NGC India currently operates NGC and the History Channel, and claims it is making a profit from its India operations. NGC's managing director for South Asia, Nikhil Mirchandani, talks to Ashish Sinha on what the new launches will mean for the company as well as his take on the regulatory environment in the country.
Why four new channels at one go?
NGC has been here for the last 11 years and History Channel for about five years. We are adding four more high-quality channels because they are new offerings for the NGC group globally. The four channels have been launched in last couple of years and we think we have been quick in bringing them to the Indian viewers.
What does this mean for the advertisers and which platforms will you use to launch the channels?
For the advertisers, there will be more opportunity to deliver their advertising messages. The six channels will help expand this category. In the first phase, we will launch four channels. In the second phase, we will look at local, India-centric content for them. We have applied for the downlinking licences and we hope to get them within four weeks' time. The existing as well as the new direct-to-home (DTH) service providers will be a good opportunity to showcase our channels along with the cable services.
Pay channel pricing for DTH is regulated by TRAI. With a bouquet of six channels, wouldn't you look at commanding a better price from the DTH operators?
We are aware of the regulations that we cannot sell bouquets to the DTH service providers nor can we price our pay channels more than 50 per cent of the prices in the non-CAS cable homes. While we are yet to take a call on the pricing of our new channels, one thing is clear - we will fully comply with all the regulations. The regulations are here to help the market grow and we fully support them.
Will your bouquet continue being distributed by Star's distribution team that is now functioning as Star-DEN?
We have a long working relationship with the Star Group. I see that continuing in the future too. Both distribution and advertising revenue are important for us. Last year, of the total revenue, distribution accounted for over 60 per cent. This year, the ratio is 50:50 between distribution and advertising and it should stay like this for some time even as the advertising spends of companies increases.
Are you the market leader in this genre?
No, we are not. We are a little behind Discovery. We should be 70-80 per cent of what Discovery generates in terms of advertising revenue. But with more channels under our belt, things could change very fast.