, Cairo, Mauritius
S. America
: Argentina (Buenos Aires)
Hinduja Group – Overview
The Financial Services Group operates amongst the leading banks in
Switzerland and India with specialization in Corporate, Retail, Private
Banking, Trust Services and Merchant Banking
The Global Investments Group has eight investment divisions. Each of
these, in turn, has individual companies within the defined area of
business.
Media &
Communication
Transport
Banking
& Finance
Hinduja Bank (Switzerland) Ltd
Information
Technology
Chemical &
Agricultural
Business
Project
Development
Healthcare
Energy
About us…. In Films…
 A glorious chapter in the history of Indian Cinema, a chapter scripted in the early
years by Hinduja Group’s initiative to finance, trade and distribute movies
globally
 The group tapped and exploited its role as a distributor of Indian films in both
traditional and non-traditional territories. Realizing its role as the cultural
ambassador of India, the Hinduja Group set up Ashoka Co. Ltd. In Iran in 1958
 The first Indian movies to hit the Iranian screens were Raj Kapoor’s Shri 420 and
the Dev Anand’s Baazi. In less than a year, the group set up offices in Istanbul,
Egypt, Bangkok, Tel Aviv, Beirut, Jordan, London, Singapore, Jakarta, Mauritius,
Madagascar to name a few
 Ever the trend-setter, the Hinduja group broke new grounds by adding value to
these movies in the form of dubbing, sub-titling, etc. The group formed a
number of joint ventures with leading distributors globally to enhance the reach
of Indian cinema into the hearts of millions around the world
 Over the years, the Hinduja group associated with the leading Indian film makers
to from partnership that heralded some of the greatest hits to ever hit the Indian
screens. These movies would then transgress geographical boundaries thanks
to the extensive distribution network of this group
 Today Group’s Media Businesses are metamorphosed into “IndusInd Media &
Communications Limited” (IMCL), an integrated media power house with service
offerings in the content, access and commerce segments directly and through
its various subsidiaries.
INDUSIND MEDIA & COMMUNICATIONS LTD.
(Hinduja Group)
The Market: What has changed
Historical Challenges
Changes
•
Under-declaration
Addressability is a reality now .Solves the problem of underdeclaration through the government order that forced the upgradation
of networks & purchase of over 3 million boxes by the MSOs
•
Last mile control
Digital migration & DTH competition are destabilizing forces to the
LCO monopoly. These forces will shift the balance of power in favor of
the MSO
•
Collection
In an addressable environment the utilization of a prepaid model will
eliminate delinquent accounts. This model is a success
•
Funding & Exit
Strategies
An exponential increase in the number and types of institutional
investors interested in India and the switch from traditional asset
backed lending to financing secured by cash flow.
The India Content Distribution Opportunity
 Market and Legislation have changed to enable broadcasters to exploit
content in an organized and transparent manner
 Legacy issues of under -declaration of subscribers, income leakage, lack of
bandwidth, piracy would soon disappear
 Deployment of Digital set Top Boxes, DTH, IPTV etc offers an opportunity for
offering niche/ customized channels to a large and young population
 STBs would pave for services such as Pay per View, Video on demand etc
enabling the broadcasters , film companies and studios to exploit library and
fresh content
IndusInd Media & CommunicationsA Hinduja Ventures Company- (Restructured)
65.81%
Hinduja Group
19.19%
Institutions
15%
Public
Hinduja Ventures
Real Estate, Cash,
Media, New Ventures
IndusInd Media and Communications Ltd. (IMCL)
(Cable TV, Movie Channel, Broadband Internet)
Subsidiaries/Associates
(Planet E Shop,-Shop 24/7-USN, UMN Networks)
New Networks
IndusInd Media & Communications Limited (IMCL)
Effective Shareholding Pattern: IMCL
59%
(ICL-Mauritius)
Hinduja Venture’s effective stake in IMCL:
59% plus 51% of Grant’s 6 % Stake = 63%
IMCL: Divisions and Businesses
INDUSIND MEDIA AND COMMUNICATIONS LTD
Cable TV
Services
Content
Broadband
Internet
Analog Cable
Movie Library Licencing
Internet on cable
Hindi Movie Channel
VOIP/Internet Telephony
Digital Cable
Foreign Channels Aggregation
Planet E Shop Holdings India Ltd.( Associate)
IMCL Platform utilises best technology from global
leaders
Subscriber
Management
System
(SMS)
CAS System
Set top Boxes
Other technology
partners
IMCL has invested in developing a
strong technical foundation partnering
with global cable TV and convergence
leaders like Magna Quest,
NAGRAVISION, Motorola etc. which
provides them a differentiator in quality
and scalability of operations
IMCL ( Incablenet)Today: Assets
Infrastructure in Place:
 Pioneer and leading multi-system Cable & Broadband operator in
India
 Present in 24 cities, of which 15 are main cities , 5 are neighborhood
satellite cities including new expansions in 8 cities. In key cities over 40% market share .
 Only MSO to have extensive intra-city fiber networks
 6,300 km of trunk and access HFC networks—80% of which is 2-way
enabled
 Digital systems implemented in 11 cities and STB box roll out
commenced
 Over 1000 employees
 2,400 affiliated local cable operators—LCO
 LCO averages 6 employees = effective service network 14,440
IMCL – Geography
Network Spread :
24 centres, out of which 15 are main
cities
12 digital Cable cities : Mumbai,
Delhi,Bangalore,Thane,Navi
Mumbai,NOIDA,Ahmedabad, Vadodra,
Fardibad
NEW DELHI
Belgaum, Nagpur,Sholapur and Kolhapur
NOIDA
Estimated subscribers in analogue :
over 6.5 million homes
UDAIPUR
AHMEDABAD
INDORE
Digital Cable subscribers: around
300,000 , Exponential growth expected
when regulations are implemented
SURAT
THANE
MUMBAI
VADODARA
NAGPUR
NASIK AHMEDNAGAR
NAVI MUMBAI
Baramati
BELGAUM
GOA
Gulbarga
BANGALORE
Hyderabad
Nizamabad
Main Cities
New Cities
Satellite Cities
MYSORE
14 Broadband cities
ALLEPY
IMCL Today: Assets
Our Differentiators:
 We own and operate our own head-ends
 We have the largest number of employees
 We have our own technical and field staff
 We design and implement our own plant
 Only MSO with fiber optic infrastructure in our locations
 We operate out of one head with redundancy in almost all locations
Content – TV channels
MOVIE and Thematic In House CHANNELS:
 CVO, the number 1, premier Cable Movie Channel, over 1000 titles
 CVO’s Movie library can be utilized for Digital Cable through PPV
 Indigital Premium Movie channel , which is ad free
 Indigital Music channel ( ad free)
 Indigital Classic Movies Channel ( ad free)
 Multiple Thematic Movie Channels
CHANNEL AGGREGATION:
 IMCL associate (PESHIL) receives permission for down linking Foreign
channels
 Satellite Channels with exclusive tie ups for Marketing and Distribution in INDIA
 ARIRANG TV ( Global English language, Korean Channel)
 MIRACLENET ( English Language Spiritual Channel of USA )
 Radio RNW ( Radio Netherlands) tie up for “Indigital”
 Tie ups and at advanced discussions with more International TV channels and
Content Groups
Foreign Channel Distribution and Marketing
Content - Rights
 Negative Rights - 29 Movies ( including the following):
 Baghbaan- Amitabh/Hema
 Boom-Amitabh/Jackie
 Pitaah- SanjayDutt/Jackie Shroff
 Mard/Coolie/Naseeb/Toofan- Amitabh
 Asia Satellite Rights- 22 Movies
 Cable Rights ( India)- 1000 Movies
Content-Film Financing ,Movie Production/ JVs Film Financing of select movies
 IMCL in association with “Serendipity Films” ( Of “Being Cyrus” Fame)
has commissioned a New Movie – “Teen Patti”
 Starring: Amitabh Bachchan , Sir Ben Kingsley and Madhavan
 Expected Release : July- 2009
 In dialogue with other Directors / Production Houses for new Projects
 Co- Production and JV’s with Studios
 Digital Cinema Distribution opportunities- Satellite based, Broadband
based for National and International
Regulatory- TRAI’s Recent recommendations
on Restructuring of Cable Industry
 Greater emphasis laid on network digitization, increased
addressability and to encourage voluntary CAS
 Incentives prescribed to Multi System Operators (MSOs) to
introduce total digitized networks
 The registration for cable TV operator to be replaced by a
comprehensive and supportive licensing framework
 Separate licensing frameworks for Cable TV operators (LCOs) and
Multi System Operators (MSOs)
 Eligibility criterion made specific to identify the entities who can act
as LCOs and MSOs
 Option and flexibility to choose Service area given both to LCOs
and MSOs
What Media Group can Provide
 Full Management of TV Channels ( uplinked from Abroad) ,including
exclusive rights for Distribution and Marketing in India
 Niche Program Contents for Digital Video (PPV) or utilisation in any
video digital channel of Media Distribution Company
 Feature Films, Documentaries and other content aggregation for digital
distribution
 Distribution of Indian Content in International Markets
 Co-production of Movies National/International
 Tie ups for Main line Distribution of Indian Films overseas with various
Studios/Sales Agents/Distributors
Other Innovative Opportunities in Digital Cable,IPTV platform - India
 Server based city specific channels in India with content aggregation in
Digital Cable platform
 Events and live contents, location wise
 New Movies and niche content which can be utilized in digital platforms
of Cable, IPTV, Mobile TV
Why Partner with IMCL
 We can offer full solution through the use of our platform.
 Guaranteed wide distribution through a well respected distribution
player
 Guaranteed distribution with IMC on our digital tier.
 Packaging options in analogue and digital distribution.
 Nationwide distribution to all platforms ( e.g.: Cable, Terrestrial, DTH, IPTV,
Mobile etc) through Content aggregation Company/Division
 Providing an easy access of new channels, new movies and niche
contents to the Indian market by providing ready made solutions
 Provide statistical information on all digital distribution
 Provide an on-the-ground marketing force to maximize distribution
 Provide ongoing compliance and information for channels and contents
regarding all changes and developments
 Liaisoning and coordinating with all Government and Regulatory
bodies
The best value proposition for operating in the Indian marketplace
Film Distribution – Key Success Parameters
Hinduja Media Group Strategy
Maximize Returns from the Satellite Market:
 With the spurt in the number of Television channels, there is an increase
in demand for movie content
 Players can take advantage of this situation and enter into innovative
arrangements with the channels. PPV’s ,VoDs,PVR’s are all possible in
digital addressable systems
 Digital Cable with addressability has options for launching films citywise
and regional /segment wise
 Instead of sale of satellite rights for a specific period, companies can
enter into revenue arrangements based on number of screenings with
satellite channels
 This way the players need not get tied up for a specific number of years
and also can sell these rights to multiple number of channels.
Film Distribution – Key Success Parameters
Hinduja Media Group Strategy
Focus on Innovative marketing and packaging of content :
 Today the theatrical windows in India are being greatly compressed
 It has now become imperative to package ones product innovatively that
could get the audience into the theaters in the opening week itself and
sustain it self post that with word of mouth and second rung of
promotional activity
 In today’s age of clutter, it is as important to package and present your
product cleverly as much as focusing on the right content
 Companies need to focus on maximizing their revenue from alternate
revenue streams ,mainly on the addressable digital TV distribution
stream
 With the Video on Demand services on Digital Cable, DTH and IPTV
expected to pick up in future, players need to build up a strong and
diverse content library to capitalize on content demand as well as
mitigate their risks.
www.hindujagroup.com
www.hindujaventures.com
Email: [email protected]
[email protected]