The numbers are simply dazzling
Among his various Mumbai-based enterprises, Indian media mogul Subhash Chandra owns Zee TV, which is run by his eldest son, 35-year-old Punit Goenka. In addition, Chandra’s Essel Group owns the Indian newspaper chain DNA, cable systems and a direct-to-home satellite operation.
The 63-year-old Chandra founded the Essel Group (which in 2011 recorded revenues of U.S.$4 billion with 8,000 employees) in 1976 and in 1992 entered the television business with Zee TV, India’s first satellite television channel and the country’s first private TV network. Today, various Zee TV channels and other companies are grouped under Zee Entertainment Enterprises (ZEE) with its employees holding a three percent ownership.
In the U.S., Essel owns Veria Living, a lifestyle TV network started in 2008 that is now available in 25 million cable and satellite homes. In 2010 Zee TV joined Veria in its New York City offices.
In an interview with VideoAge, Chandra explained that the name Veria doesn’t refer to the Greek city, but to a variation of the Latin word veritas (truth). During VideoAge’s interview, Veria’s Chief Revenue Officer, Ray Donahue, mentioned that, in addition to selling Veria’s content, he’s also looking to buy programs “that fit into the health and wellness space [including] lifestyle and exercise.” He’s interested in both finished product and those that require further funding.
According to Chandra, Zee TV has 34 channels in eight Indian languages and three in English, with 95 percent of programs acquired internationally. The rest of the channels are programmed exclusively with local Indian productions. Reportedly, the overseas business, which includes 29 global TV channels, contributes 25 percent to Zee network’s profitability.
“Zee is extremely strong on the international front. Our reach has strengthened to over 700 million viewers across the globe, with presence in 169 countries,” said Goenka, managing director and CEO of ZEE. Goenka joined the Essel Group in 1995, first heading its music division and later its various telecom holdings. In 2004 he moved to Zee TV and became its CEO in 2008.
He explained that, “Our vision is to be ranked amongst the top three global media brands and to reach a billion viewers [worldwide] by the year 2020.”
According to Goenka, over the past two decades, ZEE has grown at a “double-digit rate, outperforming the overall TV industry’s growth rate.” During a presentation at MIPCOM 2013, Goenka pointed out that “any investment that doesn’t give a 20-25 percent return is a bad investment.” And this in a highly competitive Indian TV market with 300 FTA channels and 125 pay channels, and with subscription services costing about Rs250 per month (U.S.$4). More than half of India’s households (HH) own a television set. Of these, 103 million TVHH have access to cable TV or satellite.
He noted that the business objective of niche channel offerings at Zee is to generate subscription revenues, stating that they “have implemented innovative content approaches in their respective genres, especially the latest channel, Zee Q, which is targeted toward kids and offers innovative content solutions to cater to the information-based programming market.” Other niche channels that perform well within their respective genres are Zee Khana Khazana and Ten Golf.
Goenka said, “on the distribution front, the strategy is to tie up with leading local distribution networks in international territories to ensure a wider reach. In markets like the Middle East, we have already started producing local content to suit markets.”
As an example, Goenka noted, “With the launch of Zee Bollyworld, we have taken Zee to international shores. In line with the corporate strategy, ZEE has been successful in syndicating premium Indian entertainment content.” ZEE’s library consists of over 100,000 hours of original programming including drama, thrillers, comedy, kids, movies, events and non-fiction shows.
As for challenges, Goenka mentioned that on the domestic front, audience measurements represent a problem with only 10,000 TVHH being sampled; but that will soon to be extended to 100,000 TVHH. As for revenues, currently Zee TV generates 65 percent through subscriptions and 35 percent from advertising, but “in three-to-five years” he expects the ratio to be 50-50, considering that “India is the fastest-growing TV market in the world [and] the world’s third largest TV market [in terms of viewership].”
During the VideoAge interview in his New York City office, Subhash Chandra also explained why he chose to turn his middle name into his last name, explaining why his last name is different from that of his three children, including Punit.
Chandra was originally known as Subhash Chandra Goenka, but changed his name in 1989 because he felt that independent India was being divided by the political establishment and he didn’t want to be associated with the caste confrontation raging in the country at that time.
This part of his life will be expanded on in his autobiographical book, which will soon be published by HarperCollins, a company that happens to be owned by his TV competitor in India, Rupert Murdoch.
The American-accented Chandra only completed high school, shattering his dream of becoming an engineer. The family business suffered a series of drawbacks in 1967 due to heavy losses in cotton trading, and Chandra’s father told him that he had to help with the business, as he could no longer pay for college. Two years later, in 1969, he renamed the company Subhash Chandra Laxmi Narain and in 1976 he gave it the name Essel Group of Industries and later, Essel Group. Chandra entered into the packaging business in 1981, with Essel Packaging Ltd. and, in 1988, he set up the amusement park known as Essel World. He’s now India’s 21st richest man with a net worth of U.S.$2.9 billion.