One of the vdonxt asia 2017 sessions moderated by Vanita Kohli-Khandekar had Rajesh Kamat, managing director of Singapore-based Emerald Media, sharing his company's investment philosophy.
Emerald Media, pan-Asian platform set up by US-based global investment firm KKR aims to offer growth capital to media, entertainment and digital media companies. KKR has committed $300 million of its $6-billion Asia Fund II, to Emerald.
When asked about his company's investment philosophy Kamat joked that in his early days as a broadcaster, he thought that an investor's side was lucrative, but he found out it wasn't all that simple. "For having done seven investments, we've evaluated over 700 assets, and for us a strong promoter, a fundamentally solid model, a tech platform or a scalable business driven by technology - not necessarily only technology, and a regulation-friendly market constituted the checklist for the sector", replied Kamat.
He added that content ownership as a business attracted them across Asia. He also mentioned that lines are blurring in the digital domain, where content and distribution have come together. "OTT (Over The Top) players who also have their own content are interesting, and that's where a player like Yupp TV - which is a platform play that also aggregates and creates, comes in. We also see consolidation in traditional media as a good pocket -we missed the bus on multiplex consolidation. Another area of interest is services- could be technology like ad tech, agency services and even transaction services like ticketing," said Kamat speaking about the 'buckets' that they had their focus on.
Elaborating further on Yupp TV, Kamat explained, "It is focussed on diaspora which is a paying audience and these are people paying eighteen to twenty dollars today per month. That's a service we would like to back as we beleive there is enough growth left there."
Speaking more on OTTs sustaining in the coming years, Kamat listed three critical verticals- content, technology- which he felt was underplayed, and distribution. "Yupp TV is integrated into 27 devices, making distribution easy," he reasoned.
As for the India market, Kamat said that OTT plays out differently in the rest of world versus India. He explained, "In the US you pay 20-25 dollars monthly for OTT, but in India, for just 4 or 5 dollars you can get 300 -400 channels, so why would one pay for OTT - and that means banking on an Avod (advertising-led video on demand) market. The model is growing rapidly but it will take a fair bit of time." He added that strategic investors will have to last the whole battle.
Kohli-Khandekar then asked Kamat whether exit was an issue in India, to which he responded that for any market, exit is not an easy concept, but for every proposal however, his team did work backwards starting from the regulatory and exit potential space.
On the of question of aggregation, Kamat said there is enough scope for both aggregators as well as individual broadcasters, adding that consumers will be happy if they get everything in one app.
Can standalone OTT apps make returns? Kamat responded by saying that the cost of acquiring the customer was very high, He added, "We do consider the lifetime value of the customer but if at some stage they are willing to pay. I'm not shooting down Avod as a model, but can an OTT survive on Avod? Not really. It could impact the Svod model though - because if sports is free in OTT in a country, then no one else can go pay."
Event partners include: Adobe (Presented By), Viu (Powered By), Akamai (Technology Partner), Voot (Digital Partner), EY (Knowledge Partner), Unruly (Video Partner), Dropbox Business (Collaboration Partner), Web Talkies (Entertainment Partner), 101India.com (New Age Digital Partner), Culture Machine (Content Partner), 24 Frames Digital (Streaming Partner), Blogadda.com (Blogging Partner), NDTV Prime (TV Partner), Content Asia (International Media Partner), and Advertising Agencies Association of India and The Advertising Club (Community Partners).First Published : January 18, 2017