Zee Entertainment Enterprises, the largest Indian broadcasting company, said it plans to raise the number of exclusive movies on its entertainment app ZEE5 to 3,000 as it races to become the No.1 provider of digital content in India.
The 3,000 exclusive movies would make the platform one of the biggest, if not the biggest, repository of exclusive movie content in India. In all, said CEO Punit Goenka, the platform will have a total of 4,100 movies in total.
The company has on a movie-buying spree in the year ended March 2018, ahead of the launch of ZEE5 app. It spent a whopping Rs 900 cr on acquiring movie rights last financial year, and is expected to spend another Rs 400 cr this year.
The company exhibits most of these movies on its TV channels as well as on the app.
“You would not see all 3,000 sitting on the platform today but they are being brought on as we speak. It’s being populated as we speak. So over the next three months, you will start to see all of the 3,000 titles available on ZEE5,” Goenka.
The acquired titles span a variety of languages, including English, Hindi and other regional Indian languages.
Part of the reason for ‘splurging’ on buying movie rights is to retain the young audience, the CEO said, adding that both the satellite and digital rights (for the app) are being purchased.
“When we sold our sports business, there was a question to us that how you get that audience base which is unique to sports, which is youth, male, etc,” he said.
“And the only genre that we believe can capture that audience significantly well is the movie genre. We believe that we want to be the largest player in the film categories, across languages, across platforms and that’s what we are working towards.”
Zee Entertainment also said it is investing heavily into original content for the app.
At present, it said, it has 29 original web series available only on ZEE5, and plans to launch 60 new original series on its ZEE5 app in the six months from October to March.
In comparison, its biggest competitor Star India relies heavily on repurposed TV content to drive consumption on its Hotstar app.
Goenka said all the investment will make ZEE5 the “biggest producer of digital content in India”.
He said the target is to have 500 to 600 hours of original content within the first 18 months.
The company, he said, is still learning and tweaking its model.
“We are seeing that we get far more traction for 1-hour episodes than a 0.5 hour episode. Some storylines, or some genres of content, we will be scrapping altogether,” he said.
“Unlike television, where it’s a factory and we have to fill 260 episodes a year, here, we do not have any of those benchmarks or yardsticks,” he added.
The costs of producing the series is higher, Goenka added.
“The content cost will not be similar to television, they will be higher. If you leave out the things like Karenjit Kaur, etc., I think you can safely assume a 3x kind of a number in your content cost compared to TV,” he said.
The company said it was not worried about making such heavy investments into content. In fact, it said, they will help it remain competitive in the new, app-focused era, when it faces competition from new entrants like Netflix and Amazon.
“There are lot of questions from investors that what happens if there is more
intense competition in the digital space,” pointed out CFO Bijal Shah.
“So, what we are saying is that we have more room to invest as our broadcast business is doing very well.”
The company expects the app to contribute a minimum of 30% of its revenue in the next five years.