While addressing at the 21st edition of FICCI Frames earlier today, President, The Walt Disney - Asia and chairman of Star and Disney India, Uday Shankar pointed out a few areas that need an immediate course correction.
President, The Walt Disney - Asia and chairman of Star and Disney India, Uday Shankar has ended his long association with the Media and Entertainment Committee of FICCI which he chaired for several years. He has passed on the baton to his former colleague, currently, country manager and vice president of Google India, Sanjay Gupta. Shankar will now play the role of senior vice president at FICCI.
While addressing at the 21st edition of FICCI Frames earlier today, Shankar spoke about the growth of the Media and Entertainment industry in the last couple of decades. He pointed out that when FICCI Frames started in 2000, the TV industry had only 100 channels on air which have now grown to over 900. The size of the print business, he said was just about $1 billion and now it is a $4 billion industry making India one of the few countries where Print continues to grow.
However, Shankar opined that the Media and Entertainment industry needs some immediate course corrections. "The biggest bane of the industry in this country, especially for print, TV, and now even for digital is its disproportionate dependence on advertising," said Shankar.
In 2000, advertising used to be just about a billion dollars, and now that number is $10 billion. While advertising has helped the industry sustain and grow and while it has benefitted the stakeholders, Shankar feels it has also distracted everyone. He asserts, globally, be it TV or Print or Digital or other forms of content, they have all benefitted by building a direct to consumer relationship where the consumers pay for what they consume.
"I think the one thing that must be fixed is our ability and our desire to get people to pay for what they consume"Uday Shankar
However, not in India, he says. Adding, "Truth be told, all of us are guilty of this. We decided to be short-sighted, we decided to subsidise our businesses and remain dependent on money from the advertiser. That has become a big setback for the industry. And if this industry has to grow to the next level, I think the one thing that must be fixed is our ability and our desire to get people to pay for what they consume. That's fair and that's the only way this industry can grow," said Shankar.
He asserted that the sales setback for the Media and Entertainment Industry is going to be severe. "This is one of the industries which people do not realise is going to be hurt very badly because of the COVID setback. And that is primarily because of our disproportionate dependence on advertising," he added.
Though the country made significant progress in making itself powerhouse when it comes to media and entertainment, Shankar feels, given the size of India, the country must be doing way more. "Our ambitions in the area of content remain very small. We are very happy winning BARC (Broadcast Audience Research Council) race on Thursdays and as long as we are going ahead over the heads of our competitors, we feel very good," he assessed.
"Unless we start becoming a bigger player or factor in the global content, consumption space, the business will always be suboptimal"Uday Shankar
Adding, "But that really is again, a huge distraction. The content business has gone truly global. And the opportunity to scale it up is much, much bigger. Today, intermediaries have been marginalised. We have the technology and the ability to go direct to consumers and make a lot bigger business. We haven't done that. And what is worse is that we've also actually been even more short-sighted and gone to create hurdles in the way of unlocking the power of the business. As a result of that, we've not been able to invest in content and we've not taken our ambitions to the global domain."
He gave examples of smaller countries (compared to India) like South Korea, Israel, Turkey, Italy, who have a much bigger media businesses. "Their content travels globally. Indian content, let us face it, still doesn't travel. And this is not for lack of creativity. This is only because of our smaller ambitions and short-sightedness. I think the industry should fix that. Unless we start becoming a bigger player or factor in the global content, consumption space, the business will always be suboptimal."
While keynote addresses and panel discussions at FICCI Frames are organised at large ballrooms in Mumbai, this year, because of the outbreak of Coronavirus, the organisers have gone virtual with dignitaries connecting from all over the world from their home. During Shankar's address, Minister of State for Finance and Corporate Affairs, Government of India, Anurag Thakur was also tuned in. After Shankar shared about the areas the industry needs to improve, he also mentioned that "It cannot happen unless the government of India recognises the sector to be an important part of the economy."
He added that with the government's recognition, Media and Entertainment industry can be a creative economy that can create jobs, businesses, wealth and can also create soft power that leads to "A greater and bigger and more shiny brand India global."
He concluded by saying that as the industry unlocks itself from the pandemic situation, it would be the best time for the stakeholders to focus on course correction.