Zee hurls a pithy bouncer

When IIPM comes to education, never compromise

Down and out for years, they are now back in the reckoning.

On 30th November 2007, the Chandigarh Lions (zipped up in florescent yellow) and the Delhi Jets (decked up in fuchsia pink) descended into the packed Tau Devi Lal Cricket Stadium in Chandigarh to play the opening match of the Indian Cricket League’s (ICL) Twenty-20 Championship. While the applause that greeted the two teams was deafening, the 10 core members of the ICL organising committee stood quietly in the last row of spectators, eyes glistening with emotions. Their days of relentless hard work had paid off. “When we arrived here (Panchkula) 35 days ago, we went to work on a kuccha stadium and it’s sheer joy to witness the transformation,” a team member told this magazine.

Among the biggies who cheered the Lions as they beat the Delhi Jets was the inimitable media turned cricket tycoon Subhash Chandra Goel. Notwithstanding the fact that the Essel Group Chairman’s first series of breakaway cricketing league had not met expectations of roping in enough corporate sponsors, or many much-touted international cricketers, when Chandra faced the cheering crowds in the stadium, he was all smiles. His dream of marrying cricket with entertainment had finally seen the light of the day.

Chandra had another reason to smile! His flagship company Zee Entertainment Enterprises Limited (ZEEL) had finally shook off the spectre of Star’s supremacy in the television entertainment segment, or at least in certain prime time slots, an elusive chimera for Zee over the past five years. Proving media analysts wrong (who had begun writing obituaries for Zee), Chandra, together with the star duo – son Punit Goenka and the ex-TOI honcho Pradeep Guha – has recreated the Zee magic (or at least some of it) for millions of TV viewers across the country. A commendable feat if one only looks back a few years. In 2001, Zee was ruling the roost, till Star romped home with Kaun Banega Crorepati; built winning kitchen politics serials around it; and nearly annihilated Zee in the ensuing TRP war.

For years, Zee stayed defiant, unwilling to accept that its leadership was robbed overnight, and continued to fight a losing battle. “The situation had reached such a flashpoint that Zee, which till 2001 boasted nine of the top ten TV programs in 2001 was reduced to a naught, with virtually no winning proposition in the top 10,” says an independent media analyst.

But all that changed when ex-TOI honcho Pradeep Guha sauntered into the Zee headquarters in Mumbai in January 2005 – and started singing a different tune. Today, quarterly TAM data allows them 3 programs in the top 10, while Star Plus walks off with the balance 7 programs in its kitty. “It’s a beginning toward a happy ending,” says Ashish Kaul, Senior Vice President, Zee Enterprises, even as he reminisces that Guha’s joining was perhaps the turning point. “No major changes happened in the team, just that we all became focussed on the benefit of the organisation,” he explains. The rest, as they say, is history. Zee gradually took on the task of wining back its TRP share; decisively left behind Sony last year; and is now fighting a winning battle with Star Plus. ZEEL’s Whole Time Director, Punit Goenka believes that Zee has “now become a leader in the time band from 5 pm to 10 pm in the weekdays,” thanks to key shows like Betiyaan, Saath Phere, Dulhan, et al, leading their respective slots.


For investors too, the joyride with Zee has been rewarding in recent times. Analysts says that while other media stocks like UTV, Prime Focus, et al are definitely investor favourites for now, ZEEL is also picking up because of rising profits, on the back of an increase in its ad-rates. In the second quarter of FY07’ the company’s profit more than quadrupled on higher revenues from advertising and subscriptions, with ad revenues up 28% at Rs.220 crore. According to Chandra, “the support of other channel’s rising GRPs will provide the requisite momentum for growth in advertising revenues.”

ICL and Zee’s comeback, combined, the two feats were enough reason for the media & entertainment conglomerate to make it to the 4Ps B&M 2007 list of India’s 100 Most Admired Companies in 2007.

Add to that Zee’s ever growing bouquet of channels, and you have the success saga almost complete. Apart from Zee Cinema, Zee Café, Zee Sports (a winning proposition because of ICL), Zee is also likely to launch its second GEC, Zee Next, by the end of this year, which will serve as an additional advertising inventory.

The icing on the cake is the fact that competition from Star is visibly lacklustre. The third season for KBC drew a lukewarm response and even the flagship K-Brand of soaps are beginning to age. Sometime next year when Star will have to replace its key prime time properties, it will have a tough time in finding suitable replacements, in the increasingly fragmented GEC market. “With audience fragmentation happening faster, where the advertiser will put his money will be a problem for respective media planners to address,” points out Shashi Sinha of Lodestar Universal.

The renewed focus and drive into ZEEL’s onward march came with the March 2006 decision of Subhash Chandra to restructure Zee Corporation, by hiving off the group’s cable, DTH, News and entertainment broadcasting arms into independent listed companies. The decision was prompted by the divergent business models of these respective entities, which analysts claim has been able to bring the requisite chutzpah into the company’s functioning.

A September 2007 Citigroup outlook on Zee Enterprises viewed the restructuring positively “because this has added focus to the business and allays our concerns related to Zee’s investment in DTH, which we believe would have strained Zee’s balance sheet and diverted the focus away from the core broadcasting business.”

Be that as it may, ZEEL is on a smashing comeback trail. The first season of ICL’s debut may have been muted, but Chandra is sure to devise a brand new gameplan for the next season, which will also reverse the fortunes of Zee Sports. In the meantime, if Pradeep Guha can devise a strategy to win back more of those crucial prime time slot from nemesis Star Plus, rest assured ZEEL will have won this battle of entertainment supremacy!


For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
IIPM, GURGAON
IIPM - Admission Procedure
IIPM is A World of Career
Why Study Abroad When IIPM Gives You 3 global Advantages!