The fifty-something chief executive officer of Star TV (South Asia), Rathikant Basu, has always maintained a high profile "" even when he was an Indian Administrative Service officer "" which he says is his USP.
His style of functioning can be debated upon, but even his severest of critics cannot deny that during his tenure as the director-general of Doordarshan during the early 90s, the state broadcaster was turned into a lean and fighting fit organisation from a monolithic giant.
In his capacity as boss of Mandi House, he fought tooth and nail with Star TV while refusing to give an inch to the Rupert Murdoch-controlled broadcasting company during various cricket tournaments held in the country and over their telecasting rights.
Now as the chief executive officer of Star TV, Basu is trying to chart a path of success for Star TV amidst bureaucratic tangle.
In an interview with Surajeet Das Gupta, Basu discussed his strategy to make Star Plus the countrys number one composite channel, his plans on direct to home and Stars relationship with its partner, Zee TV.
After taking over as the chief of Star TV what has been your strategy for the company?
When we came to India there was no restriction on satellite broadcasting, so we started operations mainly with international programming. In 1995 the number of channels available in India started increasing. The regional language channels came up in south India in Tamil, Telugu, Kannada and Malayalam. They took away audiences. Then in Hindi also you had Zee TV, Sony and Home TV. They took away audiences. Add to that channels like NEPC, Jain TV, BiTV. As a result the share of our audiences fell and the initial attraction for western programming reduced. So the audience for Star TV went down and by 1996 had come down to less than one per cent.
Around this time, we thought that the solution really was to go in for more Indian programme and to Indianise the channel. The experience of Channel V, which went into Hindi film music and Indian pop was a success. We went on a similar exercise with Star Plus.
What is your strategy to revamp Star Plus. Will it increasingly have more Hindi programming?
We have restricted ourselves to two hours of Hindi programming a day because of the agreement we have with Zee TV that we wont become a predominantly Hindi channel. However, we do a lot of other Indian programming which is in English. Our audience share now in prime time has increased to 6% in 8 months. We are probably no. 2 or 3 amongst the satellite channels in the country.
Our strategy is to develop Star as a composite channel with relatively low cost international and Indian programming. At the moment we are doing something like 60 to 65 hours a week of Indian programming out of which only 15 hours are in Hindi. We are targeting the mature audiences in the age group of above 25 years.
What percentage of your programming will be Indian?
Hindi programming may not increase very much. But we hope Indian programming would increase to somewhere around 40 to 50 per cent of total time. Today its share is one-third of the total time.
Will the Indian programmes consist basically of regional language programming?
No, it would mostly be in English language. In India in the print media, the English language newspapers take a bulk of the advertising. We want to position ourselves in that bracket to woo the same people who read English language newspapers.
Two years down the line what is the target in terms of market share of audiences that you aim for?
I wont put a target. But I would like to be the number 2 channel amongst satellite channels in India. A purely Hindi channel will always be number one. But we would like to be the number one composite channel with both English and Hindi programmes. Also what is important is the quality of the share.
I would like a channel which is watched by people who matter, people who set opinion rather than follow opinion. But in the short term my target is to move from 6% to 8%.
Do you see your agreement with Zee on limiting the hours of Hindi programming effecting your revenues as these programmes attract bulk of the advertising.
No, amazingly not. In fact the Hindi programme that we run do not give us the bulk of our revenue but the Indian programmes which earn us substantial revenue. Our English news in fact gives us a large amount of our revenues along with several other programmes.
How much does Hindi contribute to your total advertising revenue?
I would say it is about 40 per cent, but we expect those revenues will also pick up. But revenues are not necessarily determined by language. I think we get revenues quite out of proportion to our audiences share because of the quality of the audience we deliver.
And I think advertisers are very conscious of that. Even the audiences for our Hindi programming are very different from the audiences of other Hindi channels. There is a far larger proportion of the social category A in our audiences.
NewsCorp has announced major investments in DTH but the project has got stuck due to the Government policy. How long are you ready to wait for the government to clear DTH and how crucial is this project for NewsCorp.
Well in terms of business, its not an important project, and also in terms of content its not that Star will have more channels except a 24 hour news channel. DTH is basically a business proposition. Its a large investment and it involves very long gestation periods but at the end of the day the return is very good.
NewsCorps strategy is to have digital platforms all along the globe. We planned for DTH in India when there was no objection to it.
But how long are you ready to wait for DTH?
We are making alternative plans, but it is difficult to set a time limit. We could find the alternatives as attractive as DTH.
Basically the investment that we have made is in transponders which we have booked and are reserving them for DTH at the moment. But if we get other uses for them we will use them)
Murdoch came to India to meet the former PM Deve Gowda and evinced interest in setting up a broadcasting facility in India. What happened to that plan?
There was no such talk, and Murdoch had not expressed any desire to set up base in India as the Chinese government has given Star a commitment that they will be allowed to continue their operations. In fact, Star will soon be broadcasting within Hong Kong itself. So there is no reason to leave Hong Kong.
Are you looking at uplinking from India ?
Well when the bill comes into force and when it is allowed then we will see if it is viable. But at the moment all our earth stations and uplinking facility are in Hon Kong.
But is it viable to uplink from India?
It could be, but I think we have missed the bus. Singapore and Kuala Lumpur have come up as alternative centres.
In fact ESPN and several other channels have already started uplinking out of Singapore. All this investment could have come into India if uplinking was allowed. Today these facilities have already come up and investments have been made there. So I am not sure how many would move into India.
Will you pick up transponders in the Insat series of satellite if this was finally allowed by the government.
Well, it would depend on the footprint of the satellite. At the moment we are using Pan-Asian satellites which cover 56 countries. So if we get satellites with comparable footprint and comparable power then certainly it will be a good bet.
Are you looking at any collaboration with Doordarshan?
When we wanted to start DTH in November there was no law. So we had written a letter to Ministry of Information & Broadcasting offering to carry Doordarshan channels on DTH platform. In fact, we also offered to build for them a Ku band earth station so that they could uplink to Pas- 4. But instead of a reply we got a notification from DOT.
Why should the people pay such a high price for DTH rather than see free-to-air channels.?
Because of its high quality, for larger quality choices. Why would some one pay 22 lakh for a Mercedes when he can get a normal car in Rs 6 or Rs 7 lakh.
At what level do you break even in DTH?
It is estimated around a million households. Of course that will also depend on several other factors like the license fee. If there is no license fee to be paid to the government , then a million will be a break even point. But if there is license fee then break even might be a little more.
Would you get into terrestrial television once this area is opened up to the private sector?
No, because we believe that terrestrial TV is meant for the local Indian broadcasters and the national broadcaster.
There seems to have been serious differences between Star and Subhash Chandra on the running of the business. How is your relationship with your partner Chandra.
So no one partner can dominate the other. As far as the Hindi programmes are concerned, the share of audience on Zee TV before we started Hindi telecast was about 20-21% and it still remains so. So there is no change of audience share for Zee after we introduced our Hindi programmes. We have created new audiences and maybe we are taking some audiences from the marginal channels.
You seemed to have had problems on the question of their joining your DTH platform. They dont seem keen to join the platform.
They havent told us that. At the moment nothing is happening on DTH but once it happens I am sure they would probably be very much there. Between partners they are issues of commercial nature. At what price Zee channels come on to our DTH platform is an issue and that has not been resolved.
Have you offered to buy out Chandras stake in Asia Today Ltd the Hong Kong based company ?
We certainly do not wish to buy out Chandras stake in ATL.
But what is the reason for the tension between Subash Chandra and StarTV?
I have no idea. I think it is more a question of perception of each other. We have every interest in keeping this partnership alive and we dont want to hurt their audiences and their advertising as 50% of profits come to us. So unless I have an option in which I will earn more than 50% of profits there is no point on hurting Zee as I am the one who loses.
The agreement with ATL and Asiasat-1 for the transponders is till 2000. What happens after that?.
The Asiasat I will get de-commissioned by 1999-2000. Then we have option on Asiasat 3 where all these channels will migrate. So then they (Zee) will have the option to make up their mind.
What is your strategy in terms of software? Will you farm it out or will you have enough your own production facility?
We are setting up a very large post productions facility n Mumbai. We will allow in-house and private producers to use it. As far as any major production is concerned, it will still be sourced from outside. We are not going to go into production of serials.
What has been the performance of Siti Cable?
Yes, Siti cable has not yet shown profits. But they have achieved a certain level of distributions. And we have made 50% of investments.
Have you any alternate to this distribution?
No.
Is the satellite media getting divided between the foreign players and the Indian players.
I dont think so because no Indian group can afford the satellite media. Yes they will be several people who will invest a 100 crore but with 100 crore you can only run a channel for one year. You will need another Rs 100 crore next year and you wont earn Rs 100 crore in the first year.We have restricted ourselves to two hours of Hindi programming a day because of the agreement we have with Zee TV that we wont become a
predominantly Hindi channel. However, we do a lot of other Indian
programming which is in English. Our audience share now in prime time has increased to 6% in 8 months. We are probably No 2 or 3 among the satellite channels in the country. Our strategy is to develop Star as a composite channel
Rathikant Basu CEO, Star TV (South Asia)