In this constantly changing and fast paced industry, sometimes it’s important to stop and see how all the pieces fit together. Consider: in the space of a few days, Netflix (NSDQ: NFLX) canceled plans to completely separate streaming from DVD and signed an eye-catching deal with the CW; cloud-based VOD scheme UltraViolet went live; Universal announced a premium VOD, then canceled when exhibitors threatened a boycott; and Disney (NYSE: DIS) and News Corp. (NSDQ: NWS) took Hulu off the block. Then there’s the upcoming launch of the Kindle Fire, which will unlock Amazon’s media assets for mobile use, and ... you get the picture.

We’ve added some new speakers to help us put the puzzle together, including two successful entertainment execs applying their considerable skills to new endeavors:

»   Dawn Ostroff joined publisher Condé Nast just last month as president of Condé Nast Entertainment, a new endeavor for the development and distribution of video and film initiatives as well as creating original web content. Ostroff launched the CW as president of entertainment, greenlighting Gossip Girl, The Vampire Diaries and the other programs that netted that deal with Netflix—worth up to $1 billion for the Time (NYSE: TWX) Warner-CBS (NYSE: CBS) joint venture.

»   David Maisel, who launched Marvel Studios and was chairman until Marvel Entertainment was sold to Disney, is now special adviser to game developer Rovio. Maisel is helping the company build its entertainment strategy, including bringing game franchise Angry Birds to the big screen. He’ll serve as executive producer for any Angry Birds films; his executive producer credits already include Iron Man, Iron Man 2, Thor and Captain America: The First Avenger.

Other new speakers include: Christy Tanner, General Manager and Executive Vice President, TV Guide Digital; Lisa Donovan, Co-Founder, Maker Studios; Dana Settle, Founding Partner, Greycroft LLC; Lisa Donovan, Co-Founder, Maker Studios; and digital entertainment vet Courtney Holt. Stay tuned—more announcements to come. Until then, here’s our speaker list so far.

Be part of the conversation on what’s happening now and what’s coming next-and how you can stay ahead. Register now.

The hashtag for the event is #pcE11.

And he’s plenty up to the challenge. Andy comes to us from The Hollywood Reporter, where as editor of digital media, he both oversaw editorial operations for the publication’s website and reported extensively on the entertainment industry. He has broken news on companies such as Yahoo, Hulu and TV.com, and has done deeper dives on everyone from HBO and YouTube to Ashton Kutcher. Among his other accomplishments at THR: he launched Digital Power, an annual event and special issue that has been highlighting the 50 best executives in digital entertainment since 2008.

Andy has showcased his talents at other media properties as well. For the past six years, he has served as a frequent commentator on media issues for National Public Radio. He was also co-host of the TV Guide Network primetime series “Square Off” in 2006-07. Andy has also written for The New York Times (NYSE: NYT), Boston Globe and BusinessWeek.

You can reach him at aw@paidcontent.org. Andy also will be moderating at our Nov. 8 event in West Hollywood, The Battle for the Digital Home. You can find out more about the agenda here and register here.

Public broadcaster Prasar Bharati has recommended SIS to the ministry of information and broadcasting after narrowing down contenders from an original list of four companies, the report says.

While Prasar Bharati will be the official broadcaster of the mega event, the selected company will be responsible for producing the telecast in high-definition format.

The block deal ws executed at Rs30 per share, according to TV18. The stock had touched a 52-week low of Rs8.75 on 13 March.

While the identity of the seller would not be officially known till the next trading day (Tuesday), TV18, citing unnamed sources, reports that Temasek has sold its 13.49 stake in the company.

Temasek, Singapore government’s sovereign wealth fund, held a 13.49% stake in the firm as on 30 June. The stake was held through two subsidiaries—Aranda Investments (Mauritius) Pte. Ltd and Dunearn Investments (Mauritius) Pte. Ltd—and part of this (10%) was acquired in 2005 at Rs62.50 per share, according to report then in The Hindu Business Line. 

Temasek’s other investment in India’s media and entertainment space was Peter Mukerjea-promoted INX Media, which has since sold the news business at an undisclosed price and has significantly downsized its entertainment channel 9X.

A Temasek spokesperson declined comment.

For the quarter ended 30 June, Fame India, which operates multiplexes and has interests in film distribution, posted a net loss of Rs9.53 crore, up from a loss of Rs3.66 crore during the year ago period. For the fiscal ended 31 March, the company posted a net profit of Rs1.87 crore.

Star One would be the second GEC after UTV’s Bindass on the Mimobi platform, which hosts a lot of news channels. Star News on the go would be nice.

When 3G finally gets off the ground in India, these early moves will likely pay off.

Blue music release:

In what is being touted as a first for Bollywood, music label T-Series will simultaneously release the music of Bollywood film Blue on the physical format as well as on the Internet and mobile devices. Hungama Digital Media is handling the digital distribution of music, while T-Series is also making the music available on USB drives and micro chips, which will be priced at Rs490.

The film has a music video starring actor Akshay Kumar and pop star Kylie Minogue.

“Releasing the music of the film on the digital platform simultaneously has several positive implications for consumers, for record labels and for the Indian music industry ... It will also ensure content is protected, thereby enabling the industry to mitigate losses incurred by the entertainment industry due to piracy,” Hungama MD Neeraj Roy said in a statement.

Eros seems to have effected a big change of heart in Parigi in two weeks. “I turned 60 years earlier this month and I thought I should devote more time and energy to pursue my long cherished personal interests and passions,” Parigi was quoted as saying in a The Times Of India story dated 3 August.

Parigi, who spent nine years at Bennett, Coleman & Co. Ltd, which publishes The Times of India, was the principal architect behind the firm’s acquisition of London’s Virgin Radio. Eros International Plc. is an AIM, London-listed entertainment firm with primary interests in film production and distribution. The company’s recent films include Partner and Namastey London. Parigi will also join the board of Eros International Media Pvt. Ltd, the company’s Indian arm.

“Having spent several years in the telecommunication and media domain, I’m keen to explore the challenges of developing global delivery platforms that meet the ever changing needs of the audiences,” Parigi said in a statement. 

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The end of the standoff will mean that the first week will see a revenue sharing of 50:50 between producers and multiplexes for all films. Producers can also now decide the release plan of their films. Earlier, if a multiplex was to show a film, the producer had to release the film in all the centres of a multiplex chain. In subsequent weeks, revenue will be shared as per the following ratio: 42:58, 35:65 and 30:70 (producers: multiplexes), said Mukesh Bhatt, chairman of United Film Producers and Distributors Association. He said the losses due to the two-month-long impasse was estimated to be Rs300 crore.

“We are delighted that we have been able to reach a resolution to the issue. We have decided to now stand together and fight the menace of piracy, which is resulting is a loss of crores of rupees to the industry and the government,” Bhatt told contentSutra. Bhatt’s Jashn will release on 10 July, he said.

Amit Khanna, chairman, Reliance Big Entertainment, clarified some related clauses underpinning the broad agreement. “If a film grosses more than 17.5% in the first week, there is a 2.5% upside in the sharing formulae in favour of the producers for the first three weeks. Similarly, if a film grosses less than Rs10 crore in the first week, there will be a 2.5% upside in favour of the multiplexes in the first three weeks.” Is essence, when a film performs well, producers are rewarded and when it doesn’t perform very well, exhibitors are compensated. 

He also clarified that while producers are free to decide on the number of screens and which multiplexes they want to release in, multiplexes will get to decide the number of shows and which shows a film is allocated. Also, the Multiplex Association will have a say in 5% of the total number of screens a film is released in. For instance, if a film is released in 100 screens, the multiplex association can allocate five screens to any multiplex as per their discretion. This is to avoid the victimization of any multiplex by the producers, Khanna said. This is not applicable for films releasing in more than 500 screens, because all multiplexes would have been covered in such cases.

The two sides are expected to make an announcement on Monday with further details.

Photo Credit: Flickr/RajMan

The board has also approved the merger of its subsidiary Fun Asia USA with another US-based company in a similar line of business, the company said in a note to the BSE, without providing further details. The board also approved the expansion plans of sister company Pyramid Saimira Production International Ltd and consented to a plan to bring in fresh debt and equity into that company.

Here’s the full release.

Brokerage Angel Broking downgraded the stock to ‘Reduce’ with a target price of Rs35. On the Bombay Stock Exchange, the Balaji scrip dropped 5.36% to close at Rs41.5. 

Excerpts from the Angel Broking’s latest report on the stock:

Commissioned hours of programming have reduced by 51% y-o-y during the quarter under review to 42.3 hours, owing to the decommissioning of three shows by Star Plus and one by Zee TV. “Moreover, Other Expenditure increased by a whopping 200% yoy to Rs23cr (Rs7.7cr) largely on account of significant jump in provision for doubtful debts (dues from INX Media) to Rs15.7cr, legal charges against Star and partly due to diminution in long term investments further adding to the woes.”

Film division: Balaji Motion Pictures Ltd, a wholly owned subsidiary of the company, posted a net loss of Rs23.3 crore on revenues of Rs42.6 crore. “Profitability of this division was partially hit due to Rs8.85cr write-off which the company took on account of advances made for Movie Projects which it doesn’t expect to pursue further (due to financial non-viability of the projects).”

Organizational Restructuring: Under Group CEO Puneet Kinra, the company has appointed three new divisional CEOs. Nachiket Pantvaidya for television, Uday Sodhi for new media and Ajit Thakur for movies. Pantvaidya was general manager, south asia, BBC Worldwide, before joining Balaji, while Sodhi was senior vice-president, interactive services, at Rediff.com (NSDQ: REDF) and Thakur was COO at UTV Television. 

Bottomline:

“We believe BTL is going through extremely tough times owing to its ongoing tussle with Star, lack of demand for its content and falling realisations ... Going ahead, we expect BTL’s financial performance to remain under pressure owing to low visibility of its programming slate (3 out of 5 commissioned shows on-air were launched in 4QFY2009) and dipping realisations,” analyst Anand Shah wrote. “Given significantly poor 4QFY2009 results, limited show pipeline, sharp losses in Movie business and lack of demand for its content, we downgrade the stock from Accumulate to Reduce with a Target Price of Rs35 (Rs52) based on cash on books of Rs216cr (likely to act as downside cushion). Moreover, exodus of Top level Management, ongoing tussle with Star and lack of clarity over dues from INX Media is likely to weigh heavily on the stock.”

Balaji management could not immediately be reached for comment.

Flash Back:

Balaji seems to have been hit hard by the end of a long and beneficial relationship with Star India Pvt Ltd, India’s biggest private broadcaster. For years, Balaji soaps on Star, such as Kyunki Saas Bhi Kabhi Bahu Thi and Kahaani Ghar Ghar Ki topped ratings and defined what worked in terms of television content. Balaji produced shows for Star under an exclusivity agreement—Star would pay a premium for Balaji shows, but the content shop could not produce shows for rival channels that would run on the same time slot as Star. While the premium was never disclosed, the extent of the drop in average realisations post the decommissioning of Star shows gives some idea of the higher rates Balaji attracted. The relationship grew stronger when Star picked up a 25% stake in Balaji and the two companies formed a joint venture to launch entertainment channels in regional languages. Curiously, there was a sudden deterioration of their relationship in early 2008 and in August that year, the two companies agreed to part ways, ending with it the exclusivity agreement and the premium Star paid. Balaji agreed to buy back the stake owned by Star and the regional language GEC was wound up. Star later dropped three Balaji shows from its programming line up.

The breakdown in relationship coincided with the entry of a number of new, well-funded entertainment channels, such as 9X and NDTV Imagine, both headed by former Star India CEOs (Peter Mukerjea and Sameer Nair) who enjoyed good working relationship with Balaji and wanted its shows for their new channels. 9X has since seen tough times and Balaji has now had to make higher provisions for “doubtful debts” from that channel’s broadcaster INX Media. 

There is however, good news for filmgoers who have found little reason to go to the cinemas since last month. Producers will now go ahead and release their films in single-screen cinemas. “We have decided to go ahead and release our films in good old single-screen cinemas. We have conducted a detailed study over this and we will finalize our strategy in a week’s time,” Bhatt told contentSutra. When asked if this means viewers will get to watch new releases in three weeks’ time, Bhatt said: “We hope so”.

The impasse was created when producers started demanding a fixed revenue share deal from multiplexes in place of a varying system of splitting box office returns. Currently, the producer gets 45-48% of revenues in the first week of a film’s release, and their share goes down progressively over the subsequent weeks. By the fourth week, the producer gets only 30% of revenues, according to this Business Standard story. Producers have been demanding a flat 50% share in place of the current system and suspended all releases and marketing activities till this demand was met on 4 April. Since then, occupancies in multiplexes have been down to 10%.

However, multiplexes are estimated to account for some 60-70% of total box office collections. When asked how producers can cope with the drop in collections, Bhatt said: “That’s a blunder we made. We created this system. Now we are working on alternative strategies to distribute our films.”

Unlike Multiplexes, single-creen cinemas work on a rental basis. Producers pay a fixed rent to the cinema owner to exhibit their films. “With single screen cinemas, we can effectively get a 75-80% share of collections,” Bhatt explained. In absolute terms, however, the collections will be lower, as multiplexes, which provide a better viewing experience and ambience, are able to get a much higher ticket rate from viewers than single screen cinemas. 

Consumer durables major Videocon will launch its DTH service in May, reports PTI. A soft launch of the service was done on Tuesday in Macau, in the presence of some 2,500 dealers. “The full commercial roll-out will start from May 1. In the first year, we are looking at 15 lakh subscribers and add similar number every year. The target is to have one crore subscribers in six years,’’ Videocon Group chairman Venugopal Dhoot told PTI.

Some 250 multiplexes in the country may down shutters if the impasse with Bollywood producers over revenue share continues, BS reports. Multiplexes account for some 80% of Bollywood’s box-office revenues, the story says.

A group of shareholders, led by the Asia-focused hedge fund Altima India Master Fund, is seeking to remove Raghav Bahl and Alok Verma from the board and replace them with Aashish Vyas and Atul Sethia. The shareholders are unhappy with the financial performance of the company and the dwindling share price. They point out that there’s a “disconnect” between the box-office success of the films and the company’s financial performance. The dissident group, which includes Kelusa Master Fund and other shareholders apart from AIMF, together control 31.75% stake in the company, according to a statement issued by the group. Bahl holds 21.6%.

The dispute broke out two weeks ago and was reported by Business Standard. The rebelling group, which calls itself The IFC Requisition Group, has stressed two data points in its communications to media. First is the fact that IFC shares were trading at a 75% discount (on its listing price of 100 pence) on Dec. 22, when the EGM was called. Second is that in the first 18 months of operation, the company produced a net profit of £3.4 million (of which £2.0 million was earned in interest) on initial equity capital of £52.8 million. “On the basis of this, it is not possible for shareholders to draw any firm conclusions about the reasons for the low returns being achieved,” the group said in a statement.

Over the same period that dissident shareholders are referring to (June 18, 2007, to Dec. 22, 2008) the broader FTSE AIM 100 Index fell nearly 70% (vs the 75% drop in IFC’s share price). The shareholder group suggests that the financial results are at least partly a function of bad fiscal management—“rather than just current market conditions.” IFC has declined to comment about the dispute.

IFC is primarily in the business of distributing films. Typically it acquires the distribution rights of a film from its producers, paying a high acquisition price upfront, and monetizes the investment over the years through the resale of music rights, territorial theatrical rights, satellite rights, home video rights, DTH (direct to home) and pay-per-view rights over the years. The distributor has to bear all marketing and distribution expenses as well. The distributor makes only a small percentage—typically 25% to 30% of total box office collections (distributors make less and less money with every passing week that film runs in a cinema, due to the way deals with multiplexes are structured). According to Komal Nahata, author and analyst of the film trade, only about 50% to 60% of a distributor’s revenues come from box-office collections. The rest comes from the monetization of other rights.

IFC has had a string of hit movies including Jab We Met, Welcome, Singh is Kinng, Golmaal Returns and Ghajini. Dil Kabbadi and Kidnap were its other releases. Since the firm doesn’t disclose how much it paid to acquire these films and how much it spent marketing them, it’s hard to say whether IFC’s cost structure is too high. However, the films it owns (IFC typically buys rights for 10 to 15 years) clearly have several years of monetization left in them.

We’ll be watching to see what transpires at the Feb. 5 EGM.

What prompted Canaan to invest in Chakpak is its market potential. Alok Mittal, Managing Director, Canaan Partners, India explains that out of a base of 40 million online users in India, 18 million are already accessing some or the other entertainment destination. This put together with the demand for Indian content outside India totals to 25 -30 million users. Mittal says “it’s a large category. Since chakpak.com gets 5 million visitors every month, they have shown very strong traction over the last 12 months in building a significant presence.”

The site claims to get 5 million unique visitors a month which is about 20% of the overall consumption of online entertainment in India and by NRIs.

According to The PricewaterhouseCoopers and FICCI Frames Report, the Indian online media and entertainment market is expected to grow to $36 billion by 2012.

Though chakpak’s services largely revolve around films, they also plan to tap other revenue streams such as movie marketing, movie merchandising, and pay per download movie views. Chakpak will compete with the likes of Bollywood Hungama (formerly IndiaFM), Buzz18, ZoomTV, E24Bollywood and MyPopKorn.

This story has been provided by our content partner VCCircle.

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PS: Hello again! Cerius is back on the wire. Leave a msg on GTalk for updates, tips and general faff on areyoucerius (at) gmail (dot) com

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—Reliance Capital, the financial services arm of Anil Dhirubhai Ambani Group (ADAG), has launched its private equity advisory arm Reliance Equity Advisors Ltd (REAL), which will advise its soon to be set up $1-billion private equity fund. ET reports the firm has received regulatory approval for an initial corpus of $1 billion, of which ADAG has contributed around $200 million and the rest will be raised from two linked funds, based out of India and Mauritius respectively.

REAL has put in place a 15 people advisory team members of which have been hired from Actis LLP, ICICI Ventures and Sequioa Capital. As per Bloomberg, the team is being led by ADAG CFO Ramesh Venkat, who will be the Director of REAL, besides his duties as CFO of the group. REAL will invest in emerging sectors such as services, logistics, realty, pharma, media firms and Indian companies investing overseas with investment size ranging from $75 million to $100 million. The board of REAL will comprise of Venkat, Amitabh Jhunjhunwala, vice chairman of Reliance Capital, and chartered accountant Rajendra Chitale. REAL will be a wholly-owned subsidiary of Reliance Capital and will be an advisory private equity player which will offer a range of services. The report added that the firm has already started talking to investors and expects to close the fund in the next few months.

ADAG also has a private investment advisory business called Reliance Technology Ventures Pvt Ltd, headed by ex-IBM executive Harshal Shah. It has invested in Sequans Communications, a France and US based company that provides WiMax chips. Last year, along with Sequoia Capital, RTVL invested in US-based Stoke Inc. It also invested $10 million in E-Band Communications Corporation. More here.

—Big TV, Reliance ADAG’s to-be launched DTH service has bagged the official DTH partnership rights for the IPL for Rs 137 crore ($31.16 million) for four years. According to BS, the only other contender was Airtel’s rival DTH service, Digital TV, which had put in a bid of $30.28 million (Rs 127 crore) for the same term. This doesn’t mean Big will hold rights for DTH, the telecast rights are with the World Sport Group, for which they had paid $1 Billion, for 10 years. Big TV will be the official DTH sponsor, just like Pepsi is the official beverage and Kingfisher, the official airline.

The books will presumably be searchable through Google’s controversial Book Search project. It already indexes English texts on popular Bengali writers such as Tagore. This could possibly be the first of a much larger effort to digitize and make searchable large troves of India’s multi-lingual literature, most of which must be long out-of-print. Nothing special about the movies, they will be hosted on YouTube. I guess there will be better edits and deeper content if the proposal takes shape, otherwise, there is already plenty of Bengali content out there.

As an interesting aside, Google has offered to maintain mail accounts of all ministers and top state government officials. I can only imagine the kind of ads GMail would throw up.

This continues the crazy nine lives of the doomed movie service Moviebeam: For a background, MovieBeam is a Video on Demand service launched by Disney in 2005 that broadcasted content via a proprietary set-top box and Dotcast technology. Besides integration options with Valuable’s digital cinema unit, UFO Moviez, Valuable also has it’s own proprietary satellite based set-top box solution, titled BOX Networks. The solution shares support for delivery of High Definition, VOD, Pay Per View and Video Recording with the MovieBeam solution. A previous acquisition by Movie Gallery (MG) was reportedly for $10 million, and then MG went into bankruptcy and sold it to London-based Dar Capital. Valuable has bought it from Dar.

Considering MovieBeam had officially announced a cease of operations over a year ago, this will add a last mile play to their existing satellite based digital cinema business as well as access to technology licensed by MovieBeam (Dotcast) for the set-top box solution. Additionally, this also gives UFO Moviez the ability to simultaneously release movies for both the theatrical as well as a VOD platform.

The release quotes Gaikawad stating they have ear-marked an investment of $100 million over the next two years for the re-launch of the service (slated to launch at the end of 2008) in North America, UK and other markets.

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