can ronnie screwvala cast a spell in television_ _ business today

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Can Ronnie Screwvala cast a spell intelevision?Ajita Shashidhar July 31, 2013

It was St Valentine's Day. The year was 2008. Ronnie Screwvala was on tenterhooks.

It was not the kind of anxiety some men, with certain intentions, experience on the day. It was

the premiere ofJodhaa Akbar, co-produced by Screwvala's UTV Motion Pictures with

director Ashutosh Gowariker. It had cost Rs 50 crore to make and was UTV's most

expensive project yet.

The same day he had spent four hours in a conference room at UTV's broadcast arm's head

office in New Delhi at that time, watching a presentation on the company's two movie

channels slated to go on air a week later.

As his team went through the slides on the two channels, UTV Movies and UTV World

Movies, Screwvala's eyes stayed glued to his phone. But every time the team thought he

might not be paying attention, he would ask a question that would make them think again.

Two days later, Screwvala sprang a bigger surprise on his team. On a hurriedly convened

conference call, he said Walt Disney Company was going to more than double its equity

holding to 32 per cent in UTV Software Communications, the group's motion pictures,

gaming and television content arm. The United States-based entertainment behemoth would

also acquire 15 per cent in UTV Global Broadcasting, which, as the name suggests, was the

company that owned the television channels.

"During the presentation on the new channels, Ronnie was

actually giving final touches to the deal. So he was doingthree things at a time: listening to us, coordinating for

Jodhaa Akbar's premiere, and sealing the Disney deal,"

recalls Pankaj Krishna, CEO, Chrome Media, a data

analytics and media research agency, who was then the

business head for the two channels.

Screwvala attributes his multitasking skills to his dalliance

with theatre 35 years ago. "To be in front of a live audience
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businesstoday.intoday.in/storyprint/197083 2

requires confidence and improvisation. You may have a

scripted line, but, unlike in the movies or anywhere else,

you have nothing other than the rehearsals [to fall back on].

You can't stop and bring down the curtains and say you

have forgotten your lines." Almost four years after that whirr

of activity, Screwvala raised the curtains on a new career in

December 2011. He sold all his equity in the UTV

companies to Disney and became an employee of DisneyUTV, the merged entity, though richer by Rs 2,000 crore

from the deal and designated managing director. Those

who knew him - or thought they did - as a driven

entrepreneur still cannot digest the transformation.

Screwvala has something more difficult to swallow. He has

yet to wipe off the trace of that Valentine's Day five years

ago. Jodhaa Akbarearned Rs 95 crore at the box office to

become the highest grosser of the year, but the twotelevision channels launched a week later fared very

differently. UTV Movies has never risen above number four

in its genre and its advertising rates are less than a third of

what rivals Star Gold and Set Max command. UTV World

Movies has no rival, but not too many takers either.


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Uplifting, family entertainment will be the broad framework: Siddharth Roy Kapur, MD, Studio, Disney UTV Photo:

Nishikant Gamre

Today Disney UTV is king of the Bollywood box office. It produced five of the 10 Hindi movies

that have hit the jackpot this year. Its television business, though, has continued on the

journey started five years ago without getting too far.

A Yen for the Movies

Screwvala's knack for all things movies was in evidence as far

back as 2006. His old faithful Siddharth Roy Kapur, who has also

stayed on with the merged entity and heads its movies business,

recalls the film Khosla Ka Ghosla coming their way because no

production house would touch it. A simple tale of a family losing a


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plot of land and reclaiming it through some earthy ingenuity, it did

not excite the Bollywood minds fed on glitzier, spicier stuff. It did not

help that Dibakar Banerjee, who had directed the film, was a

nobody from Delhi and had no connections in Mumbai.

"By the time the film came to us the print was full of scratches and

seemed ancient. But the moment Ronnie saw it he was excited.

And his belief was that if all of us were excited by the film so wouldbe the audience," says Roy Kapur.

UTV spent Rs 2 crore on marketing the film, which had been made

at a cost of just Rs 3 crore. The film went on to earn more than Rs

10 crore at the box office.

"That was the first instance in which UTV displayed its marketing

prowess," says Roy Kapur.

With the passage of time, that prowess has only grown. In the last

six months, Kai Po Che!, Yeh Jawaani Hai Deewaniand ABCD - all

UTV releases - have brought in 42 per cent of all box office money

earned by Hindi movies. Yeh Jawaani Hai Deewani, co-produced

with Karan Johar's Dharma Productions at a cost of Rs 50 crore,

went on to make Rs 189 crore. Kai Po Che!was an even bigger

delight to the bean counters. It yielded a nearly 6x return (cost of

production: Rs 12 crore, box office revenue: Rs 70 crore).

Earlier, Barfi!, made at a cost of Rs 30 crore, raked in Rs 166

crore, just a whisker behind stablemate Rowdy Rathore, which

brought in a crore more, but had cost Rs 55 crore to produce.

Johar, the man about tinseltown, who also worked with UTV to

produce Wake Up Sidand I Hate Luv Storys, says Screwvala is

part of a rare breed that understands the magic as well as the

economics of filmmaking. "He is instinctive and his assessment is

usually bang-on." Johar refers to the ease with which Screwvalaand his team made a Bollywood potboiler like Rowdy Rathore as

well as sensitive tales like Kai Po Che!and Paan Singh Tomar.

It is not that UTV has hit the bullseye each time. In the last 12

months, Himmatwala and Jokerwere the joke of the town for the

gap between the hoopla and the moolah they generated. Joker,

made at a cost of Rs 40 crore, did not even recover its cost at the

box office. However, good-old de-risking pushed it comfortably over
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the line by garnering Rs 20 crore in satellite, television and music rights. But no one could

help Himmatwala, Hindi for the man of courage.

The Elusive TV

Screwvala did not start out with movies. He entered the broadcast industry in 1990 hawking

content. He made Saanp Seedifor Zee TV, based on the popular board game snakes and

ladders, which lays claim to being the country' first reality show. He entered the world of soap

operas in 1994 with Shanti, starring a more fetching Mandira Bedi wearing designer bindis.

But it was not the usual prime time warrior. Shanti helped open up the afternoon hours for

soaps. He started his own channel in 1995, but again with a difference: TSN was India's first

home shopping channel. It did not get much purchase and was making annual losses of Rs

100 crore in 2001 when Screwvala decided to shut it down. "TSN was ahead of its time," hesays. "The consumer wasn't ready for it. She wanted to touch and feel the products. The

credit card penetration was also low at that time."


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His second shot at broadcasting came when TSN was still on air. In 1998, Screwvala

acquired Vijay TV, a Tamil channel from Vijay Mallya's United Breweries. Later he made it a

joint venture with Star India and the channel managed to garner 12 per cent of the Tamil

general entertainment market. But he exited it in 2004. "I exited Vijay because it needed huge

investments and we didn't have that kind of scale."

Movies happened alongside. The first was Dil Ke Jharoke Mein, which Screwvala produced

way back in 1997 - it is a film few would remember now. Taking a break from production, he

distributed Major Saab, starring Amitabh Bachchan, in 1998 in a few territories and hit the

jackpot with Aamir Khan's Oscar-nominee Lagaan in 2001. Riding on the impetus, he got into

co-productions and made Chalte Chalte with Shah Rukh Khan's Red Chillies Entertainments

and Swades, another Khanstarrer, with Gowariker.

It was time to put an end to the ginger steps. Screwvala took the plunge and moved to the


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studio model with Rang De Basantiin 2006, taking care of everything from content creation

to marketing and distribution. Winning commercial as well as critical acclaim, the film set

him on a path that has brought him to his current hegemony over the box office.

But, somewhere along the way, television was left behind.

There was Hungama, a channel for children Screwvala started in 2004. It became number

one in its segment before Disney bought it in 2006. More than the $30.5 million the deal

brought in, it started UTV's relationship with Disney. And this is what Screwvala is banking on

to extend his purple patch into television.

He will need a generous dash of that colour. Looking at it one way, he has done everythingright in television, while sticking to his theme of doing things differently and leveraging his film

content. Bindass was the country's first youth-centric entertainment channel, targeting the

15-24 age group. It had just a couple of hours of original programming and that too only

during the weekends.


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The rest was film and music content, which needs to be paid for just once. A regular

entertainment channel, on the other hand, has at least four to five hours of original

programming, which has recurring costs.

In a country with half its mammoth population below the age of 25, it could have been a

masterstroke to focus on the youth. But the analogue distribution system tripped up

Screwvala. Carriage fees were as high as Rs 30 crore a year. Penetration was difficult.Thing are looking better with growing digitisation and Bindass's reach has risen from 66 per

cent of the total television viewing homes to 82 per cent, according to channel tracking firm

Chrome Track, Chrome Data Analytics and Media.

"Digitisation has been a shot in the arm. Our ratings have increased substantially as our

reach increased," says M.K. Anand, MD, Media Networks, Disney UTV. The broadcast arm

has recently picked up a 26 per cent stake in IndiaCast, the distribution arm of Viacom 18,

which distributes over 35 channels. This, claims Anand, has given him much-needed might


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to negotiate with cable operators.

It may take a little more than browbeating cable operators to turn things around. There are

five UTV channels in the fold. Of them, the two Hindi movie channels (UTV Movies and UTV

Action) together get gross rating points (GRP, the most widely accepted measure of

viewership) of 76. Segment leader Set Max alone gets more than twice as much. Bindass is

doing well with 50 GRPs, but is behind youth segment leader Channel V. UTV Stars, in the

same segment, has to make do with just 14 GRPs.

The four Disney channels - Disney, Disney XD, Disney Junior and Hungama - provide

succour, together pooling in 327 GRPs. The flagship Disney Channel, which had a 69 per

cent reach before digitisation, now has a 77 per cent. It leads the children's segment along

with Pogo - the two are neck and neck.

The Professional

In his new avatar as the Disney UTV MD, Screwvala wants to approach the business the old

way: differently. He won't touch the general entertainment segment, something he hasavoided all his career. Screwvala's plan is to take forward the Walt Disney ethos of creating

intellectual properties and building franchises. But that could be a risk in India, where the

concept is still alien.

He will continue to create content for television, but only for his own channels. That will keep

the intellectual property in-house. Unlike in the West, where the content producer owns the

intellectual property of the content, the ownership in India is with the broadcaster. This limits

the content producer's scope for monetising his content on other platforms.

Screwvala also wants to move to season-based programming, a popular concept in mature

markets where shows appear for a just a season of 13 to 24 episodes, once a week for half


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an hour to an hour.

In India, of course, they appear five days a week, all year, every year, until nobody watches

them anymore. The season approach helps in focusing resources better, since the money

does not have to be stretched to cover 250 episodes a year, nor does the script.

"The psychology of making daily soap operas is that when you get something right the last

thing you want to do is take it off the air. You tend to carry on. The exhaustion level sets inand in any case you are killing it. If you give it a break of three months and start again, you

bring freshness into the content and that could work better," says Screwvala. He cites the

example of the popular US sitcom Friends, which ran for 10 seasons for a total of just 180

episodes.

On the other hand, Star Plus's most popular show, Kyunki Saas Bhi Kabhi Bahu Thi, ran

non-stop for eight years and aired more than 1,800 episodes. The ratings of the show, after

peaking at 30 GRPs, dipped to a low of four. The broadcaster had to pull it off abruptly,

without waiting for a logical ending.

{blurb}The last year-and-half Screwvala has been busy integrating the Disney and UTV

businesses, and thinking brands and franchises. "The Walt Disney Company is about

creating intellectual properties and building franchises that span movies, television, games,

theme parks, consumer products and more." Mickey Mouse, for instance, is a $5-billion

franchise whose reach need not be described here.

Disney, a $42-billion enterprise, is known the world over as a family entertainment brand and

Screwvala believes that will clinch the issue in India, too. "We see no one really occupyingthe 'family brand' space here. And I think Disney is best equipped to move into it. You will see

the family positioning across all our verticals." Theme parks, though, are out of bounds for

now.

"For a Disneyland to be created there has to be a certain minimum scale. The basic

infrastructure is important, not just inside the theme park but in all the avenues leading to it

from airports to railways lines to roads and public and private transport. So there are no

plans for this at present."

The next few years would be spent building scale. "That's absolutely the key and what

Disney has done is augmented the creative capital they had here. Actually, UTV is also a

creative organisation - we create in television, in digital and we create in movies. If you look at

that, you have the whole nucleus together."

A Matter of Scale

Scale, incidentally, was the reason Screwvala chose to sell. He admits that it would have

been difficult to build UTV into a bigger company. "Scale has always intrigued me. From the


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UTV perspective also we were looking at scale. From the Walt Disney perspective they had

an office here and were looking at scale. The question of making deep investments in all the

verticals was the exciting part to me. Scale and the diversified business is the sharp level,

where I think for the next few years I could contribute."

For Disney, Screwvala believes it was UTV's content creation capability, in contrast with

others companies' platform capability, that held the biggest appeal. The US giant had been

trying to enter film production in India and even got into a partnership with Yashraj Films toproduce a series of animated films. Their firstborn, animated film Roadside Romeo, sank

without a trace. It turned out to be the last of the partnership.

Disney UTV is looking at Disney-branded Hindi movies. How would those be? "Uplifting,

heart-warming, family entertainment loaded with values. That would be the broad

framework," says Roy Kapur, adding that a number of them are already in the works.

The operative word here is "family". Even when Disney makes an animation film, it is not

merely for children. "Disney doesn't make animation for kids, it makes them for the family.You are going to see Finding Nemo not because you are just accompanying your daughter or

your grandchild, you are going because you want to see it and you are taking them along,"

says Screwvala.

And yet animation is nowhere on the agenda right now. It wouldn't be, what with Arjun, an

animation feature made at a cost of Rs 12 crore that released in May 2012, bombing at the

box office. "India doesn't have an animation market because everyone thinks that animation

is for a juvenile audience. The bulk of the cinemagoers in India is between 15 and 24 years.

The company had attempted to attract them through its animation filmArjun last year, but itfailed. A part of Arjun's experimentation was to start to age-up animation. It's going to be a

slow process in India as nobody grew up on animation.

In the West people have grown up watching animation," says Screwvala.

Call of the Entrepreneur

So much for Disney. What about the entrepreneur who is remembered by his peers as

"hands-on", "restless" and "aggressive"? Is that a thing of the past?

"I am surprised Ronnie has stuck to Disney, a rather laidback company. He is used to

working 90 hours a week and is always hungry to do new things," says Ashoka Holla,

Director at film content marketing firm Berserk Media, who owes it to Screwvala for sowing

the seeds of entrepreneurship in him.

Screwvala has not cut all links with the world of start-ups. He has used his money from the

Disney deal to set up Unilazer Ventures, which recently picked up 45 per cent equity in agri-

based company INI Farms for Rs 20 crore. Unilazer also supports Swades Foundation, an


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NGO that aims to provide a million people in rural Maharashtra with drinking water, livelihood,

health care and education in five years.

Screwvala, however, says Disney UTV is where his focus is. "I do have an inclination for

philanthropy, but is that going to be a full-time occupation? No," he says. But those who know

him - or think they know him - refuse to believe it. "Maybe he is bound by a contract and

would soon be on his way out," says the former COO of a leading media network. He sounds

almost wistful.{blurb}

{blurb}

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