This article comes in todays The Hindu Buisness line.. nothing to do with KTH but only to tell you all the Star and Ekta connection...
Balaji Telefilms is poised to get a hike in rates for the commissioned programmes that it supplies, especially to the Star network. Star Plus depends on Balaji Telefilms to attract prime-time audience.
The buoyant trend in ad-spends suggests that Star Plus may have to have offer higher rates when they are reset next time. This is likely to go straight to the bottomline.
Ms Shweta Tiwari There has been anecdotal evidence of audience tiring with the themes of the long-running soaps, such as
Kyunki Saas Bhi Kabhi Bahu Thi, Kahaani Ghar Ghar Ki and
Kasauti Zindagi Kay. But no decline in the measured audience share of these programmes has been recorded. Dramatic twists at right intervals have helped these programmes overcome audience fatigue to a large extent. These twists may strain credulity, as the storylines are pushed forward to encompass different generations.
Ms Ekta Kapoor This has, however, been Ekta Kapoor's — the brain behind Balaji Telefilms — staple strategy to rejuvenate these serials from time to time.
A couple of serials of more recent vintage such as Kahin To Hoga and Kavyanjali have also stared to consistently figure in the top 30 programmes on prime time. This aspect, too, could strengthen Balaji Telefilms' case for a higher price card for its commissioned programmes. These fetch a fixed price for the content provider from the television channels. Equally important is the margin story.
Ms Smriti Irani A combination of lacklustre revenue growth, a steep rise in production costs and a higher compensation to retain talent have eroded margins at an alarming rate. Though at 35 per cent, its margins last year were still at levels many a company would have gone a long way to enjoy, Balaji Telefilms' was used to figures 50 per cent-plus. This explains the magnitude of the effect that the margin-decline story had on earnings. But the worst appears to be over on this front. A higher degree of stability and a likelihood of margins rising by a few percentage points are positives for the earnings growth.
The company recently started a couple of serials on Sony and Zee. If these programmes gain a higher audience share, they could provide new revenue streams. The proliferation of channels in the Hindi entertainment as well as in the South Indian language space also creates an opportunity for enhanced content generation.
Though the Star group holds a 25 per cent stake in Balaji Telefilms, it has not restrained the latter from producing content for other channels. It is, however, the Balaji serials on the Star Network that will hold the key to its performance. There are not many slots available either in the evening or afternoon prime time band on Star Plus; this is a factor that could link growth from Star Plus to hike in prices for commissioned programmes. Now you all understand why Star always support Ekta and cannot go beyond her.
Vasudha
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