I take great pride and privilege in presenting the Annual Report of your Company for FY2017. During the period your Company grew well in multiple ways by improving the existingbusinesses and venturing into newer formats.
The year saw the stage-setting for our digital channel ALTBalaji. We realised that toscale up in a meaningful way we would need to make own and broadcast our own content andbe present across the entire value chain of the media and entertainment industry. Thisvery thought drives the ALTBalaji platform. ALTBalaji will create and air premium originalIndian content digitally the first ever such initiative in the Indian space. It could bethought as an extension of our TV business but with a global reach using the internet.
In the television business our revenue per hour grew on a year-on-year basis and ourshows garnered record ratings and better margins. This is a mainstay of our business andwe have been executing well for over 2 decades. We introduced our weekend format show"Naagin" in 2014 and it was a runaway success among the audience. In fact theshow received such a tremendous rating that we retained our weekend time slots for theshow and are running "Naagin 2" now. Expanding our content repertoire thenon-fiction offerings of last year included producing the Star Parivar Awards and a comedyshow "Mazak Mazak Mein". Going forward we will be concentrating on doing morehigh-value fiction shows while continuing to reduce operating costs. We strengthened ourcost review mechanism and this has helped us in better optimisation while achieving ahigher level of efficiency.
Another highlight of the year is our partnership with Doordarshan. The national channelis undergoing a revamp and we succeeded in getting three prime time slots on the DDchannel the highest for any production house. These shows will commence in FY18 and arebuilt on a sponsorship model allowing us to own the IP of the content that we conceive.In addition we can look at multiple monetisation opportunities which are currently notavailable to us.
With the advent of BARC there is an expanded audience measurement. With an increasingnumber of TV-viewing homes in the rural areas a skew to the same is visible. Thispresents the requirement of content that appeals to the mass audience and an opportunityfor TV to continue to grow.
Going forward we seek to bolster the TV business by pushing the weekend fictionformat capitalising on the Doordarshan slots using our TV Company's competency to makedigital shows for ALTBalaji and also other digital platforms while trying to retain andget better terms on syndication and remake rights.
During the year the movie business saw both crests and troughs. We faced a setbackwhen online piracy caused the leak of "Great Grand Masti" well in advance of itstheatrical release. However the loss was mitigated to an extent by the success of UdtaPunjab. The Company is currently looking at an extended level of creative collaboration inthe space while minimising its commercial involvement. We aim at making fewer higherimpact movies and thus would want superior scripts that we can portray well on-screen andwill resonate with audiences. One of the steps we have taken during the year was theconsolidation of our movie production and BOLT businesses under the Balaji Telefilmsumbrella. This helps us in bringing together all creative talent within a single entityreducing costs and allows for funneling more investments to newer ventures like ALTBalaji.
Our current market research shows that there is a huge gap to be filled as nearly 30million homes in India have moved on from traditional television regional content buthaven't yet embraced international content. They are already spending nearly Rs. 1000 permonth to consume content over cable / DTH in movie theatres and to connect usingbroadband networks. This is a large opportunity space that we yearn to address and weexpect the consumer to subscribe to quality paid content. This will be done throughALTBalaji our Over-The-Top (OTT) platform targeted at the new urban audience which isconstantly on the lookout for tailor-made content.
The ALTBalaji business model follows a unique subscription scheme. Initially we allow 3free views of the series on YouTube or on our website www.altbalaji.com. Upon download ofthe ALTBalaji App the viewer can avail two more free episodes post which they will haveto pay a very attractive monthly subscription fee starting as low as Rs. 30 a month. Tofacilitate the growing trend of binge-watching we allow the download of the entire seriesupon subscription as opposed to only live streaming. While the major players in the OTTspace follow a mirror and catch-up strategy we are differentiating with premium originalIndian content aired exclusively on our platform and aim to break even by 2020 with around4-5 million subscribers globally.
Apart from online promotions we have also hosted screenings for sample audiences tomarket the launch of ALTBalaji. We have also built a robust distribution network and tiedup with telecom service providers OEM manufacturers and payment wallets. The direction inwhich this OTT platform is going forecasts a tremendous opportunity and we are reallyexcited about monetising this.
By continuing to deliver TRP leading content for Indian television being extremelyquality and cost conscious in the movie domain and increasing our footprint in the digitalspace Balaji Telefilms is going the extra mile to capture the market and create long-termshareholder value. I am sure with our high-quality content delivered using exclusive slotson the television channels or through our ALTBalaji platform we will cater to the demandsof our viewers. We solicit your constant support in making this happen.