Reflective of Global trends, A new emerging trend in Indian animation is that of animation companies (especially startups) building their business models around the home video space.
The pool at which the Lions drink also provides for the fawn.
The home video space is quite broad in the sense that even while it plays a critical role in the success of the biggest of Hollywood Blockbusters, the same Home Video platform also provides business opportunity for small as well as mid sized animation studios.
Pune based Phoebus Media, Kolkata based Dawsen Infotech, Bangalore based Mediateck and Phanimations, Aurangabad based Jingle Toons, Mumbai based ettaminA and Ice Logics, Hyderabad based Anmipro, Sangli based Oxygen…. the list of studios that have begun with home video is ever expanding.
Factors that are leading to the emergence of this trend
The emergence of this trend has both the push and pull factors.
Need for Investment, Scale and Experience act as strong entry barriers to Broadcast & Theatricals. This pushes original content startups to seek alternate ways of reaching the consumer.
At the same time the growing market demand for home video content and the relatively lower amount of investment needed to produce, pulls them to it.
Says ettaminA’s Amit Anand,”There’s very little scope for a new player to venture direct into creating content for the broadcast space. Firstly there’s a very limited amount of original Indian animated content that is aired. Secondly, you require deep pockets to pre produce the entire series before any broadcaster would even look at it. Thirdly, even if the show gets green lit, there is a huge gap in what the production costs are and what would be paid by the channels. The broadcast space is great to be in, but it is definitely not easy”
“On the other hand you can produce something of great quality with a team of five to eight animators and still target an India wide audience through the Home Video route. The distribution network for most of the active publishers is already established and the focus is on new, innovative but quick to market animated content. With a price point range of between Rs 49 to 300 for animated VCDs, obviously publishers are looking for more and more titles to make their money. This translates into opportunity for animation content creators and here size is no bar” he adds.
“The fun has just begun; we can expect these publishers to widen their distribution network once the cost curve for hardware nose-dives further thus opening up the rural market that forms 63% of the Indian population. The magic then would be in the numbers” he further states.
Challenges: Managing costs and competition even while scaling up
The boon out here is also the bane.
The attractive thing about creating content for home video is the relatively lower investment and smaller scale that studios can enter this space with. This results in a constant influx of new entrants, making it a very competitive environment. As the startups manage to get a foothold in the market and begin scaling up, maintaining low costs and keeping the overheads in check becomes a real challenge.
What initially is a feasible business, over time and growth becomes a tough equation to balance.
Says Phoebus Media’s Rahul Bakshi, “Being in the IP creation space has empowered us to go up the value chain, but to begin with the first gates that opened to us and enabled us to make our mark was Home Video”
“As a small team of 10 to 12 artists we began with creating home video content for publishers such as Times Multimedia. One of the best things we gained was experience of creating content right from script to screen. Today we have more than 45 artists, our show Akbar Birbal is airing on Cartoon Network and our theatrical feature is almost 45% complete” he adds.
“Home Video is a feasible business, but as one scales up, staying profitable and competitive calls for a specific approach to content and partnerships. Also since other doors open up by then, it becomes a matter of strategy whether one wants to focus solely on the home video space or use it as a stepping stone” he further adds.
Kolkata based Dawsen Infotech has made a killing both on broadcast as well as Home Video by creating regional Indian animated content that the audiences enjoy watching.
CEO Bhalotia however puts in a word of caution for start ups considering the home video space. “The waters are definitely inviting but one has to be careful. The markets are ever changing and one has to do one’s home work real well in terms of the content, marketing it as well as keeping the production costs just right”
“As we are publishing & distributing content ourselves, we have observed that volumes especially in the regional home video content take some time to happen. A reason for this is until and unless one is talking of big publishers or big titles, marketing budgets out here are practically negligible and the whole product depends on word of mouth” he adds.
Essential: Handshake with Publisher / Distributor
Given the importance of marketing and reach to consumer, aligning with the right distribution and marketing partners becomes critical to a studio’s business.
While entering into partnerships, startups need to think through and create their strategy on quite a few fronts.
For Instance the case of MGs and Royalties. Each equation between a content creator and publisher has its own pattern and sometimes each title is treated individually. From the content creators point of view a small commissioning amount for content + royalties might mean the necessary fuel to keep fires aburn.
A proper handshake with both parties having mutual trust is absolutely necessary.
Publishers’ Perspective & Market Demand
The home video market has quite a few publishers that are already focused or have begun to focus on animation. Excel Home Videos, Sa Re Ga Ma, Eagle, Shemaroo, Ultra, Shethia Audio Video, Times Multimedia, Sagarika, Sound Entertainment, Infotech Resources, Video Palace, Fountain Pixels, …
Even a player like Excel Home Videos which publishes top notch Hollywood titles and has the entire Disney library is extremely positive about local Indian animated content.
Some of Indian themed animated titles that Excel published are the bestselling Ramayana which was an Indo Japanese collaboration directed by Ram Mohan, GreenGold’s Vikram Betaal and and Graphiti’s J Bole Toh Jadoo.
Commenting on the demand for local animated content and his label’s approach to the same, Excel Home Videos MD Muslim Kapasi remarks, “While Excel has one of the best catalogues in International animation as well as Hollywood, we are very well aware of, and have participated in the growing emergence of original Indian content on Home Video. Ramayana has done more than 200,000 units. We have also published Greengold’s Vikram & Betaal and have timed the release of Graphiti Multimedia’s J Bole Toh Jadoo with Krrish’s theatrical release”
“The kind of strength and relationships we have built in terms of marketing and distribution will now reflect in the good numbers that we will achieve with the best of Indian animated content that we have and will continue to acquire” he adds.
Is Excel interested only in the big brands and big studios? “For us quality is the criteria and quality in Indian animated content could also mean in terms of the cultural relevance and the aesthetics. We are always keen to collaborate with Indian content studios and are also willing to co finance/ co own projects if they match our expectations” is Kapasi’s reply.
The quality criteria
The sentiment that most of the publishers echo is that Quality in the local animation market has more to do with good storytelling which is of primal importance. Creating content around public domain stories and mythology is the norm.
Not that studios are lacking in original contemporary ideas, in fact in the future, sophisticated urban humor as well as trendy spoofs & gags might emerge as a bright niche too, but currently the overall market scenario in home video is much more conducive for mythological fare.
Looking forward, production values as well as technical finesse are going to be essential too.
Shethia Audio Videos has been a home video publisher for decades. Four years ago it got into animation production. CEO Amit Chedda points out, “A good percentage of our overall business is in animation titles. Consumers want Indian animated content, and the business opportunity there, coupled with our reach to market, made it a logical extension to get into production.”
“Culturally relevant subject and theme is what makes the sale happen here, but increasingly consumers are expecting better production quality. Initially since there wasn’t much Indian content available, anything that was Indian themed worked. Now that choice is available, the better produced ones obviously will win in the long run” he adds.
Religious / Heritage based content
Be it live action or animation, broadcast or home video; religion and mythology sell well in India. There are numerous Religious Institutions and Organizations in the country that keep commissioning animated content.
Bangalore based Mediateck has really explored this turf well. Eight of its religious home video animated features have already released and three are currently under production. All of these were commissioned by various Religious Organizations and with good budgets. Of late the content creator is also looking at working with pure play home video publishers.
Mediateck CEO Balakrishnan comments, “Encouraged by the success of recent Indian animated content, home video publishers and distributors are now looking to invest good money in titles. This is a very positive development. We have usually dealt with Religious Institutions and Organizations, but now with publishers also stepping in and looking to invest in quality, we look forward to working with them”
“Religious/ Heritage based content works very well because today parents are constantly struggling in their efforts to impart cultural and moral values to their children. What better way than animated content in which the values could be imbibed in the kids?” he quips.
Regional: The big opportunity
Another trend and business opportunity lies in creating regional content. Aurangabad based Jingle Toons has made a name for its brand by creating animated Marathi Song albums.
Jingle Toons Director Sandip M Pathak remarks “With the changing times, and growth of media, people get exposure to all kinds of content. The International players and the big national players are very strong in marketing, they can push their product. But most of their content doesn’t have regional and traditional flavor to it. Our experience is that people take keen interest in regional, traditional content for their kids. The home video platform is best suited for offering this kind of content to kids”
“Our animated Marathi lokgeet albums , Sasa to Sasa and Choclate cha bangla have really caught on with the masses. Sales have crossed more than 50,000 units each for both the titles. Encouraged by this regional response we have also created Gujrati, Hindi and Telugu content and are planning for the other languages” he adds.
“Because kids are exposed to technically superior content, matched with the best presentation, regional content creators too have to focus on improving in terms of technical as well as production values to stand up in the market” he points out.
Commenting on this topic, Dawsen’s Bhalotia points out, “Home Video comprises 50% of all of our revenues. Our show Thakurmar Jhuli is a TRP topper on Zee Bangla and that only helps us exploit home video better. Regional content made and marketed well, definitely has a great audience, but the content should be also able to crossover to help exploit other markets and revenue streams”
Growing hardware penetration, expansion of the Indian animation universe and the emergence and subsequent growth of organized retail indicate that the home video animated content market is set to grow further.
It seems likely that such content in the future would be divided into four categories:
(A) International animated blockbusters and brands like Madagascar, The Incredibles or Bob the Builder;
(B) Indian animated blockbusters like Hanuman or Ramayan;
(C) Culturally (contemporary as well as traditional) relevant stories, mythos and religious content like Panchatantra & Mahabharata as well as animation spinoffs from Bollywood;
(D) Generic International public domain titles from the smaller International studios.
Of these, the markets for the first three categories are strong, with most growth most likely to happen in categories B and C.
The success of a business ecosystem can not be deemed complete until even the smallest of players has opportunity. The emerging opportunity in the home video space for start ups (as well as established players), adds to the overall evolution of the Indian animation ecosystem.
Embedded with challenge plenty, but no barrier to entry!
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