While television will continue to be the mainstay of Zee Entertainment’s business, Punit Goenka sees the revenue of the future supported significantly by three new thrust areas: films, digital and live events. While Zee has been slow off the blocks, and even seen to be groping in the dark, as far as digital is concerned, Goenka is confident that their relaunch strategy is well-thought through. The film business has already started contributing to the topline and the bottom line. It is his views on the live event business that makes one stop and think, though. Read on. You can also view the interview here.

Anant Rangaswami: Punit, it’s 25 years since Zee TV launched, the channel that launched the Zee Network. Rather than talk about those 25, I thought maybe we should talk about the next 25, maybe a subset of those 25. So first, what are your focus areas for the immediate future?
Punit Goenka: Firstly, Anant, thank you for this opportunity. I really appreciate it and I want to wish all my colleagues in Zee, though this year has not been all that great due to several of the government’s initiatives which are, hopefully, in the long term, better for us.
Coming to your question, while the television business, which Zee is known for, is still the largest piece of our business, I believe the future is going to be very different. And the future will be different in several manners. While television will still continue to grow in this country, there are several verticals that Zee is focusing on which I believe will be the future of this media and entertainment powerhouse that we call ourselves. First and foremost, our entry into the movies segment through our production business, and the music publishing business is going to be a core focus area for us. We believe that film entertainment and consumption of film entertainment across platforms, across mediums, is only going to grow further.

AR: And across geographies…
PG: And across geographies, yes. We believe that films further break the boundaries of this world, and bring communities together. So we’re going to focus on that in a big way. The next vertical we’re going to focus on is digital, of course, which is you know, consumption of non-linear television on personal devices, or even on your traditional device like television. We can no longer program for audiences. The audiences will program for themselves.

AR: When you say programming, you mean scheduling?
PG: Exactly. So linear television is going to slow down, but audiences will consume content at their convenience, at their time of convenience, around the device of their convenience.

AR: Before you come to the next focus area, I’ll say that with digital, you’ve been slow.
PG: We’ve been extremely slow.

AR: So when you say focus area, how do we see a change?
PG: So the change is going to be through new platforms that we intend to launch in the next couple of months itself. We are integrating our entire platform strategy of OZEE and Ditto into one common platform across our verticals or businesses that will be launching soon. What I mean to say is that its not just a video platform anymore. We’re going to build a platform that will go from text to video to even e-commerce in the future. So that is the second piece that we are working on.

We believe that films further break the boundaries of this world, and bring communities together. So we’re going to focus on that in a big way.

AR: All right. So carry on with your focus areas…
PG: Finally, I believe that something that no one in this country is focusing on is the live entertainment space. And I when I say live, I mean spanning from concerts to food festivals to theatre going audiences, etc. The infrastructure in this country is lacking so much that nobody really is focusing there.

AR: So how will you deal with the infrastructure problems? When you look at people like NH7 / OML, one of the biggest complaints they have is infrastructure, and government regulations state-by-state, etc.
PG: Unfortunately, my peers in the industry are only focusing on bringing talent from the outside into India, whereas I want to work on taking the best of Indian talent to the global world. And therefore, we can afford to invest in infrastructure ourselves, and that’s how we want to build this business up. Today, it’s (the live business)pennies as compared to what you see in our balance sheet financials. But I believe going forward in the next five or ten years, it’s going to be a very big business.

AR: So you’ve spoken about television, you’ve spoken about your films, you’ve spoken about digital, and you’ve spoken about live entertainment. So what’s the next cornerstone of your focus?
PG: My cornerstone today is spanning the three non-traditional verticals. Television itself is very stable and growing, but I’m spending a lot of my time on the next three verticals, which is digital, films, and the live entertainment aspects.

AR: So to build on this, tell me, few years from now, what will the revenue pie of your businesses look like. Today, films is hardly a portion of that, live entertainment is next to nothing, digital is small…so how will the revenue pie change?
PG: Well, films aren’t really that small anymore. Films, within this financial year itself, will be anywhere between eight to ten percent, depending on how the films fare at the box office. On term, the other two are very very miniscule, but I do believe that in the next five years time, these three new verticals should contribute anything between 35% to 50% of my topline.

AR: This is interesting. Before we go deeper in to digital and live which I want to do, I want to stay with your traditional business, television. That business has changed dramatically over the 25 years that Zee has existed. I was having a chat with somebody, and I was a salesman myself 25 years ago when Zee started, and then, media planning and buying was done very differently than what it is today. There was no such thing as a media independent in those days. Deals were done between media planners, a client, and you had the medium itself…
PG: Including creative, which was part of the same industry.
AR: Correct. And all these three people sat at a table, they did deals together. They fought together, they celebrated together, all these things happened. And now you’ve got an intermediate, which conducts most of your business. How do you grapple with that part of the business? You need it, but you don’t need it. So is it a friend, is it an enemy, the media agency business?
PG: (Laughs). I think it’s a function of the day you wake up and of the deal you are trying to crack. So from that perspective, the media agencies, the media owners, and the final client at the end, for them, for it work out, it has to be a win-win situation. I don’t like the fact that the three don’t sit at a table together anymore. I think that’s a disadvantage because the media owner can present the case of the media themselves better to the client, ideally. And while the media agencies work for the interest of the client, they don’t really appreciate the assets of the media owner’s value all the time.

AR: So are media agencies an enemy?
PG: I don’t call them enemies. I don’t think they are heading there. They facilitate the business.

AR: Are they friends?
PG: They are friends till the time it suits them, but it has to be a win-win at the end of the day. And even today, there is a deal that I negotiated myself, and that is a marquee deal for the entire business. And that is something that the client and the agency and myself as a media owner, had to sit together and break.

I don’t like the fact that the three (media owners, media agencies and advertisers) don’t sit at a table together anymore.

AR: Do you think there is any room to go back to the old days where the media salesman spent a lot more time with the client, and in a way the buying/planning agency only stamped the deal? Is there room to go back or go some distance in that direction?
PG: I wouldn’t say there’s room to go back. I would say there is room for us to now evolve a new ecosystem. Media ownership and media offerings are so vast and varied as compared to 20 years back, or 25 years back when Zee started. Today, you’ve got print, television, radio, digital, and so many avenues for advertising; if we don’t understand the power of each one of those, and if the client doesn’t understand the power of each one of those, it can be a bit misleading.

AR: So what do you have to do, the media owner? What do you have to do to get the client to understand this better, different from what you’re doing today?
PG: Different from what we’re doing today? I think the basic thing we need to do is present to them what exactly each of these brands or these verticals can do together, for the client, not for the agency. And that’s where the bridge will get completed.

AR: But the structure has changed so dramatically that in a lot of large companies, the client won’t spend time with you will ask you to discuss it with their media agencies, and say “they’ll evaluate it and come back to me.”
PG: They may not do it today, but in six months, one year, two years down the line, they will have to do it, is my view.

AR: They will have to do it meaning, you’ll find a device or, what will it take for them to do it?
PG: The device is going to be the market itself. The market will change so dramatically, that if they choose not to do it, they will lose the game.

AR: Okay, so, one is the client side, and one is the media agency side. What would you tell the media agencies they have to do to change? Or what happens? Do they lose a slice of their business? Do you see them being redundant? What do you see evolving in a new world?
PG: I think the biggest message from my side to the media agencies is going to be: don’t look at only the trading based business model. Because that business model won’t last for too long. And they need to become true partners both to the client’s side and the media owner’s side for it to be a win-win situation.

AR: So demonetization was November 8, 2016. We’ve had demonetization, we’ve had GST and from what I understand anecdotally, all the big broadcasters have had huge tussles with the big media agencies. It’s not Zee, it’s Zee, Star, Viacom18, all have had tussles. It’s been a very fractious year for all of you. So, why did this happen, and how can you prevent it from happening again? Why can’t it be, like you said, win-win? What’s stopping it?
PG: I think the business model itself prevents it from being a win-win today.

AR: Right. Whose business model?
PG: Each one of ours. Because our objectives are so different. As a media owner, my objective is to maximize the advertising revenue that I need to generate in a quarter, in a half year, in a full year, especially given that I am a listed entity, unlike most of my peers in this country. The media agency’s objective is very different. They need to look at their P&Ls, cost structures, etc. Plus, the advertiser, the main client, if his product is not moving in the market, I can’t expect him to spend money on media because his business model also needs to be sustained. So it’s because we don’t sit across the table from each other and discuss these issues, is where the issue starts.

AR: Now this sounds nice in theory, “if we don’t sit across the table…”. So who is going to bell the cat? Who is going to start sitting across the table from the client? Are you going to do it? Is the client going to do it? You know, it’s nice, and you could’ve said this six months ago, you can say it six months from now…
PG: I don’t need to say it again because I’m demonstrating what I’m doing. In the sense that, after one of the key marquee deals I talked about, we had a celebratory dinner just last week where we celebrated the deal. And I’m sure we celebrated it given the fact that it was a win-win for the client, for the agency and for us. And that’s a reason for a celebration. So we’re already starting to move towards that direction.

AR: Is that unstoppable now, the construct of not really going back 25 years, but understanding the virtues of the good of the 25 years and bringing them back today? Is it going to be the norm?
PG: Absolutely. It has to be the norm, and it has to be a norm that moves to the other verticals we just talked about. Because today we’re still implying that only for the television business.

AR: Right. Now staying with television Punit, one of the problems which has caused this funny relationship is measurement. I know you have very strong views on measurement, and you’ve been part of a small team that’s trying to change measurement for the better. So where is measurement now? Where is BARC now? How has it helped you make deals, not make deals? And when I say “you”, I mean television as a whole?
PG: See in my view, television in absolute terms has grown. If you look at what BARC has achieved over the last 12 months. This is the first time we’ve had a consistent 12-month data for both urban-rural combined. And the metric that we’ve moved from — GRPs to actual 1000s of impressions that we create. If you look at that metric, television grew 24% in the last 12 months. Now that’s a huge number. From that perspective, we need to recognize that number.

AR: Who is the “we” that you speak of?
PG: The industry. I’m talking about the ecosystem, the client, the agency and the media owner. We buy one media today at a certain cost of measurement. We buy another medium at another cost of measurement. Why can’t we move to one uniform metric of measurement? That’s the biggest problem today. I mean, because we are willing to live with CPRP as a currency, we will never move to the next stage of growth.

AR: Yes, but we’ve had this CPRP/CPM debate for some 15 years now? It’s not moved. When is the client going to pay for the size of audience as opposed to rating points?
PG: Unfortunately the problem is till the media owner says a firm “NO”, nobody is going to move.

AR: So who’s going to say “no”? When will that happen? That’s the point. We’ve heard this for 15 years. I think it was Vikram Sakhuja who made a strong case in the early 2000s saying that we should move to CPTs…
PG: Absolutely. I remember those days. And you know that while heading BARC, I was propagating this whole issue about CPMs since the longest time I can remember. Twenty-five years ago, it was one channel that was the entire industry in to this country. Today, you’ve got 800 channels, 650 active channels; these are the numbers I keep hearing. The fact of the matter is that we all need to understand the fact that it will all become unsustainable… Media agencies hire so many planners and so many people to do post analysis. I mean, if you move to a single currency, your cost structures will be very different. Cost structures will change for the entire industry.

AR: Moving from CPRP has always sounded like a good plan for everybody. It sounded like that. Yet, it hasn’t happened. So what is stopping it?
PG: It’s the fear.

AR: The fear of what?
PG: The fear (that brands have) that from tomorrow itself, my cost will go up to 250%.

AR: It’s happened in other industries; it’s a new normal which you get used to. We’ve got used to 18% GST, 28% GST, or whatever the slab is. It’s a new normal.
PG: Or the fact that we moved to a 12 minute ad-cap rule. So we all moved. Or digitization. So it’s a matter for the industry coming together and saying, this is the date. We will all move. And this is the path to converting everything to CPM. Because no media owner that I’ve spoken to is asking to move everything overnight. We’re saying “let’s lay down the path to move.” I don’t know whether it’s 18 months, two years, or three years. I don’t know what the right answer is. But it needs to start.

AR: But who’s going to bell the cat? Is it the AAAI, is it the IBF?
PG: Unfortunately, it has to be the IBF.

AR: Why do you say unfortunately?
PG: Because the interest of IBF is far more aligned to CPM than anyone else in the short term.

AR: So do you see this happening in the near future?
PG: If I get the support of my peers in the industry, I’m sure it can happen.

We need to create a new piece, which is download and view offline. Because in our country, the bandwidth costs are so prohibitive that we need to create that option for consumers, and that’s what Zee intends to do.

AR: So Punit, going back to the focus areas. You spoke about how digital is going to be a very big part because your eyeballs will go from television to other devices. And money will also follow. But the money on digital, if we look at it as a CPRP or CPM, is much lower than what you get on television. So how do you deal with that monetization?
PG: Firstly, I don’t think that eyeballs will shift from television to digital. Let’s just take India as an example, only, for now. India is a 65% television penetrated market. Of that 65%, 94% are single TV household, where the general population of a general household is 4.2, 4.3 whichever data you look at. Today digital is offering an incremental content opportunity in this country for us to monetize. So therefore in the short term, I don’t expect that the traditional television revenue will shift to digital. I think we’re going to create a new ecosystem of an incremental audience base that will emerge going forward. Let’s look at global trends. Definitely, eyeballs are shifting form linear broadcast of television to digital broadcast of content. There, the subscription models are so strong that any loss on the advertising front is still not that painful for a traditional company.

AR: But there, they are used to paying happily for content.
PG: Correct. And that ecosystem will emerge for India too, as long as you create content that appeals to any individual. And therefore, they are willing to pay for it. If you look at today, with just about 200 million OTT platform consumers in this country, in a population with about 1.3 billion, I think with technology improving and bandwidth cost decreasing further, the penetration of OTT will increase to a larger extent. I do believe from moving from the traditional form of television, which is the “power of ‘n’” to the “power of one” is what the digital platform offers.

AR: Punit, the problem is, now as we go more digital, the power of avoiding ads rests with the consumer. And therefore the pressure to get the consumer through subscription or Pay Per View or whatever that is. You’ve got TRAI that dictates so much. On digital, you don’t have that problem. But on television, you do have that problem. So how will you address ad avoidance, and still maintaining your revenues from advertising?
PG: As you rightly said, the power shifts to the consumers hand. So if the consumer decides to consume content without viewing advertising, they should be willing to pay for it, whether that is through a transactional video-on-demand format or a subscription video-on-demand format. Now there is a third piece to this which I’ve been talking about which very few have taken notice of. As India, we need to create a third piece, which is download and view offline. Because in our country, the bandwidth costs are so prohibitive that we need to create that option for consumers, and that’s what Zee intends to do. And the moment the consumer comes back online, all that data is transferred back in terms of what he’s consumed, what ads he has consumed, if he’s not consumed ads, he’s only watched the subscription service, and therefore you get paid for it on that parameter.

AR: One of the strengths that your company has had over the years is in the distribution revenue. You have been pioneers in distribution, and you’ve moved on and on. You’ve got DTH revenue as well, plus the merger with Videocon, then you’’ve got Siti Cable, and several distribution assets. So how do you see distribution revenue changing over the next few years as people go digital?
PG: I believe that the country is large enough, or the world is large enough for all models to co-exist. There will be an audience set that will consume DTH services. There will be an audience that will go to cable, provided cable also provides broadband capabilities to the consumer. At the end of the day, no other service can beat the wireline broadband service. There will be a free-to-air medium of business that will continue in the country, and there will be monetization models that will cut across these platforms. So from that perspective, I see while these entities that you talk about, DishTV, Videocon, Siti Cable (these are not part of Zee Entertainment Enterprises Ltd, which is a separately listed entity) I believe that the future is there for all of them to coexist.

AR: Now when you are seeing so much movement of the consumer, again, if we go back 25 years when Zee started, the consumer was very clear. He was the guy who got a cable connection and watched it. That’s all it was, there was no problem. Now it is so complex, he could be getting content through cable, through DTH, through OTT, on his phone, whatever it is. So now you as an advertiser have to help navigate this and find the viewer wherever he is going. So what’s the role you are playing in helping the advertiser? The large advertisers are as confused as anybody else today.
PG: Well, today we are not doing much on that. I think the only technology that currently exists which is effectively doing it, is the split beam technology from our friends down in Bangalore (Amagi). I think with OTT platforms, etc., coming into the fray, especially content companies like us which will have products available across the spectrum of platforms, we will have to educate the advertiser and work with them to see where is the client base that they want to attract their consumer the maximum. And therefore, just like we sold GEC, or movies, or regional, independent of each other, we will now have to sell audiences on different platforms individually or collectively as the advertiser demands.

AR: That’s a vision kind of statement. Now how does that translate to your sales team? They’ve got to get rewired to deal with all these changes.
PG: It has to be a new ecosystem altogether. If I take you back 25 years, we sold one channel. From there we went to sell a bouquet of channels, which we sold as a bundle. And then came the 2000s, where we realized that unbundling or selling these channels will create far more value, both for the advertiser, and for us. Similarly, going forward, it will be now platform agnostic viewing that we are now trying to reach. And if the sales teams, my sales teams, or the buying teams of the client are not geared for it, some kind of change will need to happen.

AR: Okay, now I’ll urge you that as the ecosystem gets more complex, the larger advertiser is tempted to use the intermediary, which is use the media planning or buying agency to deal with you, because they don’t want to deal with these complexities. And that’s not good for you, and when I say you, for the broadcaster or content owner. But that is the easy way out. To say, “I don’t want to deal with this, so send me a plan.”
PG: Well, if I can give you a candid answer, in the mid to long term, it’s not good for them either. To just depend on the intermediaries to not having to deal with the problem. As much as understanding their own product, is the need to market their product, and to the consumer they want to market it to. And to choose not to understand it, that would be a mistake on their part.

AR: So again, who is going to bell the cat? Who is going to take the first step and say that hey, we need to understand that this is a new world, and we need to start talking to ourselves, each other, differently?
PG: So in this case, I will put it differently. Fortunately, it’s got to be the media owner who has to do it. Because the media owner understands the value of the consumer that it attracts through the content that it creates. And we are best poised to explain it to the customer, our customer being the advertiser.

Somebody the other day asked me, “Who is your competition, Punit?” I said, “Any activity that takes your attention away from my business is my competition.” So you go to a restaurant to eat, that’s my competition. It’s as simple as that.

AR: Okay, now to come to your next focus area, which is films. Now, somehow, films is something that is not traditional (for Zee). You’ve not done it for 25 years. It’s a recent development. Why are you getting in to films at all? On the face of it, it’s a risky business. And Zee has been famous for not taking large risks, except at the very beginning when I guess Dr Subhash Chandra gambled and started Zee. After that, it has been a very careful company.
PG: (Laughs). Well, while we have been a very careful company, it’s not true that we haven’t taken risks after the initial periods when Dr Chandra launched the company. I mean, we’ve taken risks where we’ve entered markets like Tamil Nadu, where the incumbent player is so large that even the thought of competing with them is very difficult. I think of the people who are present in the southern markets today, Zee is the last entrant. All others entered through acquisition or inorganic opportunities. Zee was the only one who went in there in (a) Greenfield (venture) and made a success out of it. It is our own dedication that we tried digital much ahead of anyone else, while we went wrong in our strategies. That is one correction for you, Anant, that I wanted to make.
AR: Thank you. I stand corrected.
PG: Coming back to the question of why films now, I think the easy answer would be to say that because we are consumers or buyers of most rights ourselves. That would be the easy answer. But I truly believe that the fact that the market segments that go to view films are not television consumers. And my objective in the long term for this company, is to grab maximum time share of the consumer. And films form a critical part of that. And films is not just production of films. It is music publishing, to the film production, then satellite, then digital, or now we can even think about digital first and then satellite. So those days have already come. So you’re trying to get the entire spectrum of the consumer’s mindspace when it comes to entertainment. Somebody the other day asked me, “Who is your competition, Punit?” I said, “Any activity that takes your attention away from my business is my competition.” So you go to a restaurant to eat, that’s my competition. It’s as simple as that.

AR: So are you going to get into restaurants?
PG: (Laughs). I don’t think I can span the entire 24-hour activity because then the next question will be “Will I make mattresses?” I can’t do that! (Laughs)

AR: Staying with films, it opens up a new set of competition. So theoretically, you’ll be competing with a Red Chillies, Shahrukh, Karan Johar, Ekta Kapoor, etc., where today, you’re not a threat to them and they are not a threat to you. Tomorrow, you do become a threat. For example, the release dates of your movies clash. So conflict arises from that as well. So how do you manage that?
PG: Conflict has always existed in our life back when we were only running the television business. I competed with Star, Sony, Sun, Viacom, and our shows’ launch dates coincided. But life went on. So at the end of the day, the product will speak for itself. It’s not about whose film it is. It’s about what film have you made, how good is the film, and the consumer will choose what he likes. At the end, there are only 52 weekends I will choose from, right? And films will clash, they will compete, it’s the reality of life that we have to live with.

AR: There’s a new paradigm in films that we have to live with. There’s one big Friday, perhaps the one weekend decides the fate of the film in many ways. So it’s a marketing machine that has to be in place. And we’ve seen the success of many marketing machines where a critically criticized film does well at the box office because it is marketed well. So do you have the marketing machine in place?
PG: If you ask me 100%, no. I think we’re still building that. We are very, very, young in the film business space. We are just three years old. We launched music publishing, and then got into film production. While we’ve had far more success in regional languages like Marathi, we’re yet to do a lot more in the Hindi space. Unfortunately the film space for us gets compared only from a Hindi language perspective, but I think there’s a lot more depth in the regional language space that we see. If I may quote another film of mine like Sairaat, to contradict what you have said on “one big Friday or one big weekend”, Sairaat ran for more than two and a half months and, just in the state of Maharashtra, did Rs 98cr worth of business. Most Hindi films do not boast those kinds of numbers. And that movie was made at a pittance compared to the Hindi movies we talk about. So again, I bring it back to the fact that it is all about content. Our latest release, Secret Superstar, is doing great guns releasing against a mammoth film.

AR: Now films have also become a large tool for brands to place themselves, to market themselves and so on. What is your focus on marketers using your bouquet of films to sell products to their consumers?
PG: So far I believe the brands and advertising companies have only used films to just use them for the star power to market their products. I think the moment they start becoming more contextual to the film’s theme, they will benefit a lot more. So partnering with the right product in the right film will work a lot more, rather than just using the power of the actor who is cast in that film.

AR: So that again, how do you talk to the brands? How do brands know that there’s a new film coming up six months from now, and so on? What is the machine? Will they go back to their media agencies, and then do you go through the same loop as you go in television, or…?
PG: That is yet to be discovered. I think it’s still happening through media agencies, unfortunately. And it happens where the marketing manager has a personal liking towards the film or towards the actors, where these integrations are happening today. But going forward, these will have to become far more constructive in nature. As Zee Studios, I can showcase my slate of five, ten, fifteen films that are upcoming, and even share the script details with them to come and partner with us.

AR: So then we’ve spoken about television, digital, films, etc. And there are other pieces in the larger Zee stable, which are radio and print, where you have interests in. Your group has bought into radio in a large way…
PG: Yes, as another entity. Not as Zee Entertainment.

AR: And of course you have DNA as a newspaper, you have WION as a channel that you’ve launched recently. So how do these pieces fit in to a whole scheme of things, when it comes to you? Step out of Zee Entertainment, and talk about those.
PG: While radio and print are not part of Zee Entertainment Enterprises Ltd, they are part of separate entities of the group. I do believe that India has a distinct opportunity going forward. If you look, we’re the only country in the world where 61% of radio is consumed not in a car or in the home, but on mobile devices. And that’s where the first introduction of digital happens to the consumer. Most of the people that you see with earphones plugged in to their ears are people listening to FM radio. And FM is truly the most local form of media penetration that you can achieve because it is so local and city-centric. And therefore, it opens up a huge opportunity for a company like us for attracting retail advertising. And that’s how we push the value chain from retail to all our other businesses. Coming to print, it is a tough market for us to break in to because it (reading newspapers) is a matter of habit. Even if you ask somebody tomorrow as to which newspaper they read, despite which newspaper they read, they will only recall a masthead which is cool to be talked about. So from that perspective, while print is still growing through this country, given that we’ve not achieved full literacy levels, vernacular print will grow faster compared to English print. And we are present in English print and therefore it is a slowdown that we are seeing. But it is a business that we still value and we are going to nurture and grow.

AR: You mentioned the issues of both FM localization and vernacular print. Now talk to me about languages. Suddenly, languages are exploding everywhere and even in the digital space, you’ve got profitable businesses. So what is your focus on languages? On TV, you’ve done a lot, but outside of TV?
PG: So outside of TV, we have a great focus on languages when it comes to our digital platforms. So we are already curating and publishing content in almost eight languages outside of English for the country. On our new digital platform that we intend to launch within the next few weeks or months, we will have content in 12 languages, of which 10 are non Hindi and English. We will also have 11 user interface languages to launch with, which will be a key differentiator to our product. I believe in this country, content consumption or entertainment consumption will only thrive in the preferred language of viewing, which is their mother tongue.

AR: Now go back to your focus areas. Let’s talk about live entertainment. Live (entertainment) also is hugely dependent on local media, as in radio, print, etc. So how do see live going? While you did say a lot of it is going to be taking Indian talent internationally, there’s a lot that can be done within the country as well. So take me through what you have planned.
PG: On the live front, we have two verticals. One is the theatre vertical, which I’ll talk about first. We’ve already had an eight-city tour that we’ve conducted this year, with about 70 shows that have happened. And this is purely for the people who love the original form of entertainment, which is live performance of shows. We have bought into the IP of those, or we have partnered with the creators of the IP where we have scaled that up and represented it to audiences in a bigger and scaled up manner. Similarly, the same IP we can travel and take to international markets. We are also looking at, and talking to, big international companies that do live events, or live performances, etc., to bring great IP into India. And I’m not talking about just EDM (Electronic Dance Music) and that kind of entertainment, but real entertainment which people can sit back and enjoy the true sense of theatre that we lack today in this country. It’s a very nascent business, very, very, small today for us, but I believe the opportunity is going to be huge.

When I say live, I mean spanning from concerts to food festivals to theatre going audiences, etc. The infrastructure in this country is lacking so much that nobody really is focusing there.

AR: So where’s the money for live? Where does it come from? Obviously, ticket sales are one, sponsorship is another, and brands are another.
PG: So you’ve kind of answered the question yourself…
AR: (Laughs). Some depth please.
PG: (Laughs). Okay. So let me give you an example. One of the first events that we did, and which is still running, is called Baleno Wicked Weekends. It’s 40 events that weve done across the country, where we’ve partnered the Baleno or Maruti Suzuki. They’ve done a great job in showing us the way forward, that they are willing to partner with us, where even small audiences are integrated with our event business and the brand. So it’s a cohesive mixture of the brand, media owner and audiences coming together. So we intend to do a lot more of these in the future, going forward.

AR: So you’re going for quality of audience rather than quantity?
PG: I would like to think so. I mean, if I give you a small example, the largest live business company in the world does a live event every three-and-a-half hours. Now why can’t we envisage an Indian company that can go across the world and entertain the world on that similar scale? So from that perspective, that’s the objective that we are looking for.

AR: Punit, you’ve got all these pillars that several media companies of the world have. But you got in to sport very early, and you got out of sport completely. So why is that?
PG: When I got in to sport Anant, ten years back, we always felt that it will be a business that will turn around in three years or so. And this is always on the back of the presumption or forecast that subscription revenue landscape will change in this country. That we would go from a Rs 150, Rs 180 ARPU market to a Rs 500, Rs 600 ARPU market. Ten years since then, we haven’t moved the needle to beyond maybe Rs 250, Rs 300. And the business of sports, will not move until the subscription revenues move. Because advertising revenue in sports is so event-led that you can’t sustain a sports business over a 12-month period. So from that perspective, I felt that we could grow in these different verticals that we are investing behind much faster than waiting for the sports business to actually mature.

AR: So are you saying that sport is not closed? Supposed ARPU does go to Rs 500, Rs 600, is there a case for Zee to get back in to sport?
PG: My non-compete with Sony Pictures is till February 2021. Nothing in my business is ever closed. We are always open to look at opportunities that we have let go, opportunities that we may merge in the future, and if the landscape of monetization of the sports business changes, why not, we will look at it.

AR: I’ll now come to the million-dollar question, which is about money. So how do you see the monetization change from now to the foreseeable future? How does the pie change, say, five years from now? How much will come from advertising revenue, how much will come from distribution, from live entertainment, etc.?
PG: As I said, the new verticals, the three that we talked about, if they are less than 35-40% of my revenue, I’ll be very, very disappointed. So if today is at, let’s say, a ballpark of Rs 7000cr of topline, and it’s growing at a CAGR of 12-14%, that’s the kind of number we are looking at coming from the new verticals itself. Having said that, television itself is still growing. So the race for the new verticals to compete with television both on advertising and on distribution revenues is going to be tough and difficult. But as I said, the film vertical, this year itself, will achieve 8-9% of our topline numbers. I’m pretty confident that this company is now ready for that level of growth and to take it to the next level – from an $8bn kind of company to the next level — maybe a $50bn company.

AR: Thank you Punit.
PG: Thank you Anant.