Is Zee Telefilms‘ Ltd (ZTL) luck turning? The management must be praying that it will from hereon. The third quarter ended 31 December 2000 has been pretty bad for the firm. And Star Plus‘ shows are gathering in strength and Sony is itching to make a comeback and is planning to totally clean up the weekend with a roster of mouthwatering shows.
Zee TV on its part is gearing up to start airing five new series from next month and the buzz is that these are likely to soak up audiences. If they do, that will only add to Zee TV‘s bottomline in the last quarter of this year and the management‘s prayers could well be answered. If they don‘t well, chairman Subhash Chandra will have a tough ask dragging his company back up a steep hill.

On to its results now. First the nine month period ended 31 December 2000. The consolidated results of Zee Network (including other subsidiary companies) show that it posted a net profit of Rs 1.436 billion - up by only 4 per cent. The reason for the net profit growth slow down has been attributed to lower ad revenue in the third quarter due to severe competition from Star Plus‘ Kaun Banega Crorepati. Total revenues for the period have put up a good show at Rs 7.16 billion - up 24 per cent. A major contributor to this is other income at Rs 379 million which has shot up from Rs 98.6 million in the previous corresponding period. Subscription revenues are at Rs 1.55 billion (Rs 1.37 billion).

The Zee Network‘s consolidated advertising revenues are up only a point in the third quarter to Rs 1.87 billion - in earlier better climes they used to zip ahead at 25 per cent. Subscription revenues have moved ahead by 10 per cent to Rs 523 million from Rs 471.4 million. The total revenue for the quarter is at Rs 2.65 billion - up by 10 per cent.

A huge chunk of its total revenue has been contributed to by other income which rose to Rs 116 million from Rs 32.7 million in the previous corresponding quarter. Earning before interest, tax, depreciation and amortisation (EBITDA) is down 8 per cent to Rs 753 million for the quarter and PAT, went down by 26 per cent to Rs 470 million.

For Zee Telefilms as a standalone entity, PAT is up 29 per cent to Rs 321 million on a 25% increased turnover of Rs 1.133 billion during the quarter. EBITDA is up 35% to Rs 467 million. Again, the growth in the total income as well as bottom line comes from other income which stood at Rs 101 million in the quarter ended December 31, 2000 compared with Rs 28 million in the quarter ended December 31, 1999.

Balaji Telefilms Ltd is developing into a TV production Trojan what with its slate of successful shows on Star Plus and several other channels. Its success graph is headed northward. has registered extremely positive result in the third quarter ending in Dec 2000 with the net profit Rs 34.6 million on the income of RS 178.2 million. The figures of the corresponding quarter of the previous year have not been drawn since the listing requirements were not applicable. When compared with the Last year results FY 2000 and also Half Year 2000 (HY), the performance seems to be pretty good.

Half Year ended in September 2000 saw income of RS 167 million and PAT at RS 30 million. The company manage to attain more than half yearly turnover in the three months period. The Operating Profit Margin was at the same level of 22% with company manage to control Cost of production and telecast fee inspite of more software production. The other cost have also been kept under control which assured the Profit margin.

The Company has repaid all its debts and hence become a debt free company.

During the quarter ended December 31, 2000, the company issued and allotted 28,03,250 equity shares of Rs 10 each for cash at a premium of RS 120 per share, aggregating to Rs. 364.5 million by way of initial public offer. The equity shares of the company have been listed on the Bombay and National Stock Exchange on November 22, 2000. Shareholders are yet to give their nod for the amalgamation of the company with Nine Network Entertainment India Pvt. Ltd. After the merger, the equity share capital of the company will increase to RS 12.903 crore.

What a Knock Out it was! Cinevista promoters Sunil Mehta and Prem Krishen got the shock of their lives after they were told by Prasar Bharati chief R.R. Shah that the game show Knock-Out that the production company was going to produce for DD had been called off. This week they announced that they were taking the state-owned broadcaster to Court and that they had filed a writ petition against its decision to garbage it.
In early December Cinevista had had a high profile announcement that they would be doing the show and veteran cinema actor Kabir Bedi had been signed on to host it. Reams of media coverage had been given to Kabir Bedi and Knock-Out for almost a fortnight. Then there was total silence followed by Shah‘s announcement.

The reason given by DD for dumping the show: its holding company, Prasar Bharati, thought that Knock-Out was all about chance and that meant it was akin to gambling, which was something DD should not be encouraging. The show carried a maximum prize of Rs 10.2 million and had been for one hour every Sunday at 21:00 hrs.

Cinevista says the show was not a commissioned one but belonged in the sponsored category and any losses incurred on it would be its responsibility. Hence DD should not have taken the course of action it has. Mehta and Krishen say they have tried to convince DD to take back its decision with not luck; hence they are taking legal recourse now.

Officials in Star Television and the Zee group affiliated MSO Siti Cable made conflicting statements on Thursday a day after a row over Star‘s channels being blacked out in New Delhi threatened to snowball.

Siti accused Star of trying to cash in on the unprecedented success of its hit gameshow Kaun Banega Crorepati to increase subscription rates and force operators to pay for "unpopular" pay channels like Star Gold and Star World.

"They (Siti) switched us off but we are back on again in most of New Delhi as of yesterday," countered Yash Khanna, head of corporate communications in Star. "Obviously they are feeling some insecurity as Zee TV is expected to go pay soon," he said.

Siti claimed its actions were dictated by customer feedback which said no one was willing to pay for channels they do not view. They also asserted that Star‘s actions were illegal. A Siti Cable group company providing cable services in Noida (a New Delhi suburb) has instituted legal proceedings with the MRTP (Monopolies and Restrictive Trade Practices) Commission, a press release said.

"We are not forcing people to take all channels," explained Khanna. ``StarGold is priced at Rs 5.50 per home per month. But cable operators have a choice to take it or not to take it. Without StarGold, the Star bouquet is priced at Rs 19.25 per home per month, he said. "So where is the question of bringing the MRTPC commission into it."

The major bone of contention is however the issue of paid connectivity. A problem which is bound to keep resurfacing unless a satisfactory conditional access system is introduced.

It was only on Monday that the Star affiliated Hathway Cables had reached a compromise with Sony over the declared paid connectivity of its pay channels SetMax, AXN and CNBC. Sony had switched off the channels in the Mumbai region from 2 January over a similar dispute as the one being witnessed between Siti and Star.

Siti charges that Star has demanded subscription charges on an assumed increase in the subscriber base without any verification or justification.

"We are being paid for just five million subs when the cable TV population in India is over 35 million. The figures speak for themselves," says Khanna.