Sapna Nair
Media

‘Sphere’ heading a change

Over time, the emergence of TV software companies, big or small, has weakened Balaji’s hold in the television industry. afaqs! profiles one such promising and much-talked about company- Sphere Origins

Creative enterprises often have to struggle to be taken seriously as a business. Investors shy from situations where temperamental creative types hold the key to success. To top that, if the business is fragmented and has major issues of scalability, well then, they would rather place their money elsewhere.

That pretty much describes the Indian TV software production business. With channels multiplying in all languages, the demand for programming software has been surging. Much of it is being produced by innumerable one-man outfits which float up or sink depending on whether or not they get the odd assignment. Serious producers probably number a few dozen.

‘Sphere’ heading a change
In a business such as this, only one company has stood out until now in terms of size: Balaji Telefilms, headed by film star Jeetendra Kapoor and whose public face has been his daughter and its creative director, Ekta Kapoor. In close partnership with STAR (whose affiliate company has a 26 per cent share in Balaji that it wants to sell), the production house has towered over rivals, notching a turnover of Rs 329 crore in 2007-08 (profit after tax: Rs 88 crore) and dominating the chart of popular shows. Balaji’s manufacturing-like approach to soap operas also showed that scalability was achievable.

However, 2008 has not been a pleasant year for Balaji. Three of its longest running shows (Kyunki Saas Bhi Kabhi Bahu Thi, Kahaani Ghar Ghar Ki and Kasauti Zindagi Kay) were discontinued on STAR Plus. Balaji took the channel to court over the dropping of Kyunki Saas Bhi Kabhi Bahu Thi but the judges ruled that the channel was within its rights to take the step. In trying to cut its reliance on STAR, Balaji depended heavily on the new entertainment channels 9X and NDTV Imagine. Unfortunately for Balaji, 9X tanked spectacularly, while NDTV Imagine is yet to make a mark.

Balaji’s growth in three of the last four years has been unimpressive, less than 15 per cent per year (barring 2005-06, when it grew by 42 per cent). And while it has tried to reduce its dependence on Hindi by going in for (mostly) sponsored regional programming, about 90 per cent of its revenue in 2007-08 continued to flow from Hindi GECs (general entertainment channels). At the end of the day, Hindi GECs is where the cream lies: Balaji earns between 7-8 times more per hour for programming in Hindi than it does for work in regional languages.

As Balaji’s domination has declined, it has left the field open to companies with some size that can make their mark, today, several production companies have two hits each in the Top 20 chart: apart from Balaji, Director’s Kut, Creative Eye, Endemol and Sphere Origins. Although Director’s Kut has risen dramatically with two big hits for STAR (Bidaai and Yeh Rishta Kya Kehlata Hai), it is still a relatively new company, Sphere Origins seems especially well placed to surge ahead.

It was best known until now as the company that produced Saat Phere, a one-time top show on Zee TV. Sphere got attention not just for the soap’s viewership rating but also because it discussed a taboo: a dark-skinned young woman in colour-conscious India at a time when nothing except the grand Balaji-style ‘K’ soaps seemed to work.

Sphere’s reputation as a creator of big hits was cemented last year by the runaway success of Balika Vadhu. The soap has proved an opportune weapon for the new GEC Colors and helped it topple STAR Plus from its perch as India’s most popular channel. Sphere has two more shows running, a daily soap (Jyoti) on NDTV Imagine and a biweekly hour-long mythological on STAR Plus (Shaurya Aur Suhani) – note that the firm has remained neutral by supplying content to four competing channels.

That’s not all, says Sunjoy Waddhwa, the entrepreneur who set up Sphere Origins. Within the next 3-4 months the firm will have a primetime daily soap each on NDTV Imagine, Colors and Zee, in addition to an afternoon daily show on Imagine. Assuming that his existing shows continue, it will double his monthly programming hours – the currency in the business – from about 40 hours to 80 hours a month.

‘Sphere’ heading a change
If he can pull that off, Waddhwa reckons that he will have caught up with Balaji on the number of hours programmed – if not in value – for Hindi GECs. Though it’s having a torrid time (in Q3 this year, its turnover is down 37 per cent), Balaji has many strengths and should bounce back. Irrespective of the precise picture, there seems little doubt that Sphere has a good chance to enter the big league in 2009.

Saying that he will close 2008-09 with a turnover of Rs 55-60 crore, Waddhwa claims that he can get to about Rs 175 crore in 2009-10. “We are sure that we will come close to it, if not achieve it,” he believes. Can he do it – or will the business, which sees companies rise and fall with the popularity of their shows, suck Sphere down?

THE RISING SPHERE

‘Sphere’ heading a change
Waddhwa is an unlikely success in the entertainment business which he entered just a dozen years ago. Brought up in Mumbai, he joined the family oil packaging business. He dabbled in the export of perfumes and handicrafts and, since 1990, in furniture export together with his wife, Comall. (His wife continues with the export business but also helps with the sets, and the overall look of the programme. As Waddhwa kids, “She is also in charge of the way I look!”)

He was looking at new business opportunities and media and entertainment showed promise. Waddhwa teamed up with his cousin to set up a firm, Karnik Communications. They decided on a show focussed on the lives of film celebrities. Zee bought into it and the weekly show, Neeyat, played for a year and a half.

The firm did a bunch of shows – Ek Mulaqat and Aatish for STAR, Arth and Thief of Baghdad (a costume and fantasy drama) for Zee and Kasauti for DD1. In 2001, following differences with his cousin, he set up his own unit, Sphere Origins.

Though it was starting from scratch, the firm found its feet quickly. It began with a tele-film for Sahara and there has been no looking back since.

In a people business, “my job as a producer is to pamper people’s ego,” he explains good humouredly. From a four-person office in 2001, the company’s current strength is 140. “We take care of people. Irrespective of how many shows we do or don’t, we don’t retrench people. We hold on to them and they hold on to us,” Waddhwa claims.

Sphere Origin’s clients seem happy to vouch for it. Ashvini Yardi, programming head, Colors, says, “Not just the thought process and execution, Sphere works on the entire show package which is their core strength.” Shailja Kejriwal, executive vice president, content, NDTV Imagine, thinks that its shows have done well because the team members have a “strong understanding of real life characters and situations which makes their story telling highly identifiable”. To which adds Anupama Mandloi, senior creative director, STAR Plus, “They are extremely organised and professional. One can trust them to have the right set of people, whether creative or technical. Their strength is drama. They are good with canvas and scale.”

To keep the team happy and produce fresh ideas can be difficult. “In a creative mind, fatigue can crop up quickly. One can’t expect a good salary hike to result in a good story. Money is not a very important factor, it’s a commodity in our business. Our way is to keep our people happy and comfortable and retain the excitement,” Waddhwa says.

While the in-house creative team brainstorms and comes up with ideas, the idea could also come from the broadcaster or a freelance writer. Equally, the broadcaster could provide an idea to the production house which scripts and executes it. For Sphere, the former has worked best, with about 80 per cent of its success coming in this way. The germ of a big idea such as Saat Phere could lie in a one-line brief: ‘The story of a dark girl and the stigma she faces.’ Spotting it is the tough bit.

WHAT’S THE FORMULA?

Waddhwa is often asked the secret to a successful soap but he has no fixed answer. Finally, it is gut feel: “When a wind of change blows, you know it’s time to do something.” His mantra: believe in the story and make it well – because there is no knowing how the audience will respond.

Balika Vadhu’s success is a happy case in point: Sphere believed it would get critical acclaim but did not anticipate its unbelievable popularity. On the other hand, Raajkumar Aaryyan for NDTV Imagine which Waddhwa believed had great promise, didn’t do well. That’s the nature of the game.

Waddhwa reasons that viewers connect with a show either because they can relate to it or because of the fantasy aspect. “What went on for so long (under the Balaji influence) on TV in the last four years was unreal drama: it took the viewers to a different world and that worked. But the saturation point has come. Now is the time for experimentation on Indian television with real and relatable drama,” argues Waddhwa. Several of his productions lately have been about inter-personal relationships and social messages. That, for him, is the crux, whether it was the story of the dark-skinned girl or child marriage.

Waddhwa worries about getting typecast. “In this business it is easy for that to happen. We want channels to look at us for any genre,” he says.

Of the two types of programming, commissioned and sponsored, Waddhwa is entirely dependent on the former. A commissioned programme is one that a channel commissions to a production house after the latter’s idea has been approved or agreed upon. In this case, the channel owns the IPR (intellectual property right) and bears the risk as well as reaps the profit. The Hindi GEC space operates almost entirely on a commissioned basis, though Doordarshan and Sun (in the south), among others, believe in sponsored programmes. Here, the production house undertakes to deliver programming for a specific time slot in return for which it receives so many minutes of commercial time which it has to hawk to advertisers.

Given the market conditions, says Waddhwa, production houses are no longer keen on the sponsored route. One reason: it needs a production house to have deep pockets. The good part is that the producer owns the IPR of the show and is entitled to re-sell the show to another channel, package it into DVD, film or a teleseries format.

WHAT NEXT?

It is a great time for a firm like Sphere – or some of its competitors – to move to the next level. The climb from this point onwards may also be harder than anything the company has done so far. If the number of shows doubles, the complexity in the business could be disproportionately magnified: be it in finding the right mix of shows, generating and spotting ideas, in raising capital, in minding cash flows, in managing artiste relationships – and above all, in controlling risk even as it sets a brisk pace.

“As a company we don’t aspire to be in the broadcasting business,” says Waddhwa, though he does admit he is open to a strategic investment from a broadcaster. Producing films, animation content and content for new media is what the production house perceives itself doing a few years down the line. Non-fiction and programming for regional channels is a priority. As it moves from soaps to less familiar territory, Sphere Origins’ understanding of content in all its forms will be sorely tested.

While Waddhwa will have to contend with competition from other firms, the hardest thing will be managing his own firm’s rapid growth.

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