India’s biggest record label T-Series has grown at whirlwind speeds in recent times.
After months of competing neck-and-neck with Sweden’s PewDiePie, the homegrown company became YouTube’s numero uno channel by subscribers on March 29. Led by chairman and managing director Bhushan Kumar, the music and movie production company expanded its subscriber base on YouTube from 30 million at the start of 2018, to 70 million within a year. It is now nearing the 100 million subscriber mark.
After acing the YouTube battle, Kumar and his team are now working on strengthening T-Series’ digital offerings, which has emerged as the Mumbai-based company’s biggest revenue source. In an interview with Quartz, he talks about how critical it is to churn out good content, stepping up the company’s game in films, and the necessary evil that smartphones are.
Edited excerpts from the interview:
What does being the number one channel on YouTube mean to you? Does it help business?
We were never in this tussle to become number one or two with anyone. But all along there were these sarcastic comments from PewDiePie. And that’s how we decided to respond to the comments. I launched the #BharatWinsYouTube campaign, seeking more subscriptions from Indians. For us, this status does not result in any change on the commercial front. However, it changes the perception about who we are. With these developments, T-Series gets promoted. What is heartening is that now we are seeing growth even in countries where people were not watching our channel earlier.
Has online as a medium become big enough to start contributing significantly to your revenues?
Digital today is the biggest revenue stream for anybody. At T-Series, we count some parts of revenue coming from TV under the digital head. We have divided our revenue into physical and non-physical sources. So, in that sense, online platforms, that is excluding TV and radio, contributes anything between 60% and 70% to our revenue.
Are you creating content exclusively for the web?
When it comes to music, we tied up with (the music streaming app) Hungama as early as 2005. It was our first digital streaming partnership. At the time, the association was more about promoting caller tunes. Today, there are multiple players in the music streaming space alone. There is JioSaavn, Gaana, Amazon Music, Spotify, Apple Music, and Airtel Wynk. We have partnerships with most of these players.
We are also into creating content for web series. For us Hotstar, Amazon, and Netflix are good platforms. Work on web series is in its initial stage. We are working on content and partnerships. We do not have specific investment numbers to give out for that.
You are also betting big on films?
We have 20 to 25 film projects. We are backing good content-driven films. The company has movies like Bharat, Tanhaji: The Unsung Warrior, De De Pyaar De, and Bhuj: The Pride Of India. T-Series is doing four projects with actor Ajay Devgn. Then we have one with Ranbir Kapoor. We are investing Rs500-600 crore in films this year.
What do you think is the future of over-the-top (OTT) and digital media in India? Will it kill TV and cinemas?
Smartphone usage is on the rise and mobile data is getting cheaper. People are watching a lot of content on their smartphones. So, digital has a bright future in India. TV is also there to stay. Those who are in the TV business say advertising revenue is growing 15-20% per year. In comparison, digital is growing four-fold annually. Irrespective of the medium, it is good content that is going to win the game.
Digital platforms have offerings at cheap prices. Movie tickets are still expensive. Shouldn’t there be a price correction at cinemas?
Digital platforms are priced cheaper because they have an advertisement-led business model. In the movie business, the value chain is completely different. Theatres works on occupancy levels. Even if there are just 15 to 20 people, you have to run the show for them. They say they are running losses, hence increasing prices is not the solution. Also, theatres claim they do not make much money, but their valuations are on the higher side. I am not in the theatre business, so I am not in a position to point out what are the exact dynamics.
We are into production and distribution of movies, so from our point of view, hiking prices is not an option. We want to see more screens being added and ticket prices going down to attract more people. Pricing has to be reasonable.
Have you set up a separate team for digital? How big is the team and what is the mandate given to it?
We run our digital team on the lines of a boutique firm. We do not believe in keeping 100 people, instead, we have a team of 20 running our digital business. It is led by a bunch of our senior-most people.
Do you enjoy this shift in consumer preference from theatres to smartphones? Have you shifted, too?
For a businessman like me, smartphones are a lifeline. I use the device to watch promos of my films, songs, and videos. There are days when I end up spending as much as five hours on the phone.
Using a smartphone for long hours is stressful, bad for the eyes and overall health. But a smartphone is a necessity today. You cannot do without it. Obviously, over-usage of everything is bad and the same holds true for a smartphone as well. We need to watch the time our kids spend on the device. There are times when I wish I could go back to my good old (feature) phone with no internet.