Covid-19 and Entertainment of 700 Mn people in the country. The next driver is the low
cost of data which is taking away the cost barrier from the minds of customers while they
are streaming content.
Content streaming is now both accessible as well as affordable, and were still at the
tip of this iceberg.
The other contributor is the changing family dynamic wherein its increasingly
acceptable for different members of the family to watch different content on their
respective devices at the same time. This means not only are more hours of content being
consumed per family, but also the consumed content is more varied, creating space for both
traditional and new-age story content creators.
The digital revolution has other implications on the content economy. On-demand content
makes it imperative for creators to use every available trick in the book to ensure the
audience stays with them and does not switch to something else. We are seeing a trend of
popular music being used to drive narrative and emotion in many of the recently successful
shows such as Aarya (Disney+ Hotstar), Delhi Crimes (Netflix) etc.
Content creators who are well-funded with strong delivery processes and the backing of
an existing IP bank will be well-positioned to take advantage of this opportunity. The
other positive change is the slowly rising popularity of Indian content across global
audiences. This is triggered by the easier availability of Indian content across all
global digital streaming platforms, and an increasing willingness to watch content with
subtitles.
Here, its not just the A-lister films, but smaller thematic films and Indian music
thats getting appreciated. Great news for Indian content owners/creators as it will
ensure higher value for every minute of content owned/created.
As the Pandemic slowly draws to its endgame and we start to see the proverbial light at
the end of the tunnel, the mood turns upbeat. This is reflected in bullish trends seen in
stock markets worldwide, which are seen as a barometer of optimism in the future.
City Pulse Multiplex Limited (CPML) is uniquely poised to take advantage of 2 factors
at play here - optimism and celebration mean a directional return to pre-pandemic
consumption - with the demand for entertainment going up, while the enforced stay-at-home
rules have accelerated the rate of adoption of digital entertainment.
As a pure-play content company, CPML is both recession- proof as well as bounce-back
friendly.
Media & Entertainment Industry
According to FICCI, the Indian M&E sector was growing @ 9% till 2019 and expected
to reach INR 2.23 Tn by 2023.
All was on track till Covid-19 impact adversely hit parts of the industry, some
short-term (advertising dependent businesses) and others medium-term (out-of-home
experiences). But it also gave a huge fillip to in-home consumption (Films, Series, Music,
Gaming). The gainers have been the digital platforms (Video and Music) who have seen
tremendous growth in both first-time users as well as time spent per user. But amidst all
this, the biggest beneficiary has been Content. There is more content getting consumed by
more number of people in the post-Covid era than the pre-Covid one. The digital revolution
has been knocking at the door of entertainment industry for some time but is now set to
boom.
This is courtesy multiple infrastructural and social changes happening in our country.
The foremost is the explosion of smartphone ownership which has put a smart TV screen in
the hands.
Changing Media Consumption
Over the next decade, over two dozen well-funded video and audio OTT platforms will
fight amongst themselves and with the existing 900 TV and 360 radio stations in India for
the consumers time and money, and the weapon of choice in this war will be Content.
Though theoretically speaking, the platforms can create content themselves, but in
reality, the sheer volume and quality of content will ensure that most platforms work with
high-quality Content Creators.
Films
The last few years have been favorable for the Indian film industry with the growth
coming not only from domestic box-office collections but also overseas theatrical releases
and escalation in satellite rights values. Indian consumers have also taken to online
video viewing in big way.
As per E&Y, the country is expected to become the second largest online video
viewing audience globally.
With its decade-old experience in industry, years of creating hit TV series, proven
track record of making high-concept tight-budgeted films in large numbers, existing
relationships with leading digital platforms, TV channels and film production studios,
across all Indian languages, CPML is uniquely placed in the Content Creation ecosystem,
both in audio and video.
Add to this the companys strength in product development, marketing, investments in
data analytics and 30k+ strong retail network, and you get the most unique Content Company
in India.
CPML is pinning its growth ambitions on 3 pillars: developing an OTT platform, creating
new IP, and the direct-to-consumer business.
This exponential growth of video consumption over digital media has encouraged the
entry of large global digital video players by launching their platforms.
To gain a foothold in Indias highly competitive OTT segment, there is a frenzy among
the global players to sign content licensing deals with local content makers to expand
their content library. They are investing heavily in original film content to meet the
audience demands.
To capitalize on this growing video boom, CPML decided in 2020 to launch into the
promising business of Digital Films under the sub-brand, WOWPLEX. WOWPLEX is a fully OTT
Platform that will aimed at the growing digital-first audiences.
The focus is on talent discovery, methodical decision-making in story selection,
transparent processes and profit-sharing with talent as well as keeping line production
fully in - house to prevent budgetary overruns. Some of the Blockbuster movies poster is
presented here.
OTT on an uptrend post-digitization
The digitalization of the media and entertainment industry has been driven by changing
consumer behavior and expectations, especially among younger generations who demand
instant access to content, anytime, anywhere.
A combination of -
4. demographic,
5. consumer and
6. technology trends
is dramatically remodeling the media landscape. From buying a newspaper to opening a
news app on your tablet, from renting a DVD to streaming your favorite television series
on a smart TV, from buying a cookbook to getting customized recipe suggestions on your
smartphone, its undeniable that the digital transformation of the media industry has
already begun.
ONLINE VIDEO MARKET ANALYSIS
1. Growing mobile and smartphone penetration has boosted adaptation of online video
viewing in India. Online video streaming market is driven by increasing smartphone,
affordable data charges and availability of creative video content.
According to the Media and Entertainment Outlook 2020, India is likely to emerge as the
worlds sixth- largest OTT (over-the-top) streaming market by 2024.
The market is expected to post a CAGR of 28.6% over the next four years to generate
revenue worth US $2.9 billion.
According to a Media Partners Asia report, Indias online video market is likely to
post a CAGR of 26% to reach US $4.5 billion by 2025. The report anticipates the SVoD
(Subscription Video on Demand) market to accelerate at a 30% CAGR and reach US $1.9
billion by 2025.
India is at the forefront of the global digital revolution.
Our Company "City Pulse Multiplex Limited" desirous to enter into an online
digital media services as there is surge in Digital Media segment of the media and
entertainment industry in the real world. The company has launched an OTT Platform named
as "WOWPLEX". The company has also intimated to the Stock Exchange about the
same.
1. Prime factors of OTT Platform
Government Recognition/Support to OTT Platform aiding to Industry growth:
Extreme demand in the Digital audio-visual content requires the authorities to include
and formulate rules and regulations under the broadcasting including films and web shows
on over-the-top (OTT) streaming platforms, as well as news and current affairs on online
platforms, have been brought under the Ministry of Information and Broadcasting in
November2020.
The Government of India has supported Media and Entertainment industrys growth by
taking various initiatives such as digitizing the cable distribution sector to attract
greater institutional funding, increasing FDI limit from 74 per cent to 100 per cent in
cable and DTH satellite platforms, and granting industry status to the film industry for
easy access to institutional finance.
National Digital Communications Policy-2018- Both the telecommunications and the
M&E sectors are part of the union governments Make in India plan and therefore were
given special attention. In September 2018, the government released the National Digital
Communications Policy-2018 (NDCP- 2018) catered towards the establishment of
"ubiquitous, resilient and affordable digital communications infrastructure and
services"
? Its key objectives include:
1. providing universal broadband connectivity at 50 Mbps to every citizen
2. providing 1 Gbps connectivity to all gram panchayats by 2020 and 10 Gbps by 2022
3. ensuring connectivity to all uncovered areas
4. attracting investments of US$100 billion in the digital communications sector
5. training one million manpower for building new age skills
6. expanding the Internet of Things (IoT) ecosystem to five billion connected devices
7. facilitating Indias effective participation in the global digital economy.
Digital Security and Ethics:
There are also rising expectations from the consumers about what platforms should be
doing in terms of content moderation. Theres another powerful force acting as a spur to
regulation: consumers growing societal awareness manifesting itself in rising demand for
values and concepts such as social justice, content moderation, safe digital spaces, and
diversity and inclusion. Across the world, consumers have rising expectations surrounding
environmental, social and governance (ESG) issues and, especially, concerns over online
harassment and data privacy.
According to a survey Industry expert professionals, 2021 digital and ecosystem report
found that 76% of consumers globally think sharing their personal information with
companies is "a necessary evil," and 36% are less comfortable sharing their
information now than they were a year ago.
Regulation of OTT Platforms and other social media intermediaries:
Digital platforms in India have been unregulated, having no specific regulatory
framework barring the provisions of the IT Act that they are subject to. Through several
case laws and consultation
Papers and self-regulation codes formulated in the recent past, several attempts have
been made to understand the need for and method of regulating digital content. Attempts
were made by OTT players towards developing a more transparent system of self-regulation.
MEITY and the Telecom Regulatory Authority of India (TRAI) maintained their positions
of having no control over online content while the courts established the capacity of the
IT Act to regulate this space. Courts have held that actions against OTT players would be
taken under (a) Section 69 of the IT Act which includes direction for interception,
monitoring or decryption of information, blocking of content etc.; (b) Sections 66A and
67B of the IT Act that prescribe the punishment for offences such as sending offensive
messages through communication service, publishing or transmitting obscene material in any
electronic form.
Future Outlook
As we look ahead to 2022, the outlook for E&M, although challenging, remains
essentially positive. The powerful shift to digital behaviors will provide a strong boost
to global growth in these industries for the next several years. And as companies race to
meet consumers where they are with an ever-expanding range of products, services and
experiences, the E&M industries will grow more pervasive, more immersive and more
diverse.
But in many instances, the growth—and hence the rewards—will be asymmetrical.
Just as the economic and health recoveries from COVID-19 will not be equally distributed
around the globe, there will be a significant unevenness in the prospects for individual
E&M sectors and for companies that focus on particular geographic markets. Even in the
areas that offer the most compelling topline growth, such as video streaming, the basis of
competition is likely to change dramatically over the coming years. And all the while, the
social, political and regulatory contexts in which all companies operate will continue to
evolve in unpredictable ways.
All of which means that sitting still, relying on the strategies that created value and
locked up market share in the past, will not be the most effective posture going forward.
The world is beginning to emerge from the painful shared experience of the pandemic. Amid
destabilizing power shifts, those who lean in to the changes, probe the data and seek deep
insights from their customers, co-workers and collaborators will maintain their
balance—and be well placed to reap their fair share of future growth.
The Company "CPML" future prospects are very high, as it had already launched
OTT Platform named as "WOWPLEX" which will soon be coming with many Web series,
movies, short stories and etc.
ENVIRONMENT, SOCIAL & GOVERNANCE
Our Thoughts and roadmap for implementation
ESG incorporation has emerged as a tool for businesses to become resilient and remain
successful over a long period of time along with promoting sustainable development for
all. CPML understands the extent of impact its business has on the global community and
recognizes its duty to conduct business in a socially responsible manner.
Towards this, the principles of ESG incorporation in a businesss philosophy act as a
guide through which an organization can enhance its ability to conduct business with
transparency and efficiency.
Environmental, Social, and Governance (ESG) aspects refer to the three central factors
in measuring the sustainability and societal impact of a company or business.
ENVIRONMENT
CPML is committed to minimize its impact on the natural environment and conduct
business in an environmentally responsible manner.
SOCIAL
CPML is committed to building and nurturing relationship with all its stakeholders
based on the principle of dignity, respect and creation of positive impact for all.
GOVERNANCE
CPML is committed to instill and always uphold the highest standards of Corporate
Governance to promote ethical, professional and responsible business practices within its
operations and sphere of influence.
Towards this, the principles of ESG incorporation in a businesss philosophy act as a
guide through which an organization can enhance its ability to conduct business with
transparency and efficiency.
CAVEAT
This section of the Annual Report has been included in adherence to the spirit
enunciated in the Code of Corporate Governance approved by the Securities and Exchange
Board of India. Shareholders and Readers are cautioned that in the case of data and
information are external to the Company, though the same are based on sources believed to
be reliable, no representation is made on its accuracy or comprehensiveness. Further,
though utmost care has been taken to ensure that the opinions expressed by the management
herein contain its perceptions on most of the important trends having a material impact on
the Companys operations, no representation is made that the following presents an
exhaustive coverage on and of all issues related to the same. The opinions expressed by
the management may contain certain forward-looking statements in the current scenario,
which is extremely dynamic, and increasingly fraught with risk and uncertainties. Actual
results, performances, achievements or sequence of events may be materially different from
the views expressed herein. Readers are hence cautioned not to place undue reliance on
these statements, and are advised to conduct their own investigation and analysis of the
information contained or referred to in this section before taking any action with regard
to their own specific objectives. Further, the discussion following herein reflects the
perceptions on major issues as on date and the opinions expressed here are subject to
change without notice. The Company undertakes no obligation to publicly update or revise
any of the opinions or forward-looking statements expressed in this report, consequent to
new information, future events, or otherwise.
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