"People wondered about mobile content, while the problem was with the device"

Marcel Fenez, the global entertainment and media leader, PWC provides strategic business advice to media companies, specifically on market entry into developing economies such as India and China. He is also the current elected chairman of the Cable and Satellite Broadcasting Association of Asia (CASBAA). At Cannes, where he was a speaker, he took out time to talk to Prajjal Saha of afaqs! about global media trends, Indian media and also China.

Edited Excerpts

The first thing I would tell the brand owner is not to enter the Indian market with global understandings. They will have to forget everything that they've heard before and get rid of any misconceptions.

Instead, they will have to do their homework on the local market, but with the people in India -- on-the-ground information is of utmost importance.

The third thing would be an encouraging one -- the improved and established infrastructure, which is helpful for media companies entering India.

There are many examples of international brands failing in India. Any new brands entering the Indian market should learn from these mistakes. It is also important to get good local advisors.

You can certainly come with the global appeal of your brand; but you cannot bank on the belief that 'one size fits all'. You might have the power of your brand, as people are attracted by that. But you should also not forget that the solution always has to be local.

Ultimately, we all know that the big endgame is the big pipe, though we will have to define how far away the end is. There are next-generation networks, like we see in Singapore or Australia, which could be the answer.

Consider the whole mobile story in India. We know that in India, while there is an explosion of mobile, there are very few internet users or mobile internet users. At some point in time though, that will change.

So, I think that the interesting dilemma is that you have some infrastructure progressing slowly, but you also have the market demand really ramping up. Will this happen quickly enough? That is the dilemma.

I think if it continues at the current rate, then you will see some significant clogging of those existing pipes. Ultimately, that might restrict the opportunity the Indian market has. There is a real urgency around addressing that issue.

However, because of these issues, traditional media still has a pretty long life in India. That is why many media organisations are interested in the Indian market, because it has so many dimensions to it. I think that is what makes it a fascinating market.

I do not think the dial is going to move all that much in the next five years because of the pipe issue. Ten years from now, you will begin to see some change. Over a five-year period, you will see signs; but you will not necessarily see it having a significant impact.

That said, some really interesting things would happen to some brands, where they will use digital media, but on a very small demography and very niche. Those brands, however, would target a relatively niche audience, who could afford such access and have a lifestyle that plays to that.

However, to answer the basic question of whether things would change dramatically in the near future - no, they would not. That does not mean there is no innovation. It just means that for big advertisers targeting big audiences, it is still the same.

It would depend on what their target audience is. If their target is of a certain demographic, they could actually reach the audience quite quickly and cheaply through digital media. They would not need to look at hi-fi TV spots. So, I definitely think that they could survive and do well. Obviously, the big consumer brands may still go to TV and print.

Previously, I would have said that youth or sports brands would go the digital way, but not anymore. IPL has again changed the way the future was to be shaped.

I think that story has been true across the world. We have been talking about mobile for long now; but we have not seen it translating into numbers yet. There is a basic reason for that.

At the end of the day, the mobile phone is a device that is user friendly, a service provision that is reliable and rich content. In some markets, there would be one or two things present together; but in India, there is none. It's hardly surprising, therefore, that there hasn't been any significant movement in terms of mobile advertising.

In other markets that are beginning to address the three points, we are seeing some traction. The device revolution over the last 18 months has really begun to change the landscape. Now, people have a device, an interface that they are beginning to get comfortable with. So, the device problem has been solved. So, now we are beginning to focus on content. There are also issues over infrastructure in some markets.

I think it is a journey, but the journey is now really happening. Until now, people were wondering over the kind of content, without thinking of the device. But once the device infrastructure is in place, the focus could shift to content; maybe some news or sports. But we need the device that we can really believe in.

Well, first you think about the consumer! What is it that the consumer wants on his mobile? Work that out, and then think how the advertising proposition fits with that.

When the consumer did not have the device with which he could visualise what he wanted, then it was always going to be fairly narrow.

We have to be careful when we talk about magazines. We have to specify which format we are talking about. Magazine brands have a definite life. The question is the format. The drivers are definitely technology and what the consumer wants, but markets differ.

Let's take China, for example. Consumers in China like to be seen associated with brands. There is a cultural thing that says, "I get value by being seen with a brand". One of the great brands in the world is a magazine, and you want to be seen with an iconic brand. You cannot have it on your mobile phone. You want to be seen carrying a copy of a great publication.

That is such a local market fact. It should not be overplayed, because it does not apply to everyone. But it means that even in markets that are highly connected, you still may get a print product.

There is no question that the e-readers in many markets are making consumption of magazines online a true proposition. Many magazine brands are now looking at what could be extensions of the brands.

Would that be in print? It will depend from market to market. In the Indian context, I think it will be in print.

It could be true in the case of mass magazines. Trade magazines, for example, may be more online. Consumer magazines could be slightly different. So, I think local market factors could make print products survive longer than they otherwise would have.

While we say that, broadband means everything. But broadband has to be affordable and accessible; and you will still find some local-market variations.

The thing that is similar is advertising growth. After that, there is almost nothing in common.

The good thing is that there are particularly big ad spends that are coming into both markets. When you look at the complexion and the features of each market, they are really very, very different.

A part of that, of course, is historical, and has to do with control of content. Some of it has to do with infrastructure and also the impact of demographics. The average family sizes in India and China impact many things including media consumption. The one-child policy in China has really had a big impact.

To me, other than the growth story, they are very different.

In some markets in niche areas, it is normally about subscription, and then very highly focused advertising. That is the normal model.

I think, in the particular case of India, there is still room for progress. But then, there are other streams of revenue that people need to consider. We have not yet got our minds around the transactional components in some of these more niche areas.

If you start talking about channels as content verticals, you begin to open up whole new areas.

In the meantime, it is also a matter of how to get more addressability. Theoretically, the nice thing about niche is that it means that you can get a highly targeted audience. Pay channels all over the world would argue about that -- it is not about the mass eyeballs, but the right eyeballs.

So, if you say content acquisition is much higher in niche areas; then one needs to look at the extensions of the content.

One needs to think not just platforms, but how to use the brand to interact with consumers. The different versions of the Idols across the world, for example, are not just about the basic voting. The American Idol has its tours; the Indian Idols has its acts, and so on.

You have to go back to the consumer again, which shall say what your brand is and who you can reach. If you want to reach the high-end segment, one knows where the consumers are and what they are watching. So, it becomes much targeted that way. But, let's face it; in India, majority of advertising is still about reaching millions and millions of people. I think there is certainly a place for the niche.

The Indian ad market has been very, very small until recently. Inevitably, the first sort of rush of new activity will be around the mass brands. The next wave would be around more sophisticated and niche ones. And that is when you start getting into some of these other considerations.

Most markets demonstrate the same things. It is just over what period of time, which is the issue.

You cannot call yourself a global brand unless you are in India. It is as simple as that. To be truly global, you have to address the major markets of the world; and so, you have to be in India. To me, that is non-negotiable.

There are things that are happening in India over the past 20 years, which overseas companies can learn from as well. A market that is as dynamic also provides learnings for other markets globally.

But it is not just about a brand that is working its brand value by bringing stuff in. It is also about how you create a local version of the brand. That is when you really get that soft spot.

People will make mistakes. India is a pretty good case in point. Many brands came into India 35 years ago and then went out again. Well, they did it the wrong way, and they learnt that lesson. That lesson is very valuable when you are solving problems in other markets around the world.

The Zee channels, for example, have been around the world. That is very compelling and that worked very well. Zee was one of the first non-US or UK channels to have a worldwide presence. This was followed by Russian and Arabic channels. So, that is a very good example.