Viacom set to launch Bollywood channel3 min read . Updated: 14 May 2010, 09:37 AM IST
Viacom set to launch Bollywood channel
Viacom set to launch Bollywood channel
Mumbai: Viacom 18 Media Pvt. Ltd, which runs the Hindi entertainment channel Colors, is set to launch a Bollywood film channel and another in Marathi as it seeks to get more out of existing assets and reach a wider audience.
It also plans to start a music television channel and is open to starting or buying regional channels, according to people familiar with its plans.
At least four senior media buyers at different advertising agencies independently said Colors was entering the Marathi GEC (general entertainment channel) space.
The Colors spokesperson declined to comment on its plans. And two Viacom 18 executives confirmed that the group was planning to launch a bouquet of channels and that the film channel would most likely be the first. None of the people Mint spoke to wanted to be identified ahead of a formal announcement.
The Viacom 18 executives said the group’s negotiations to buy UTV Movies, the Hindi film channel run by Ronnie Screwvala’s UTV group, had failed and that the firm decided to build its own channel in the genre. UTV declined comment on its talks with Colors.
Viacom 18 Media is a 50:50 joint venture between Viacom Inc. (which owns brands such as MTV Networks and Paramount Pictures) and the Network18 group (that operates CNBC-TV18 and CNBC Awaaz). Launched in July 2008, Colors established itself as the No. 1 Hindi channel ahead of Star Plus from Star India Pvt. Ltd before slipping to the No. 2 slot recently (Star Plus is back at 1).
The Bollywood film channel will go up against incumbents such as Zee Cinema, Star Gold, Filmy and UTV Movies, among others. But with the market generating revenue of between Rs450-500 crore, according to estimates by independent advertising sales agency Aidem Ventures, Viacom will be able to make better use of assets it already has or plans to acquire.
“The cost of acquiring films is high. Viacom is already buying films for Colors and it makes sense for it to amortize the cost through repeats on a film channel," said Raj Nayak, managing director of Aidem Ventures and an expert in media sales. “Also, adding another channel to the bouquet makes sense from a valuation point of view."
Colors’ Marathi channel will also compete with a host of established entertainment channels. According to TAM Media Research Pvt. Ltd’s data on Marathi viewership (from 4 April-8 May), Zee Marathi leads the pack with a market share of 43.2%. Star Pravah follows with 21.6% and ETV Marathi is third with 21.6%. Other channels in the genre include Mi Marathi, DD Sahyadri and Saam TV.
“Even from an advertiser expenditure perspective, Maharashtra is one of the largest markets and a key focus for many brands across sectors," said Ravish Kumar, executive vice-president and general manager, Star Entertainment Media Pvt. Ltd, who looks after Star Pravah. A channel with engaging content, requisite distribution and the right marketing effort could find an important critical viewer base, he added.
Analyst Anand Shah of Angel Broking Ltd estimates the size of the Marathi TV advertising market at Rs300 crore.
“Regional markets are where the growth is," he said. “The group has a Marathi news channel it runs jointly with Lokmat newspaper (IBN Lokmat). There would be obvious synergies if it launches a Marathi general entertainment channel."
Colors could be aspiring for what Star Jalsha achieved in the Bangla market, said Anita Bose, general manager, Mediaedge:cia, GroupM India Pvt. Ltd. One of the last players to enter what seemed like a saturated and over-exploited market, Jalsha expanded the ad pie for the genre. “Advertisers are willing to pay a premium because Jalsha gets 300-plus gross rating points every week," Bose said.
IBN18 Broadcast Ltd, a subsidiary of the Network18 group, has investments in Viacom18, which runs MTV, NickelodeonVH1 and Colors.
IBN18 Broadcast shares rose 1.3% on Thursday to close at Rs86.5 on the Bombay Stock Exchange, falling 5.4% in the past year. Television Eighteen India Ltd rose 2.3% to Rs80.25, losing 13.8% in the past year. The Sensex rose 0.41% to 17,265.87, gaining 43.65% in the past year.
Ashwin Ramarathinam contributed to this story.
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