Current figures however reflect the travails of an industry trying to diversify business models overly dependent on advertising, rather than reflect the sector’s true potential, thinks Ronnie Screwvala, MD of The Walt Disney Company in India.

Given the country’s young population and a strong consumption story powering the economy, the growth rate should be much higher, he argued, speaking at this year's Asia Media Summit, staged by Media Partners Asia in Singapore.

“I would love to say we are a cup half full and half empty, but I think we are actually 30% full and 70% empty,” remarked Screwvala, one of Indian TV’s founding fathers.

“There’s a lot to be seen and a lot of strong rhetoric, which is definitely true, but I think the 70% presents a unique opportunity.”

Transformation to come

India offers plenty of scope for transformational growth, from the promise of a healthier TV landscape, as digital upgrades allow more channels to enter millions of cable homes, to a nascent market for live events, providing new entertainment experiences for consumers and new revenue streams for media companies.

“The core young Indian doesn’t know how to spend on entertainment, because they haven’t had avenues to spend on,” Screwvala said.

“Controversial as they may have been otherwise, our Commonwealth Games have aligned us to create large infrastructures. We believe experiential entertainment is imminent as a good segment of the entire M&E pie.”

There is no reason why other media businesses shouldn’t flourish on the back of India’s growth story, from cinema to radio, Screwvala continued.

Two hurdles

Nonetheless, two major factors in the near-to-medium term will underscore the long-term health of India’s M&E sector as a whole.

Cable operators may struggle with the government’s timetable for digitization, with only two of the country’s four largest metros charged with being fully digitized by November likely to hit the deadline, but what’s more important is the willingness of consumers to pay extra to support a more diverse ecosystem.

While DTH platforms, which have grown exponentially in recent years, have been able to secure between $5-10 monthly ARPU (average revenue per user), slightly higher than analog cable, they should have charged much more, between $20-30, Screwvala argued.

“Digitization will come in. If they can’t get to $10-15, we’re still in a challenging medium. The next two to three years will be challenging, but still better than the last 20 years.”

Broadband bet

The second catalyst of change, described by Screwvala as the joker in the pack, is broadband. While both speeds and penetration are low today, billions of dollars are being invested in mobile broadband networks, potentially transforming millions of single TV homes by giving them another outlet for information and entertainment.

Though it’s still unclear when this might happen, Screwvala feels that in some ways broadband represents a safer bet on the future than cable digitization.

“Broadband for India is not just content,” he explained. “The people building it are looking at health, education, entertainment and security. If you look at those four, you’re suddenly looking at the broadband pie in a very different way.

"That’s why it will have a lot more staying power. That is definitely going to be a game-changer.”

This year's Asia Media Summit, organized and staged by Media Partners Asia (MPA), was held at the Capella Resort in Singapore. For a full report, with overviews of all the sessions on the day, please write to [email protected]