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Was it Just a Gimmick?

Movies Now has Created Ripples in The English Movie Channel space with its HD Offering in a Fairly Short Span of Time. Can it Sustain this Iconic Rise?

Even discounting the impact of translations, Hollywood has gained immense popularity in certain parts of India. Indeed, English movie channels have played a key role in bringing about that transformation. But unlike the upheaval that the box office typically goes through every week, the English movie channel space in India has seen fairly little flux in terms of competitive positions for quite a while.

Star Movies has been heading the genre since years; with HBO at a comfortable number 2 and Sony Pix at number 3. Expat entrant WB and the others contenders like Zee Studio, UTV World Movies and Lumiere have remained specific to their content and positioning, by not catering to the mass market. The competition has drastically increased for local broadcasters with multinationals tying up with local broadcasters to cater to niche categories, which mostly directs towards the core audience of 15-35 SEC AB M/F. Ad rates have seen a constant increase over the years, with major revenue earnings for broadcasters. 2010 has also been a virtual walkover for the English movie channel category, with Star Movies ruling the roost (refer to ‘Wars on the English front’, 4Ps Volume 5 Issue -13, July 2-15, 2010).

However, the streak recently broke in January, when the TAM research report revealed that a new entrant has suddenly topped the segment within 4 weeks of its launch and dethroned Star Movies. This challenger is Movies Now, a baby of the Times Group, which, in a short span of time, is already showing the muscle to change the game in the English movie channel genre.

Movies Now was launched in the second week of December by Times Television Networks, with the clear USP of ‘Hollywood in HD’. Sunil Lulla, MD & CEO, Times Television Network, comments, “Movies Now challenges the status quo of the category to ensure the audience the best of entertainment. With its first of a kind, state-of-the-art HD Broadcast facility. Movies Now will furnish upscale Indian audiences with clearer, crisper picture quality, superlative sound quality and a wider viewing experience.”

Movies Now is the 4th offering from the Times Group after Times Now, ET NOW, & ZOOM, which cater to multiple audiences in Australia, Maldives, Kenya, Nepal, Tanzania & Uganda, besides India. Company sources say that the average TSV on the channel is 58 minutes, while the closest competition records an average TSV of 32 minutes. The average GRP of Movies Now is 26 points, which is the highest in the category. (Source: TAM Media Research, TG: CS 15-34 AB, Period: 4 weeks average of week 52, 2010-week 03, 2011; Markets: Top 8 Metros).

The channel’s advantage has been the fact that it identified a competitive gap in the market, and developed a POD of providing movies in HD 1080i pixel format; giving viewers the best audio-video 5.1 experience. Star Movies and HBO were looking to launch the same for a while, but the aggressive launch by Movies Now has caught them unawares. TAM ratings for 8 weeks: Week 52, 2010 – Week 7, 2011 across the 8 metros clearly define the channel as the leader in the category with 34% market share. The launch of the channel has not only challenged the status quo of the English movie channel category, but has also catapulted the growth of the category by 43% from 50 GRPs to 72 GRPs.

However, a better viewing technology isn’t enough if the content as well as the packaging is not up to the mark. English movie channels have been starving to tie up/acquire new movie studios in order to increase the number of movies in their libraries. It has remained quite a challenge for the new babies to add on newer content as most of the major international movie studios have already tied up with the leaders while the others face content issues. Movies Now focused on showing all time favourites and blockbusters with the HD experience. Ajay Trigunayat, Channel Head, Movies Now, says, “We have received much success with our programming initiatives like – Rocky Reloaded; Loveboat and Moviethons. Viewers can look forward to an exciting line up ahead, where we plan to show 40 new titles in March.”

Also, the reach factor is important and tie ups with DTH players are being attempted. Movies Now went the traditional ‘desi’ way by sticking to the basics and tying up with almost every possible cable service in India (like Hathaway & Digicom), and now the penetration has reached about 95%. They are still not available on most of the DTHs, which has been seen as a major priority for the new TV buyers.

Is the decision on the money? Actually, the market has become a mixed bag with the introduction of DTH, IPTV and Digitalisation of the last mile in the Cable TV Sector. The TRAI annual report 2009-10 confirms that 66% (Rs.169 billion) of the revenue of Indian Television Industry is attributed to subscription from consumers and 34% (Rs.88 billion) comes from advertisements. It must be noted that Pay TV homes have reached 90 million in 2009 from 60 million five years back; of which DTH has contributed 20 million homes and cable has added only 10 million homes.

Interestingly, DTH is showing huge growth in rural India, having increased its penetration to 64% in 2010 as compared to 49% in 2009 and 34% in 2008 as per TAM data. KPMG Entertainment Outlook 2010 reveals that DTH has witnessed a growth from 9 million in 2008 to close to 14 million in 2009 (expected to reach 50 million by 2014). Cable subscribers are close to 169 billion in 2009 in comparison. This proves that investing in cable is a great strategy at the moment. But Hollywood viewing has a lot to do with metros, and Movies Now has to consider that DTH is spreading fast in the metros as a revenue source. The share of pay-DTH among all DTH households in urban India has increased from 73% in 2008 to 86% in the year 2010.

The HD channel has assigned its creative duties to Bartle Bogle Hegarty India to handle its creative communication campaigns and do the print, radio, outdoor and BTL campaigns. BBH already handles some key accounts like Vaseline, Vat 69, Star Alive, L&T insurance and Marico. “The market will grow and the channel has been doing good. It will largely be driven by its content, transmission quality and the type of movies being played. Also, HD will keep it away from the heat,” said Harish Bijoor, Brand Consultant.

To be fair, Star TV and HBO can bounce back. They are planning to launch HD themselves and will also be leveraging their strong content expertise which has been built over the years. By taking a lead over them in this aspect, Movies Now has entrenched itself well into the category. And considering that it has the backing of the Times Group, dislodging it from its perch will not be a cakewalk now; even though it will have to be very aggressive on the content acquisition front.



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