Fox's Star India CEO Talks Content Strategy, Digital Growth, Working for Murdoch
21st Century Fox-owned Star India is India's largest TV company and has been a growth asset for Rupert Murdoch's entertainment conglomerate.
Star India CEO Uday Shankar on Friday will speak at a New York breakfast event at Paley Dialog, organized by the Paley Center for Media. Shankar will be introduced by 21st Century Fox co-COO James Murdoch who had on Wednesday touted the growth outlook for the Indian business, saying it could eventually top operating profit of $1 billion a year.
Shankar will discuss how Star India has used programming to spark national discussions on a range of social and political issues. Among others, hit talk show Satyamev Jayate, hosted by top Bollywood star Aamir Khan, is in its second season and continues to put the spotlight on topics moving the country.
Star India operates 34 channels in seven languages, which it says reach about 650 million viewers every week.
Shankar on Thursday talked to THR international business editor Georg Szalai about the Indian TV industry, viewers' appetite for Bollywood and Hollywood content, Star's digital dreams, the importance of putting the spotlight on social issues in India, the involvement of Fox executives and whether Star is looking for deals as Fox-controlled pay TV platforms in Europe have been discussing a combination.
THR: Star India has been successful with programs that spark national discussions on a range of social and political issues. Why has that been so important to your ratings and business success?
Uday Shankar: We are in a stage of evolution at Star India. When Star launched more than 20 years ago, its proposition was the best in the world would be made available to India. But we realized that to differentiate ourselves and live up to the full potential of media content, we have to challenge the status quo and push the envelope. Based on that, we built a pretty unique identity as a company that is cutting-edge in terms of creative decisions and that challenges everything that is traditional and cliche. That has put us in a unique position where the aspirations of a large segment of Indian society have been increasingly articulated by Star. When we make a drama or other content, Star is capturing the essence of what a segment of Indian society wants.
THR: What role do your K serials that feature strong female characters play here?
Shankar: Women are a [group] we focus on very heavily. We never portray women in regressive ways. Indian women want change for themselves, their families and their country, and Star is leading that change. So, every show centering on women captures the journey of Indian women.
THR: Tell us a bit about Satyamev Jayate, Star's hit talk show about India’s pressing social topics, which has been a big hit with Bollywood star Aamir Khan exploring sensitive issues, including child abuse and foeticide?
Shankar: We started it in 2012. We had taken small slices of society and captured their aspirations and agenda. Then we thought about stepping back and taking a much more comprehensive look at the issues in Indian society. The essential driver of the show was if all of us were convinced that we wanted to create a better India, what are the social issues that must change. That's how the show came to be.
THR: How did you get a big Bollywood star to host the show?
Shankar: Aamir has had an interesting journey. He started as a very successful mainstream actor who played romantic and action roles with great success. Over the last 10-12 years, through his films and characters, he always stood for change. In 2009, he did a film called 3 Idiots, which was one of the most successful films in Indian history. But it also [provided] a very sharp...commentary on the Indian education system. When I saw the film, I went to Aamir and said you need to harness the potential of TV. That is when the conversation began. He had never done TV, but he had always found the power of TV fascinating and was very keen to use the range of feeling to create content that would trigger social change. His team and our team worked together on the show for almost two years.
THR: Since we are talking about a Bollywood star...how key is Bollywood content for Star?
Shankar: Bollywood content is a very important part of our portfolio. When you reach out to 650 million people out of a TV audience of 800 million-850 million in India, it is a very important part. We have two Hindi language channels dedicated to Bollywood films. In other Indian languages, such as Bengali and Tamil, we have local films showing. These films are very, very important. However, the core proposition of Star network is unique proprietary content. Bollywood has done remarkably commendable work over the last 10 years, particularly in terms of creating diverse content from art-house-type films to mass-market cinema. However, the Star network has been built on the back of sharp in-house creative innovation and very eclectic usage of talent from the film and TV world. The biggest-ever Indian film star, Amitabh Bachchan, in 1999 became the first big star to work on television when Star engaged with him to do the Indian version of Who Wants to Be A Millionaire. Almost every A-list actor has been on one or the other Star show - from Shah Rukh Khan to Aamir Khan.
THR: What role does Hollywood content play on Star channels?
Shankar: When you have reached the depth and scale of Star India, you must offer people the best in the world. We take that very seriously. Hollywood content is very, very important to us. There is some built-in limitation, because only a small segment of the population can understand and appreciate English-language content. But for them, it is very important that we give them best-in-class content.
For example, a year and a half ago, we became one of the first broadcasters outside of the U.S. that launched a network that gave Indian viewers the best of Hollywood drama within 24 hours of when it was broadcast in the U.S. An episode of Homeland would go on air within 24 hours. We did deals with multiple studios and persuaded them to let us air the content with 24-48 hours delay. I think that was one of the most disruptive moves, because content had always found its way to pirate sites once it had aired [in the U.S.]. This was an expensive channel for Indian viewers with niche viewership. But to these niche viewers, it was important.
For Hollywood films, we have two channels dedicated to them. We have deals with a large number of Hollywood studios, including Fox, Disney and Universal, to pick up the best movies. Our share of viewership is almost 52 percent of all English-language viewing in India (compared to 24.8 percent overall TV audience share in India).
THR: So, you really try to reach people with different interests...
Shankar: We decided to straddle the diverse geography of India in various languages and the various genres - from drama to sports, reality and films.
THR: How do you make sure you have the budget for all this content and what role does Fox play in allowing you to spend money?
Shankar: Our bosses at 21st Century Fox understand that we are building a business for the future. India is a market that James and Rupert [Murdoch] are convinced will be a substantial market. So, a lot of these investments are made with a sharp eye on the future. The story of Star is the story of consistent investment over the last 20 years. That continues because we have invested in good content and developed a reach. We have managed to get a very attractive leadership premium from our advertisers. And we also approach our business as a portfolio. We don't look at it and think that each program and channel must individually make money, because we have such diverse audiences at different stages of their evolution. We invest today in building a market for tomorrow.
THR: What do people and companies from abroad not understand or misunderstand about the Indian TV market and how does this give Star an edge?
Shankar: A mistake that a lot of people and global media companies have made in India is to bring a business model and start working with it in India. That doesn't work. It is a very different country. It has so much diversity - social, economic and more. So, you have to become an insider when you try to build a media business in India.
Our philosophy is that media content must challenge the status quo. If you are not challenging the status quo, you waste the opportunity. It's not only the right philosophical, but also the right business approach. It is a market in evolution. You can not just try to continue with local practices. You need to understand existing practices and question them. That's what we have done consistently and successfully. That remains our biggest opportunity, because we have done it over such a long period of time.
When I talk to my friends in American media or global media, my only advice to them is when you come to India, do not bring a global business model on your computer. Just look around and create your own local business model. That was what 21st Century Fox, which back then was News Corp., was very convinced of and that is what Rupert was very convinced of all the time. That is one reason why Star hasn't imported that many international shows or international managers or business practices. My bosses never come to India and say this is how we do things in America. We understand the lay of the land so well.
THR: What do you see as your biggest challenge?
Shankar: The biggest challenge is how do we continue to change the game. Indian society is changing and will continue to do so. To get the right talent on the scale and volume that we need to sustain our initiatives is a challenge.
THR: Following India's elections, which swept into power new prime minister Narendra Modi, what expectations do you have from the new government for the media and entertainment industry? And what changes would you like the new government to implement for the industry?
Shankar: It is too early to say. The party has been in power less than a week. But one thing I know is that they are very focused on creating jobs and accelerating growth. One of the sectors that can play a huge role in that is media, because the media business in India is still much smaller than it could be. A couple of years ago, I came up with the slogan of creating a $100 billion media business in India. Now the media community accepts that this is a realistic target. We are at less than one third of that goal right now. Whenever a new government comes to power, it is the responsibility of the industry to educate it and make a case to the government.
THR: Fox's European pay TV platforms - BSkyB in the U.K., Sky Deutschland in Germany and Italy's Sky Italia - have considered a merger. Any need for Star to get bigger via deals?
Shankar: We are not closed to the idea of making opportunistic acquisitions. We have done that in the past. For instance, we acquired a small South Indian network, Asianet, and have built that into a bigger, more successful network. But I believe that given the limited number of high-quality assets in India and given their cost, it is much better for us to build organically. It takes a long time, but we have a very strong management and leadership team.
Another example is we had a joint venture with ESPN for sports networks, which worked well for a long time, but a couple of years ago, we decided to go our separate ways and amicably agreed to buy out ESPN. Now we are focusing on building that sports business. This is the first time that any broadcaster is working to build multiple sports from ground zero - we are building an Indian soccer league, we are working to create an Indian hockey league. It is slow, but when you build something, the foundations are more rock solid than in the case of acquisitions.
THR: How's your digital business and any big future plans you are focusing on?
Shankar: We have built a very robust television portfolio, but digital has been growing very, very strongly in India lately. Mobile content consumption has been growing. Most companies have been piggybacking on Google and YouTube. We decided instead of piggybacking on YouTube, we would invest and build our own digital platform. Last night, there was this big cricket playoff game in India, and starsports.com [India's first multi-sport digital service] got 2.8 million unique viewers, which is more than twice the size for any other big event in India. It was also bigger than what NBC delivered for the Olympics earlier this year [on its biggest day].
We have launched this big sports platform, and now the idea is to strengthen that with an even bigger entertainment platform. Building a robust best-in-class global entertainment and sports digital franchise for Indian content is the next big agenda.