Wednesday, December 12, 2012

MEDIA AND ENTERTAINMENT: SOME HEARTBREAKS

Why bloopers count even in the world of media & entertainment

Then there is the media mughol Rupert Murdoch, who bought the baseball franchise Dodgers from the O’Malley family in 1997, for a whopping $311 million – a high price at that time. Murdoch bought Dodgers hoping that it would complement FOX Sports’ content. But post-deal, Murdoch renewed the contracts of all the players, because of which, their remunerations shot-up by as high as 50%! However, the revenue prospects worsened... Finally Murdoch sold Dodgers for $439 million in 2004, incurring losses amounting to millions of dollars in the process... Another blunder was made by NBC, when it cancelled the Baywatch TV show after just one season (in 1989) for lack of viewership and high costs. Then, David Hasselhoff invested his own money in it and relaunched it in 1991. The show became the most-watched TV show of all times, with 1.1 billion viewers! To sign off, here’s another one from Decca Records when it rejected an unrecognised music band in 1962, stating: “We don’t like their sound, and guitar music is on the way out...” The band was later signed-up by EMI and became an instant hit. You know it as ‘The Beatles’ today! Similarly, Universal Studios approached Mars to use M&M’s in their new film to be directed by Steven Speilberg. Mars refused and Universal struck a deal with Hershey. The movie was The E.T. – one of the biggest hits, ever!

Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri

For More IIPM Info, Visit below mentioned IIPM articles.

Posted by at
Labels: , , , , , , , , , , , , ,

Sunday, December 9, 2012

Filmmakers chase the ‘Long Tail’

Reaching out to the perfect audience in newer ways…

Typically, the months leading up to summer are quite dry at the box office when it comes to new films. Studios and producers are busy devising strategies for the big budget summer releases and rarely, if ever, look at the mass audience during this time. Of course, independent movie makers, a kind underrepresented in India but quite a force out west, look to make the most of the opportunity. So, last week you had movies like Nandita Das’ Firaaq, Raja Menon’s Barah Aana or Little Zizou, Sooni Taraporewala’s little Parsi flavoured oddball before that. Director Samir Karnik, who had made Heroes, is confident about the movie theatre’s future, “People still love going to the cinemas and like watching movies on the big screen.” But in the same breath he says, “It’s not easy for everyone to afford a movie in the theatres, that’s the reason they find the easier way and watch movies on the net or otherwise.” That begs the question: Are there ways other than the silver screen to reach out to the targeted audience?

Of course, there are the usual rounds of the festivals and even direct to DVD releases but in this age of media driven by people power (think YouTube, Facebook etc.,) shouldn’t filmmakers, producers, studios and distributors be also thinking of ‘alternative’ channels of reaching out? Even if in limited numbers, they actually are. Director Wayne Wang (Maid In Manhattan) premiered his film The Princess of Nebraska in 2008 in the ‘You Tube Screening Room’ whereas Steven Sorderbergh plans a simultaneous video-on-demand release for Che.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri

For More IIPM Info, Visit below mentioned IIPM articles.

Posted by at
Labels: , , , , , , , , , , , , , , ,

Friday, December 7, 2012

POSCO INDIA: SOUNG-SIK CHO

After Cho’s failure to get the Orissa project up and running, Posco must look for an Indian CMD

All these stand testimony to the South Korean steel makers’ India predicaments. Cho, who had earned name and fame across the globe for his acumen in setting up greenfield projects, was bestowed with the responsibilities of POSCO-India in 2006 to solve persisting problems, apart from ensuring smooth implementation of its various projects.

“During his four-year association with Posco India, Cho has a very little success to talk home about. During Cho’s tenure, violence at the proposed site delayed the implementation of the Rs.510 billion plant,” states S. Pattnayak, former chief Public Relation Officer, POSCO India, who had worked closely with Cho for over two years, and isn’t very positive about the work culture of the former CMD. “Although he is a good human being, and a good communicator, he was unable to build a cordial relationship between Korean & Indian employees,” says Pattnayak.

However, it would be completely one-sided, if we were to only consider Cho’s failures. During his tenure at the helm of affairs, Cho was able to obtain the state government’s recommendation to obtain a prospecting license for Posco in the iron-rich Khandadhar reserve. This was done despite stringent opposition. Besides, the company also obtained stage-I of the forest land diversion proposal clearance from the government. “But the ground reality is that there is not a single work done on the base level. And this is because of the mere negligence of the state as well as central governments. So I do not think it is a failure of Cho, I think it is the failure of Orissa government,” avers Dillip Satapathy, Orissa bureau chief, The Business Standard.

Despite this, Cho was left with no option but to vacate the coveted seat after three years at the top due to his inability to get the Orissa project up and running. Pattnayak pin-points, “Koreans do not tolerate failure, and Cho got punished for the same.” An announcement on the new CMD would probably come in any moment. The next CMD will have to make up for the weaknesses of Cho and ensure he can balance the cultural differences smoothly. In that sense, it would not be a bad idea to have an Indian candidate at the helm to better improve the chances of success.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri

For More IIPM Info, Visit below mentioned IIPM articles.

Posted by at
Labels: , , , , , , , , , , , , ,

Thursday, December 6, 2012

INDIA INC: SHARE PLEDGING

Companies need to be proactive with disclosure of pledging

The more serious issue, again when we think about Satyam, is that the funds may be going elsewhere. “If the company is ploughing back the funds that promoters have borrowed by keeping shares as collateral in the company itself, then there’s nothing to worry...,” explains Ashok Jainani, VP (Research & Market Strategy), Khandwala Securities Ltd. Pledging as a practice is being exercised since ages to raise money.

However companies used to evade disclosure of their pledging details earlier. “These are notable corporate names, which people trust and expect them to make disclosures on their own. It’s done voluntarily by most global firms,” says a noted financial analyst on condition of annonymity. Many such companies claim to uphold the highest standards in corporate governance. But by responding to SEBI’s directive, these companies have done little to reassure investors of the honesty of their intentions (if their intentions are indeed honest that is!). It’s imperative for such companies to mend their ways, just as it is imperative for SEBI to ensure that no defaulters are spared.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri

For More IIPM Info, Visit below mentioned IIPM articles.



Posted by at
Labels: , , , , , , , , , , , ,

Wednesday, December 5, 2012

JOB CUTS: LOGICAL OR SHEER WHIM-BASED?

Jobs cuts, during recession become a ‘necessary’ evil; and this is the only quick solution for companies...

So do announcements of an aggregate 2 million further drop in global employment count (on a single Monday; January 27, 2009) stand justified as the only short term solution? “Yes, this is perhaps the ‘safest’ and ‘most prompt’ decision at the hands of the decision makers,” thumps Van Jackson, Senior Strategy Consultant and Analyst (Foreign Policy). What makes the case of job cuts stronger is that it is not a very common sight to witness such a move across boards, across industries. It’s not just financial, real estate and auto sectors (the biggest bailout grantees) that stand guilty of handing over pink slips, but companies even in the retail, IT and pharma verticals are making it to the headlines for similar reasons. This recent occurence has therefore proven how it is the ‘demand side’ of the market that is to be blamed for disturbing the equilibrium, which therefore called for a reduction in supply for even maintainence of reservation prices by the companies. And as we consider production economics, a reduction in the ‘L’ (read ‘labour’) factor remains the quickest overnight solution to enforce a production scale cut; hence tormenting job cuts and in thousands! Even David Haigh, CEO, Brand Finance, agreeingly states that, “Companies get hit when salaries become more than the revenue. The current economic turmoil has catalysed the heavy retrenchments taking place in many leading global organisations as they seek short-term measures to cut costs and reduce debt...”

Now for the brighter side of the picture: one party that would be most fearful of the downturn (after the ‘employees’ group) is the army of companies’ shareholders. As per a February 2009 World Bank and S&P report, a gutwrenching $15.53 trillion have been wiiped-off at the bourses during the past 12 months, thus representing a total global stock value erosion of 44.09%! Worse, bourses in emerging markets have been reduced to less than half in value during the given time interval (-51.82%)! Understanding how Jack made job cuts count positively for GE’s stock price and market value, investors and shareholders across the globe can hope that their companies will make the most of the announced and future (more?!) jobcuts, thus giving their stocks a better shot at appreciation. And isn’t the primary objective of a pulicly traded entity protection of its shareholder interests? Isn’t it Jack?


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri

For More IIPM Info, Visit below mentioned IIPM articles.


Posted by at
Labels: , , , , , , , , , , , , , , ,

Monday, December 3, 2012

M & A The Perfect Corporate Crime

CEOs have ripped apart shareholders’ wealth globally under the guise of M&As; Indian firms more so! B&E’s Manish K. Pandey, Deepak R. Patra and Karan Mehrishi undertake the most radical analysis of the recent past and destroy age-old perceptions!

The pity is, Indians never learn! You’ll get the drift by the time you end the introduction. First, the dirt! The year 2000 was the eve of the glorious new century, and a boon for the Big-6 M&A consulting firms. And why not! For these global consulting proponents, an example like the year 2000 Vodafone-Mannesmann merger was god’s gift multiplied many times over. It was proclaimed to be the single largest deal in history. Sir Christopher Gent, then CEO, Vodafone paid a smashing $190 billion for Germany’s Mannesmann AG, making Vodafone the biggest operator in Europe. The combined entity was valued at $365 billion, making it the world’s fourth largest company overnight. What better a gift could the M&A brayers ask for? Wasn’t this M&A deal enough proof that M&As were/are the only dynamic and rapid solution forward to mammoth growth and that all those who had criticised M&As for the past so many years were nothing but dimwits?

If Gent’s strategy cup ran full of suicidal moves, Arun Sarin – who was on the Vodafone board since June 1999 (and was equally, if not more, to blame) and who took over from Gent in April 2000 – redefined the standard of how much shareholder value could ever be destroyed from a company. Eight years since the deal, the value of Vodafone in terms of market capitalisation stands at $161.4 billion (as on July 24, 2008), down by a sickening $203.6 billion, a fall of 53%! Arun Sarin ensured that in the last eight years since the merger, Vodafone has become the biggest loss making company ever in the history of mankind! The loss: $86 billion! Both Arun Sarin (who exited in June 2008) and Christopher Gent, apart from the other top management, retired multi-millionaires, a far cry from thousands of Vodafone pauper shareholders.

If that sounded absurd, Gary Foresee took on the infamy mantle with ease. Gary joined Sprint as CEO in the year 2003. Signing bonus amount: $6 odd million! Subsequent years’ pay: Between $1.5-6 million! Gary’s claim to (in)fame was ensuring Sprint’s spectacular merger with Nextel in 2004-05. He sold the deal on the fact that the combined telecom giant would have a subscriber base of 53.8 million in the US! What he sweetly left out was the disaster the deal could be. At the time of the deal, the Sprint Nextel common stock was trading at $26.9; it’s at a sickening $8.30 today! While many shareholders got wiped out Mr. Gary Foresee was kicked out at the end of 2007. His severance package? $40 million!


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri

For More IIPM Info, Visit below mentioned IIPM articles.

Posted by at
Labels: , , , , , , , , , , , , ,

Sunday, December 2, 2012

PEPSI: LOW COST PARADISE

Pepsi’s new initiative in rural markets faces a branding challenge

Health continues to be the predominant plank for Pepsi. Indra Nooyi affirms, “Pepsi’s beverage portfolio in India is 30: 70 proportion of ‘good for you’ product: ‘fun’ product. But we would be making it 50:50 by focusing more on healthy lines.” Apart from that, the company wants to engage in manufacturing healthy products for the poor who suffer from deficiencies of key micro nutrients like iron and Vitamin A. The genesis of a Re.1/Re.2 product line is expected very soon for the rural market.

It’s basic economic theory that in a slowdown, FMCG would be one of the last to fall, as it accounts for a miniscule part of the buyer’s income. And when we talk about Re.1 shampoo satchet’s or Re.2 health products, they are quite a potent insurance for slowdowns! But in a market used to the likes of Parle-G and Britannia Tiger, Pepsi will have to face quite an uphill communication challenge. It is being speculated that the company may do a brand extension of its Frito-Lay brand. That would indeed be a prudent step to overcome the branding challenge.


Source : IIPM Editorial, 2012.An Initiative of IIPM, Malay Chaudhuri

For More IIPM Info, Visit below mentioned IIPM articles.

Posted by at
Labels: , , , , , , , , , , , , , , ,
Subscribe to: Posts (Atom)