MUMBAI: Ronnie Screwvala has swung back into action. After selling off kids channel Hungama TV to Walt Disney in July, he is making a re-entry into the broadcasting space.
Screwvala's UTV Software Communications Ltd. is forming a 50:50 joint venture with Malaysia-based Astro for launching a Hindi general entertainment channel (GEC) aimed at the youth. An investment of Rs 2 billion will be earmarked towards this.
The new venture will operate across multiple platforms, including a television channel, gaming, mobile, licensing and merchandising, ground events and the internet.
The first television channel in Hindi is slated for launch in the second quarter of 2007, supported by a huge multimedia campaign and multi-city ground events. UTV is currently conducting extensive research on this target group as an input to its programming and marketing designs.
The plans for the venture include the launch of multiple channels across languages in India and Southeast Asia. UTV had earlier entered into a business co-operation arrangement with Astro to set up kids channels in Malaysia and Indonesia, which launched on the Astro platform earlier this year.
Screwvala is looking at creating a channel targeted at audiences between the age group of 15-25 years. In Hungama TV, the core audience was 4-14 years.
Walt Disney has acquired 14.9 per cent stake in UTV, offering the multinational giant to participate in expansion opportunities in India. With the buyout of local Hindi channel Hungama TV in a combined purchase deal, Disney has already consolidated its position in the kids segment.
UTV recently received the FIPB (Foreign Investment Promotion Board) and other regulatory approvals for the sale of stake to Walt Disney. It may be recalled that Astro had signed the MoU with UTV to acquire 26 per cent in Hungama TV but with Disney later making a combined purchase offer, the deal didn't sail through.
Astro has ambitious plans in India and, along with Value Labs and NDTV, bought out the operations of Radio Today, the radio division of Living Media Group, which runs under the Red FM brand.
The GEC segment is poised to see further activity with NDTV planning to make an entry. Star Plus continues to lead the space but is being challenged by Zee Telefilms. Sony TV hopes to stage a comeback with Big Boss.
Screwvala's attempt, analysts say, will be to carve out a specific target audience as he so successfully did in the kids space.
Meanwhile, Disney's acquisition of Hungama TV has concluded with the final approval from the FIPB. This was followed by the inflow of Rs 1.4 billion ($ 31.125 million) from Disney to UTV within a week. Disney has also invested Rs 670 million ($ 14.5 million) towards a 14.9 per cent stake in UTV. The two companies are now working out synergies in areas across television content production, movie production and broadcasting.
"We will be working along with Disney in the areas of TV, animation and movies," says UTV CEO Ronnie Screwvala.
Areas of common involvement have been identified including the launch of niche channels, movie co-productions and television content creation by UTV for Disney channels.
UTV scrip slipped 2.7 per cent in the BSE to end today at Rs 258.70.
