The recent distribution joint venture between Zee Turner and Star Den promises to alter the dynamics of the channel distribution space. Subhash Chandra, chairman of Zee Entertainment Enterprises, talks about this deal, Zee?s past tie-up with Star, his plans to start a golf channel and his film and cricket ventures, in an exclusive interview with Sohini Mitter and MG Arun. Chandra, who pioneered satellite television in India, also looks back at the past and shares future insights into the broadcasting space.

What triggered the recent distribution joint-venture with Star Den?

There are many structural weaknesses in the broadcasting industry. It loses R7,000-8,000 crore annually. There is under-declaration by the last-mile cable operator. Of the total consumer spend of R24,000 crore, only R300-400 crore reaches the broadcaster. Only 3-4 of them make profit, hence there?s lack of quality programming. Whereas in the European market, 40-50% of consumer spend reaches the broadcaster. This partnership looks to correct some of the anomalies in the distribution space.

After the failure of your initial tie-up with News Corp, was this JV difficult?

The initial tie-up wasn?t easy because Richard Lee, the then owner of Star, believed there was no money in India and starting a TV channel in an Indian language wasn?t a viable proposition. He demanded $5 million as transponder cost and we paid him. He could have bought equity in our channel but he didn?t. He was late to realise the potential of the Indian market. The current collaboration should work out well.

What new business opportunities are you looking at?

We?re planning to market our food channel aggressively. We?ll launch a high-definition golf channel in August. We may bring the Indian Cricket League (ICL) back, once the court cases in London are solved. We had acquired India?s football rights for 10 years but couldn?t do much in that space, owing to Priyaranjan Das Munshi’s ill-health. He was the I&B Minister when we bought the rights and we were planning to promote football viewing in the country.

Do you think ICL was a lost opportunity?

Two things happened with ICL. First, it was a faulty format we adopted. We had no franchises and bore all the cost by ourselves. Second, the 2008 slowdown hit at that time and we couldn?t sustain it. But for the slowdown, we should have pulled through. There’s too much cricket now and there’s still scope for ICL to be back.

You exited the film business after the hugely successful Gadar saying producers get a raw deal. Any plans of re-entering the business?

Most of Gadar’s profits were eaten up by the distributors and exhibitors. Today, producers get a better deal as the multiplex system is more transparent than the single screens. But we don?t plan to enter this business again. For a corporate house, it?s a very expensive proposition and overhead costs go to the roof. Not many film studios are making money. Even, UTV is struggling.

What challenges did you face as the first private broadcaster of the country?

Broadcasting was reserved for the government then. Regulations were against us. The IPR (Intellectual Property Rights) Act made it difficult to get and protect clean content. The Indian Telegraph Act stated, transmission of any programme from a foreign satellite was illegal. We approached Doordarshan to make a techno-economic feasibility report, which said ASIASAT was the best suited satellite for transmission. When we started in 1992, there were 1.2 million cable homes in the country. It became 7 million within 12 months.

Was it difficult to get the initial programming and advertising going?

There were hardly any content providers then. Only biggies like Ramanand Sagar, BR Chopra, Dheeraj Kumar and Cinevista produced television content. They were unaffordable as they demanded R3-4 lakh per episode. So, we opened the doors to new producers like UTV, Ekta Kapoor, Tony and Deeya Singh and commissioned shows to them. We received thousands of letters from viewers. Since there was no viewership data available, our sales team took those letters to advertisers, to prove that that people were watching our shows. That’s how we attracted advertising on the channel.

How do you see the broadcast space evolving in the next decade?

The way people consume television content will change a lot. They will watch shows at their suitable time and won’t be dependent on channel timings. The delivery system through internet protocol TV (IPTV) will change the broadcast landscape. The IPTV distribution system will have 24-48 hours of programming stored within the server. A programme can be pulled out any time a viewer wants to watch it. Even now, web episodes of shows are available on YouTube. We may also look to monetise that stream.