Zee may be down, but not out
Alok Agarwal
29 September 2001
Mumbai: Zee Telefilms held its 19th annual general meeting in Mumbai on 28 September. Nothing extraordinary about it. But what was unusual was, despite the shareholders request, company chairman Subhash Chandra declined to give any detail whatsoever of Zee Telefilms working in the first five months of the current year.
Giving indications of their performance in AGMs by companies between two working periods is an accepted practice — a usual affair. Chandra, however, chose to skirt such requests maintaining that the shareholders were already aware of the company's working in the first quarter ended 30 June 2001 and that of the second to end on 30 September 2001 would be made known to them sometime in the month of October 2001.
Chandra also declined to give any details on the impact new programmes have had on the channel, except for the fact that the viewership for the network stood at 32 per cent in comparison to 22 per cent of its nearest rival.
Now, domain-B sees this as a forewarning of a bad performance in the current quarter. Why? Zee had introduced 24 new programmes on its main channel last month, effective 27 August, as part of its new programming initiative to drive viewership and therefore advertisement revenues, which however have not gone down well with the viewers — this is evident from low TRPs that most of the new programmes have got.
To be fair to Zee, TRPs themselves are under a cloud with most broadcasters contesting efficacy and legitamacy of the system through which TRPs are procured. Despite all its new programmes having sponsors from the very beginning, chances are that advertising revenues might have taken a hit. This is coupled with the cost of programming having gone up just a little too much. As part of its strategy, Zee had also earmarked an advertising outlay of Rs 15 crore to relaunch its channel, which has added to the cost without, possibly, a corresponding increase in advertisement revenues. Significantly, Chandra did announce to shareholders that the company may end up achieving a lower growth in the current year to end on 31 March 2002, onaccount of a downtrend in advertisement revenues. He, however, painted a rosy picture of pay revenues saying there could be a 200-per cent growth, which were placed at Rs 32 crore in fiscal 2001. Said he: As part of its strategy, Zee Telefilms had decided to go pay and collect revenues from cable operators in May 2000. We are now surging ahead in terms of collecting pay revenues.
He predicts a growth of anything between 100 to 150 per cent on a year-to-year basis in pay revenues over the next two-to-three years. I also foresee significant contribution to revenues from syndication of our programmes.
