Sudhanshu Vats, the group CEO of Viacom18, tells TV Asia about what’s driving his business at home and abroad.
TV ASIA: Colors launched as a bit of a disruptor brand. A decade later, it seems to have maintained that spirit. How have you kept that momentum?
VATS: It’s always had the mindset of a challenger brand, despite being number one. That’s a very good place to be. Associated with that is the ability to continuously innovate, and being willing to tear apart what you have built. That is related to innovation, but I would call it disruption.
One of the things we’ve been doing is social messaging. One of our early successes was Balika Vadhu. Most channels will tend to go for more tested and safe content. We’ve always been challenging the status quo. We’ve done issues such as bonded labor in a series called Udaan. More recently we did a show on the status of transgender people in society [Shakti—Astitva Ke Ehsaas Ki]. It’s pretty bold, for India particularly and maybe anywhere.
We’re continuously bringing in the best of international formats. Fear Factor, Big Brother as Bigg Boss, India’s Got Talent, Dancing with the Stars [Jhalak Dikhhla Jaa]. More recently, we did the first-ever live reality show with Rising Star, the Keshet International format.
And in our choice of stories, we’ve been upfront in trying to change the rules of the game. In India, conventional wisdom says that [limited] series don’t work. There is some truth to that. It’s a large country, so by the time there’s awareness of a particular show it’s close to 60 to 100 episodes, two to three months, and then it continues on and on to 1,000, 1,500 episodes. We’ve done three or four limited series. One is an international format, 24, which we adapted for India. Another one is our own paranormal series, Naagin.
And finally, among all channels, there are two things we continue to do differently. We yank shows when others would say they are running quite well. That’s the reason we launch more shows [than our competitors]. And our success rate is pretty decent. We get about a 60 percent success rate. And we have the widest spread of production houses on our channels. There are shows from some of the better-known names—Ekta Kapoor, Rashmi Sharma—as well as first-time producers. And we’ve never shied away from mounting things at a scale that is new to the Indian market. We’ve done social mythological and historical mythological, like Chakravartin Ashoka Samrat and Mahakaali—those are expensive shows by Indian standards.
TV ASIA: Tell us about the broader Viacom18 portfolio.
VATS: At the beginning, we had a TV business with four channels. Now we have five businesses: television, film, digital, live experiential and merchandising. Within television we’ve gone from 4 channels to 44 channels, 30 in India and 14 outside India catering to the diaspora (including in the U.K., U.S., Middle East and Singapore). In the 30 there are 18 brands or channels and 12 HD versions. Going from 4 to 44 is a fantastic journey. We have Hindi mass entertainment with Colors; a free-to-air brand called Rishtey and a movie channel called Rishtey Cineplex. In kids, we used to have one brand, Nickelodeon, in Hindi. We now have five feeds of Nickelodeon in different languages. Plus we’ve added Sonic and have introduced Nick Jr. We also added Nick HD+; it’s not an HD version of Nick, it’s the best of Nick in HD. Nick has been number one for four years. We own about a 33-percent share in the kids’ market. We have MTV, which is all local programming; MTV HD+, with some international content; and MTV Beats, which is a 24/7 music channel. It’s in the top three or four in the music space. That’s the youth and music portfolio. In English, we have VH1, which is music and lifestyle; Comedy Central, which is doing very well; and Colors Infinity. In English entertainment, numbers one, two and three are all Viacom18 brands, every week. The only thing that changes is the pecking order between these brands. And then, through an acquisition, we built a regional portfolio. We acquired ETV, which was present in five states already—Kannada, Marathi, Gujarati, Bangla and Oriya. They were all number four, number five channels; we’ve moved them up. Colors Kannada is a solid number one channel, Colors Marathi is a strong two, Colors Gujarati is number one in its space. We’ve introduced HD versions for all of them. In the Kannada market, which is the largest, we’ve put in Colors Super. Between [Colors Kannada and Colors Super] we have close to a 50-percent share. Recently, we entered Tamil Nadu with Colors Tamil. The journey has just begun. It’s a very tough market, as there are some powerful competitors there. So that’s the television portfolio.
TV ASIA: How’s the feature-film part of your business performing?
VATS: In film, it’s easy to get carried away and lose a lot of money. We’ve approached it in a reasonably disciplined fashion. Films don’t fail, budgets do. Each of these stories needs to be told. Depending on the budget, people say it’s successful or unsuccessful. Our success rate over a period of four or five years would be about 57 percent. This past year was a stellar one for film. We did Padmaavat and Toilet: Ek Prem Katha. We pioneered biopics with Bhaag Milkha Bhaag [about Olympian Milkha Singh] and Mary Kom. We’ve done a lot more mid-segment content-led films like Queen. We’ve done small but beautiful films like Margarita with a Straw and Manto, which premiered in Cannes. Now we’re going regional as well. We’ve done some good Marathi films already. We’re going to venture into South Indian, Bangla and Kannada. Over the last four years, we’ve been breakeven to marginally profitable and last year very profitable with the studio.
TV ASIA: How are you positioning Voot and your other digital initiatives?
VATS: On the whole, the digital piece has done very well. We launched Voot as a digital-only brand, advertiser-led video on demand. We are the second-largest premium OTT advertising-led VOD platform in India, Hotstar being the number one. We’ve done close to 80 million downloads and have about 30 million to 40 million monthly active users. And watch time is close to 45 minutes. We’re doing more and more originals for Voot. We’re going to bring in digital to the regional business as well. My belief is, 59 percent of India communicates in regional languages, about 40 percent in Hindi, and the balance 1 percent in English. English—because of the correlation to affluence—and Hindi are over-indexed from the point of view of monetization. The growth is going to come more and more in languages, which are considerably under-indexed. They were not that well measured before. Interestingly, the money is there. Some of the prominent languages are South Indian—Tamil, Telugu, Kannada, Malayalam, even Marathi. These are very affluent states. In fact, it’s the Hindi-speaking states that are relatively poorer. But Hindi cable started, and the measurement agency came in and measured what was popular at that point, and it was Hindi. All of that is changing now. Regional is becoming more popular. So the AVOD piece has done well, and now, we’re going to look at a freemium offering in India. And we’re looking at a sharply focused and segmented kids’ offering, Voot Kids.
TV ASIA: And then you also operate in the live entertainment and merchandising segments?
VATS: Experiential entertainment is a smaller business, but I think it’s one [that will expand in the] future. VH1 Supersonic is our popular EDM festival. We do a lot of college and club gigs associated with Supersonic, and similar things for Bollywood. We’ve dabbled a bit in comedy with the Comedy Central Chuckle Festival. And for kids, we’ve done a Dora the Explorer [stage show]. Merchandising is also small in India, but we are the second-largest merchandising company in the country after Disney. We do licensing and merchandising outside our own portfolio as well. We rep Peppa Pig in India—we do television, digital and merchandising, and maybe we will do live experiential—Winx Club, FC Barcelona. We’ve launched MTV-themed cafés, called Flyp@MTV, in Delhi, Mumbai and Chandigarh.
TV ASIA: What’s driving your operations outside of India?
VATS: There are a few things we’re doing in international. We want to build a portfolio of channel brands rather than just remaining with one, Colors, in general entertainment. The U.K. is a classic example of this. We have Colors, Colors HD, Rishtey, MTV Beats, which is doing quite well, and our movie channel, Cineplex. We’ve done something similar in the U.S., where we have three already and plan to have more. So we’re building a portfolio of brands that goes well beyond general entertainment—there will also be movies and music, maybe kids. We’ve got a lot of Indian IP [for kids] now, so we’ll see how we package that.
The second important piece in international is Voot. Voot International will allow us to package some of our content under one [platform]. And it will open up more markets for us. When you’re television-dependent, you need some amount of heft. The good thing about digital is you can reach two people in a market—as long as they can download it and pay you for it. I’m exaggerating, but you can go wide. That’s what you will see toward the end of this year. And to do all of this, we’re augmenting our teams—we’re going to get more aggressive on the sales piece and on syndication in markets where we’re not present. Some of the content resonates beautifully, particularly on the African continent, and in some parts of Europe as well. We’ve scaled up to a $60 million [international] business. Now we need to do more television as well as digital.
TV ASIA: In terms of the film business, what’s the window between theatrical release and broadcast, and what other monetization opportunities are there?
VATS: The window tends to be 60 to 90 days, usually 60 from the release in theaters. In India, the windows are short. Most of our movies come onto Colors or on our movie channel. At the moment, we don’t have an SVOD platform, so we keep a carve-out for us and our partners at [telco operator] Jio, but we will also do a digital deal with a global major, a Netflix or an Amazon. They get it for the rest of the world and we keep it for India.
TV ASIA: How is the original programming strategy progressing for Voot?
VATS: We have about 40 million active users on Voot. About 60 percent of the content is what is on television. About 15 to 20 percent is what we call “content around content.” These are Voot exclusives. So Bigg Boss is on television, and there are 70 cameras in the house, filming for 24 hours, so you have 840 hours of raw footage every day. Our television team uses 45 minutes [for each episode]. There is so much more you can do through different cameras, and all of that is done on Voot. Similarly, for Fear Factor and Rising Star, voting is done on Voot. Also for [scripted] series, we do behind-the-scenes clips. We’ve done 11 originals up till now only for digital. Some of them have done quite well. There’s one called It’s Not That Simple, with Swara Bhaskar. We’re doing season two of that. We’ve done Untag, Time Out, Shaadi Boys, Chinese Bhasad. We’re having a lot of fun in this space. The journey has just begun. We will do a lot more.
TV ASIA: And are you using Voot to incubate ideas that could eventually come to television?
VATS: We want to build a very strong analytical backbone. We’ve been a very strong content company, and we want to retain that edge because we’re in the business of storytelling, but the future stories have to be told with the help of analytics. It can’t just be stories alone; they won’t travel otherwise, they won’t be big enough, the probability of success won’t be as high. So now we have a central analytical engine. We have 4 million to 5 million daily active users on Voot. We know exactly what people are watching. The audience is pretty similar [to television]. Mobile data is affordable and ubiquitous. We’ve also begun testing some pilots. We’re doing that in a limited way, but we’re doing a lot more analytics.
TV ASIA: What are some of your other priorities going forward?
VATS: We’ve launched two initiatives. One is Big Belly, an intranet that will soon be available to outsiders as well, where you can share any idea you have. And then we go social on the idea. It’s not necessarily just content. It could be how to market or how to cut waste in the organization. And we’ve launched our first startup engagement program, VStEP. We invite ideas from start-ups and then we shortlist ten. These ten companies work very closely with different parts of our business. We provide business incubation, mentoring, and in some cases, cohabitation. Depending on this, we determine if we should invest in them or not.