Star Sports gets support but ban continues
The battle between Mumbai's cable operators and ESPN-Star Sports is entering another phase. Cable operators are believed to have met the information & broadcasting minister Arun Jaitley yesterday presenting to him their grouses against the sports services and how the contracts drawn up by them are totally one-sided. Jaitley is believed to have heard them out. One will have to wait and watch how Jaitley will react.
ESPN-Star Sports meanwhile has received support from the Indian Broadcasting Foundation, a representative body of television channels, programmers, producers, advertisers and marketers, and the Cable Operators Federation of India (COFI), a representative body of cable operators. The two have condemned the initiative by cable operators to black out the two sports services following a hike in subscription rates by Star Sports.
IBF president and Prasar Bharati CEO Rajiv Ratna Shah says: "Pay TV is going to be the norm for the future. Television programming being a very expensive proposition, the channels need more than one revenue stream besides advertising, subscription fees too may be necessary. That's how the television industry has evolved around the world and India is no exception."
He added, "Just as newspapers, the television channels cannot survive on advertising revenues alone. Newspaper prices average about 50-120 rupees per month today whereas the channels charge only about 3 - 8 rupees per month. The pay TV charges in India are among the lowest in the world. The subscriber fee set by each channel is a business decision it has to make, and must take into account the market conditions. We therefore do not favour pressure tactics adopted by some persons, including black-out of some channels by a few cable operators from Mumbai."
COFI has on its part also condemned the mixing of politics with business. "Often the modus operandi used by politicians or their relatives is to divide the cable operators on political ground and present to the government that certain issues be resolved which may give them personal benefits and avoiding the main issues that have adversely affecting the industry since last 10 years." COFI has also frowned upon the practice of politicians who have been forcibly taking over networks from small operators using the cover of friends and relatives.
ESPN Software India managing director Manu Sawhney's has also warned cable operators that they are legally bound to show ESPN and Star Sports on their networks as they have signed contracts to that effect. to the cable operators Says Sawhney, "The television viewers are being deprived by the cable operators of watching the exciting cricket series on ESPN and STAR Sports. This is in complete violation of the agreements that they have signed with us under which they are contractually and legally bound to provide the ESPN and STAR Sports services to the consumers of the cable network for reception by their subscribers".
Meanwhile cable operators do not seem to be affected by the furore they have created by imposing the ban. There were no signs of ESPN and Star Sports making a come back on to TV screens in Mumbai as the ban entered its second week. Viewers in Mumbai have tuned into Sony Max which has been airing the youth World Cup tournament from Colombo. And hence they have not been raising a stink. This apart the Indian cricket team has been putting up a good enough show to make viewers believe that they are missing out on a good thing.
Consumer society frowns upon agitating Mumbai cable ops
The faceoff between ESPN-Star Sports and Mumbai's cable TV trade continues as cable operators are adamant that they will continue to hold their ground and are preparing a delegation to visit information and broadcasting minister Arun Jaitley in Delhi.
Now, it is the turn of the The Consumer Guidance Society of India (CGSI) to throw its hat into the ring. It has issued a press release saying that it "has received many complaints from television viewers against cable operators, where the cable operators are depriving millions of cricket lovers in Mumbai of the television coverage of triangular series being played between India, Pakistan and Australia."
The CGSI says it wholly condemns the cable operators agitation and has decided to initiate immediate legal action against the cable operators and their associations. "We believe this is totally unfair to hold the consumers to ransom where hundreds of thousands of sports enthusiasts are missing out on the exciting cricket series." "The cable operators charge RS 100 - 150 from the consumers and they do not have any legal right to block out the channels. By doing so they are in the breach of their obligations to the consumers. We plan to initiate action against the operators under the Consumer Protection Act."
CGSI has also decided to focus on protecting consumer rights against cable operators in the following key areas. It also plans to educate consumers about their rights against the cable operators, and also take up the issues with the Information and Broadcasting Ministry, the Government and appropriate authorities where adequate regulation should safeguard consumers 'interests.'
The CGSI points out to the following deficiencies:
1) Most of the cable operators do not specify which channels they will show and on what frequency band. A consumer has no recourse to file a complaint at any appropriate forum. The operators also do not give a receipt of monthly subscriptions they receive from consumers.
2) Cable operators have formed service monopolies in all areas. Today in most areas the consumers do not have a choice to get the service from any other cable operator. The CGSI intends to take up the matter with MRPTC as this monopolistic practice violates the basic rights of the consumer.
3) Many cable networks are passing on a very poor quality picture and sound to their consumers. There is absolutely no feedback, no action, no technical up-gradation despite making several complaints to cable operators.
4) Adult movies along with offensive material is regularly shown on the cable operators' channels. This practice is illegal, and is also affecting young minds, and disturbing the social fabric of our culture and traditions.
Mumbai Cable ops continue to do battle with ESPN-Star
The battle between ESPN-Star Sports has entered another phase. On 24 January cable TV operators in cable TV capital Mumbai extended their agitation against basic subscription channels ESPN and Star Sports. That too at a time when India is expected to play a crucial match against Pakistan as part of the one-day series in Australia on 25 January. Cable operators have been protesting the RS 1.51 hike per subscriber to RS 6.50 that ESPN Software management imposed on them to continue to redistribute sports channels Star Sports to subscribers from last week. They had decided to black out the two channels for three days last week. When the three day period expired last week they took a decision to extend the ban indefinitely.
"They are treating us shoddily and at gun point," says Atul Saraf one of the agitating cable operators. "The contract they have made us sign to renew telecasting the service is pretty tough and one-sided. Hence we have decided to fight."
This time they have got the support of a BJP politician Kirit Somaiya who has a vested interest in the agitation as people close to him have been switched off by ESPN Software on account of non-payment for the basic subscription channel. Somaiya is taking the fractious cable TV operators as part of a delegation to the information and broadcasting minister Arun Jaitley in Delhi to air their grievances.
The cable ops are also giving the entire issue a foreign invasion slant by saying that the price hikes are being resorted to mainly by multinational channels who are out to make pots of unwarranted money out of lay Indian consumers just because they have rights to cricket which Indian viewers simply cannot do without.
Star Sports says that the price hike was part of the contract that the cable TV ops had signed with the channel. It says it will not bow down to the arm twisting methods of the cable operators. And they will wait it out.
Cable operators say that it sure is going to be a long wait. "We have taken away the ESPN and Star Sports decoders from cable operators who we believe will give in to the bad tactics of ESPN-Star early," says Saraf. "We are going to fight till the end." Cable operators involved in the battle in Mumbai include Shri Bhawani, InCablenet, Siticable, Seven Star, Channel III, Five Star, Hathway, accounting for almost all of the city's cable and satellite homes.
Who will blink first? Cable ops or the two channels? Whoever does will end up benefiting the TV viewer.
ESPN clarifies black out on cable TV
With cable operators in Mumbai taking a decision to pull the plug on ESPN-Star Sports for three days, the ESPN Software India management has issued a press release expressing its regretting "the decision of a few cable operators, to deprive the cricket loving people of Mumbai of the two on-going triangular series in Australia and South Africa."
The company has also clarified its position on the rate hike: it says that the per subscriber fee for Star Sports was raised by RS 1.51 effectively making the price RS 6.50 per sub effective 1 January 2000. The channel's management claims that "most of the cable networks in Mumbai, including Hinduja-owned In Cablenet, Siticable, Raheja-owned UCN, Spacevision and Liberty, Seven Star, Channel 3 among others have agreed to or have already paid for the Star Sports service at the new price."
It adds that it is "is unfortunate that with this decision of a few cable operators, viewers in Mumbai are missing out on the India-Australia-Pakistan triangular series from Australia being featured on ESPN and Star Sports, as well as the South Africa-England-Zimbabwe triangular series being featured on Star Sports." Cable operators had last week met up in Mumbai in the presence of a prominent politician and taken a decision to switch off the two channels.
ESPN, Star Sports targeted by the Mumbai cable community
ESPN-Star Sports is facing a bit of a hiccup in Mumbai. The reason: Brisca, an association of leading Mumbai cable operators, has started an agitation against what it terms the "bullying tactics of pay services such as ESPN-Star Sports, which raise subscripion rates when they deem fit before important events, blackmailing them and causing differences between the cable community."
They met at Mumbai's Chembur Gymkhana on 21 January to protest against pay channels. The meet was attended by Mumbai's cable bosses and was headed by Kirit Somaiya, MP Lok Sabha.
At the meeting, cable operators decided to black out ESPN and Star Sports for the next three days and it was followed by a protest march to the Star TV office at Andheri in Mumbai, which lasted for just 15 minutes.
Additionally, the operators are demanding a written apology from the two channels' managements and they have sought a legal status for the cable TV industry requesting Somaiya to work out a mechanism to have the so-called bullying stopped.
The operators have also decided to add to the gaggle of cable TV associations by proposing to form the 'All India Cable Operator Association.' Other issues such as royalty, hike in royalty, indifferential package of pay channels, status of cable operators, foreign exchange outgo, video rights, advertising revenues and entertainment tax were also raised.
They pointed out that the television business was taking a cue from the consumer goods sector where foreigners are taking it over piece by piece. And that the turf of domestic and local industry should be protected.
One will have to wait and watch how long this so-called show of unity by the much-fragmented cable TV trade will last.
Kid Power!
January 18-19 saw a major seminar happening in Mumbai. Indian and international marketing gurus met and discussed how to make children watch more TV and spend more on consumer goods.
Aptly called "Kid Power-India 2000," and co-sponsored by the three major children's services in India -Kermit, Cartoon Network and Nickelodeon - the seminar had all the big names in the television industry as well as those from advertising agencies and consumer goods companies, addressing the children's market, discussing strategies and ideas on how kids can be one of the biggest and most powerful consumers grouping of them all.
Statistics show that children between the age group of 4-13 years constitute almost 30% of India's population which roughly translates into a population of 400 million. It is also a known fact that children influence the family-decision making process.
In the light of these facts the big brains sat together, made presentations and studied the psyche of their potential consumers, discussed strategies such as cross-promotion, outdoor marketing, online marketing, special programmes for the children in the rural areas and many more such innovative and interesting concepts to reach out to this huge market segment.
Star TV restructures top management
In order to ensure complete integration of various divisions of Star Network and facilitate the growth of the channel's new business ventures fresh recruitments to senior levels and promotions amongst its top executives have been made.
The CEO Star TV, Peter Mukerjea has integrated Entertainment, Corporate, DTH & News divisions which had been functioning as independent units into one consolidated business unit.
*DTH has been integrated with Distribution and will comprise of urban, rural and international activity. This will be headed by Mr Arun Mohan who will be the Executive Vice President.
*Mrs Indira Mansingh, Executive Vice President will continue as head of News and Current Affairs.
*Mr Jagdish Kumar will oversee Human Resources, Legal, BO&E, Administration and New Business Development as Executive Vice President.
*Mr Sameer Nair, Senior Vice President will continue as head of Programming Star Movies and Star Plus.
*Mr Sumantra Dutta, Senior Vice President will be responsible for Ad Sales and marketing functions for Star Plus and national Geographic Channel.
*L S Nayak, Senior Vice president will be responsible for the same for Star World, Star News, Channel V and Star Movies.
*Mr Shankar Narayan, Chief Financial Officer will direct Finance and MIS functions.
*Mr Yash Khanna wll head the Corporate Communications and will be the Official Spokesman for Star TV.
*Mrs Urmila Gupta, Executive Director will work with the CEO on various investment opportunities and work on strategic planning.
Peter Mukerjea said, "We have some of the best people in business and certainly the best brands so we need to leverage that in every possible way."
NRI or Foreign? Zee pulls out of FM race
The Subhash Chandra owned Zee Telefilms has again landed into equity problems.
First it was the earth station at Noida where Zee had planned to uplink it's television channels. The proposal is still pending before the Information and Broadcasting Ministry. The issue is the same; whether the NRI equity should be considered as foreign equity. The Finance Ministry is still considering that aspect. Zee Telefilms is still awaiting the Government decision on the same.
This time it is the FM sector whire Zee Telefilms was bidding. The Government of India is treating the NRI equity in Zee Telefilms which amounts to 60% as foreign equity. This has put off India's media Mughol Subhash Chandra who has decided to pull out of the FM fray.
However, another venture of Chandra, New Media would still be in the fray.
Nimbus to spread its tentacles
Nimbus Communications is on an expansion spree and has set aside RS 2 billion for this purpose. As part of the expansion plan Nimbus will be airing two satellite channels, will launch a set of portals is a JV with IDBI and will be launching new TV software production facilities. To fund all these projects Nimbus would be coming out with an IPO of 30% of its equity.
One of the channels would be called Showbiz TV. The channel, as one can guess form the name, would primarily be an entertainment channel. The channel would focus on news relating to films, stars, events and general entertainment. The second channel is likely to be a channel devoted exclusively to women audience.
The two portals which the company is planning to set in a joint venture with IDBI would be focusing on entertainment and e-commerce. The brandname given to this venture is nirvanazone.com.
In addition to the new ventures the company would also be spending RS 900 million to expand its current operations like software production, media marketing and airtime sales.
Four regional channels to be launched
The Rathikant Basu promoted Broadcast India has planned to launch four encrypted regional channels--Bangla, Punjabi, Gujarati and Marathi. The channels are expected to be on air within the next six months through Insat 2E. The company is under negotiations with Videsh Sanchar Nigam Limited (VSNL) for uplinking.
Broadcast India is also in the process of content creation for their forthcoming Internet project. The company also has plans to get in the radio market once the Government reviews its policies.
Murdoch owned News Corporation has a 5 per cent stake in the company which be raised only till 20 per cent as per the Government regulations.
Basu has pumped in RS 1200 million for the regional channel venture and the leading consulting firm Arthur Anderson will work on the business plan. Venture capital funding will be seeked by Basu.
The regional channels will be a part of the Star TV bouquet following the distribution agreement with Star TV.
Infosys: India's most admired company
Infosys tecnologies was voted the most admired company according to a survey conducted by The Economic Times. Infosys beat heavyweights such as Hindustan Lever, Reliance Industries, Larsen & Tubro and Ranbaxy by a huge margin. The companies were rated on the basis of five most important attributes that drive admiration in the top performers: maintaining healthy profitability, enhancing shareholder value, responsiveness to customer needs, delivering products and services of high quality and the ability to thrive in a competitive environment. Infosys was the clear winner after being rated first in all these categories. HLL is at number 2 and Wipro at number 3.
Runner up HLL is number 2 in the areas of profitability, shareholder value and in its ability to thrive in a competitive environment. RIL is ranked third in terms of profitability, Satyam gets the same rank for enhancing shareholder value and Pepsi for its ability to thrive despite competition. Surprisingly, Wipro doesn't figure in the top three on any of the five attributes.
Kermit Channel's K2K plans for Y2K
The 40 year old Kermit Channel which entered India in 1999 has drawn up strategies for the year 2000. The Jim Henson Company's and Hallmark Entertainment Television's joint venture has drawn up a campaign which will be called "K2K" to design a creative platform to introduce viewers to the new programming that will be shortly premiered on the channel and to provide a timely and contemporary platform to showcase the human characteristics of 'Kermit the Frog's' personality which viewers can identify with as a positive role model.
The K2K campaign would be an image campaign and would have a separate logo. It portrays Kermit as the world's greenest friend, hero, heartthrob and a celebrity. New shows like 'Jim Henson's Construction Site', 'Brats of the last Nebula' and 'The secret world of Alex Mack' would be introduced which have a blend of entertainment as well as educational value for the kids mainly aged between 2 and 12. The on-air and print campaigns for the K2K campaign have been designed in-house.
The 24 hour pay channel claims to have a penetration of over four million Indian households.
