The broadcast subscription side of Media & Entertainment Industry alone has the potential to grow ten-fold to Rs 300,000 crore a year, provided it moves from a pre-liberalization mindset of price control to free market, addressed Sanjay Gupta, COO, Star India, to an audience of M&E professionals at FICCI Frames 2015. He was speaking at ‘Vision 2020 – laying a transformative roadmap for Indian Broadcasting’ with other leaders from the M&E industry and MIB and TRAI in a thought-provoking discussion moderated by celebrated media writer Vanita Kohli Khandekar.
Even as the FICCI-KPMG Indian Media & Entertainment Industry Report 2015 revealed that the total industry had grown to Rs. 102,600 crore in calendar year 2014, Gupta said that the true value of the industry is far from being unlocked.
“All broadcasters are creating as much as 100,000 hours of fresh content each year, engaging 700 million consumers in this country, which is not a small number,” Gupta said, “but what are people paying for consuming all of this content? Around Rs 30,000 crores a year. See how that compares to a simple market like soaps and detergents, for which people are paying Rs. 100,000 crore a year in India!”
He raised the question on how big this industry can be: “I believe it (broadcast subscription) can be Rs. 300,000 crore, instead of Rs. 30,000 crore. How do we get this to happen?”
“The fundamental issue is that we have regulated this industry from a very wrong perspective.” He brought in the example of Telecom industry which has shown dramatic growth in the last 10 years – from 40 million subscribers to 900 million subscribers and from an $8Bn to a $100Bn – on the back of de-regulation and players themselves taking measures to benefit consumers.
Citing glaring and illogical price disparities in media, Gupta said: “We charge Rs.10 for Star Plus, which caters to a very large consumer base; for Star World, where only a small set of consumers watch English content, the price is Rs 2.5! It is ironic that in India the pricing for premium content is less. Another example – in Kerala, we had priced Asianet, the No.1 channel in that market, at Rs. 5.35 and the regulator asked us to take out that extra 0.35 paise! I don’t know what the right price should be, but let the market determine that.”
Explaining how pricing is still genre-based and not driven by nature of content, he said: “In sports, despite the big difference in costs between World Cup cricket, which possibly everyone is watching, and UFC – which many would not have even heard of – the pricing remains the same!”