Press Release

Star India’s Uday Shankar On India’s Competitive Channels Business

19 April 2016

NEW YORK: Uday Shankar, CEO of STAR India, tells TV AsiaPac about what’s driving the gains at the 21st Century Fox-owned business.
TV ASIAPAC: How are you fostering talent in order to innovate your programming lineup?SHANKAR: We have focused and invested in a big way in talent development, both creative talent and business talent. We’ve always been very eclectic about taking the best talent from all parts of Indian society. We have developed writers, directors and producers for television. We’ve also [worked with] more Hindi and regional film talent than any other company, starting with Amitabh Bachchan 15, 16 years ago, then Shah Rukh Khan, Aamir Khan, Hrithik Roshan and Akshay Kumar. So we’ve been very eclectic with in-house and external talent development and engagement.
TV ASIAPAC: What’s been the strategy for the sports business?SHANKAR: Starting years ago in partnership with ESPN, STAR Sports set out to reinvent the sports experience, and we did that very successfully with cricket. And after that, for one reason or another, it plateaued a bit. We realized that required a very deep disruption and we decided to take charge of our own sports business. We made a big plunge. We decided to showcase the 4K experience for people last year. It was ahead of its time. With initiatives like the Indian Soccer League and the Kabaddi League and the Hockey India League, we made a big dramatic leap from being a one-sport country—the widely held wisdom [was that viewers would only watch cricket].
TV ASIAPAC: How do you stay competitive in a business where the cost of sports rights continues to escalate?SHANKAR: Most broadcasters have taken the easy way out by just bidding very aggressively for the well-developed sports rights. We’ve bid very aggressively for some of the cricket rights we have, like ICC. However, we are not shying away from the hard work. We are using [the major events] as a beachhead. We’re building a platform populated by a large number of other sports tournaments that are not expensive but take an enormous amount of hard work to build. We’ll be in a position where we’ll have a bunch of popular sports that are not very expensive and are ready to scale up. That’s a good place to be. When we were going into sports, we had two choices: either we made the same beeline for IPL, BCCI, ICC and other international cricket rights, and stayed limited to that, or we took some of those rights and used them to drive the larger sports development agenda. We opted for the latter.
TV ASIAPAC: How are you managing the acquisition of Bollywood titles, and how important are they to your schedules?SHANKAR: Movies are important. Movies are a good driver for sampling, they bring variety, they’re good for appealing to male and younger target groups. We [saw that] once a movie was produced and it was out in the market, the prices were going berserk. It was a bidding war among various broadcasters. That’s why we decided to take a step back from that marketplace and we said, We will do a few output deals of a sort. But rather than doing those output deals with studios, where you get a blanket slate, we went to some of the most bankable stars and did back-end deals with them. We did one with Salman Khan, arguably the biggest Bollywood star around, and one with Ajay Devgan. So in the last few years, every movie these guys have done has come to us at predetermined prices. They get dedicated buyers and we get clarity of costs. On top of that we built our own studio. FOX Star Studios is in partnership with our sister company 20th Century Fox. It was created to produce Indian-language films. We just released Neerja, and it’s been making waves everywhere. So we’re bullish on movies, but we’re being thoughtful and calibrated with how we make sure we get a reasonable supply without breaking the bank.
TV ASIAPAC: I interviewed Priyanka Chopra last year and she was super excited that Quantico was coming to India on STAR, day-and-date with the American telecast. How important is imported Hollywood content for your portfolio?SHANKAR: It’s a small universe, but a very evolved universe of people who have the most refined taste in global content. They watch Hollywood drama. It’s a small base but a very committed and dedicated audience. For almost 20 years now, when it comes to Hollywood films and drama, we have been the default destination and we have consistently built on that. Starting with STAR World and STAR Movies, we launched STAR World Premiere, which is a unique experiment where we got the top American dramas from three or four of the biggest Hollywood studios, on the same day they’re released in the U.S. Usually there’s been a big gap. We realized this was an audience that had become so global that even a few days late for them was going to make them impatient. We also realized that was the root cause for a lot of piracy. So by doing day-and-date releases of top Hollywood drama, we actually delivered a blow to piracy in this part of the world. A few months ago we launched STAR Movies Select, which is the only destination in this country for high-concept, high-quality stories. The reception has been great. [It reflects our strategy of] staying ahead of the curve in anticipating and identifying audience taste and delivering on that disruptively.
I think Priyanka has been an amazing brand ambassador. While there’s been a lot of affinity for Hollywood drama, it did require a second wind. That’s exactly what Priyanka Chopra has provided through her performance in Quantico. It was not one of those marginal roles that Indian audiences have come to expect from their stars. She is central to the story, she is the lead character, she’s done very well and she’s got international recognition. In terms of what Hollywood drama can do in India, Quantico takes it to the next level. One of “our own” is driving a big-ticket show in the U.S. That has the potential of taking Holly­wood drama to audience segments where it would normally not have gone.
TV ASIAPAC: Tell me about hotstar—what did you want to achieve with it, and what’s driven its success?SHANKAR: For the longest time we were told by everybody, in India and elsewhere, that this was a market that was digitally handicapped. Broadband was rickety and it was expensive; WiFi was not pervasive enough. But we were seeing all this data about pirated video and YouTube and other video destinations that were [gaining] a lot of traction. We felt that if we had high-quality content that appealed to the audiences that spent a lot of time on the internet and on handheld devices, it was a good idea to start offering it to them. This combination of high-quality drama in multiple languages, lots of compelling sports and a lot of big-ticket movies has been the driving force [for hotstar’s popularity]. On top of that, the one thing that has become part of our muscle memory is the viewer experience. We do it on TV. All things being equal, people will go for a better-quality viewing experience. hotstar is one of the most highly evolved content platforms, designed for ease of use and a very enriching experience. In the first year we’ve had about 48 to 50 million app downloads. That is a very large number. As data services become more robust and WiFi becomes more ubiquitous, the power of that platform will grow. We’re seeing that every day. We were very conscious about the fact that while we understood television well, digital was not a business that we understood intuitively. We worked with some of the top engineering and technology companies. We also used that time to develop a very high-quality product and technology talent pool internally. That’s paying off. It’s still early days. For all the positive reviews, hotstar is still just a year old. But it’s extremely encouraging and we have once again created a milestone for the rest of the creative industry to aspire to.
TV ASIAPAC: In India’s crowded and competitive channels business, how has STAR kept its lead over the years?SHANKAR: As you said, it is a very crowded space. It is still experiencing a fair degree of volatility; the marketplace is not really settled.
The consistent thread that has run through our entire journey is an attempt to disrupt and reinvent each part of the television ecosystem for the viewer as well as for the advertisers and distributors.
What helped us first create the leadership and then consistently build and strengthen it was being ahead of the curve on disruptions in every sense, in every aspect of the business. Well before anybody else, STAR understood the value of creative disruption and innovation. We’ve been very clear that you need to innovate on a daily basis and every now and then, every few years, you have to do big, visible disruptions in the creative space. Look at the last 15 years or so—the first time STAR became the leader in this [Indian general-entertainment space], the conventional wisdom was that the value [for pay TV] was in English-language broadcasting, because premium audiences were all watching in English. STAR decided to go totally in Hindi and launch STAR Plus. When most people were doing once-a-week shows, STAR decided to do shows four and then five days a week. When everybody thought you should invest as little as you could to create content, STAR decided to turn that wisdom on its head and say, no, you need to improve the viewers’ experience and invest a great deal more in the quality of the visual experience and the quality of the storytelling. That process has not stopped.
Since the ’90s, if there is one business that has actually been the flag-bearer of the liberal economic growth in this country, it has been STAR. We created the first consistent, widely distributed, deeply entrenched platform for reaching out to the emerging Indian middle class. And we have continued to build on that year-on-year. The first few years we dove very deeply into the Hindi-language market. Then we decided that the economic-growth agenda was moving way beyond [Hindi-speaking states] and we began the regional initiative in Bengal, Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Maharashtra. We were the first group to legitimately claim to have created a pan-Indian business in the truest sense of the term. In each market, the same creative-disruption agenda has been played out. Similarly, we’ve been making sure that the best-in-class advertisers are introduced to every market and they gain value building reach and distribution. And in the same way we introduced a quality satellite-television experience, we introduced a high-quality visual and sound experience through HD and Dolby in this country.
TV ASIAPAC: How has the Indian ad market been over the last year?SHANKAR: Amid the general gloom-and-doom scenario the world over, where people are either worried about an economic slowdown or the incursions from digital platforms, India continues to be the one market where television is growing at a healthy clip. We’re talking about a compound annual growth rate north of 15 percent year-on-year. If everybody was focused on expanding the advertising universe by going to emerging advertisers and giving them the experience of TV, and if the economy picks up, then that 15 percent number could get even better. The big national brands have been actively supported by tele­vision. [Indian consumer brands] like Nirma and Ghari and Amul were created on TV. They were great companies with great products, but the brands were built on television. The next phase of that is due [with companies new to TV advertising].
TV ASIAPAC: Looking ahead, what are the biggest challenges for the Indian channels space? And where do you see potential for growth?SHANKAR: When you’ve grown like this for the last 15, 20 years, the challenge is, how do you continue to compete with yourself? We have always set our own agenda, competed with ourselves and excelled against ourselves. So how do we continue to do that? Second, digital is bringing in a very different set of consumers—younger consumers, who are far more interested in range and diversity and quality. Global players like Netflix are coming to India. How do we up the game and continue the creative disruption that we’ve done all this time? The third thing is, we have many irons in the fire, whether it’s building [sports coverage of] kabaddi or football or [the OTT platform] hotstar and taking them to the next level. The next year or two will be a period of solid consolidation. We’ll strengthen our initiatives, maximize the value from them and make sure that we build on the market share that we’ve created.
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