Sony has leveraged competitive ad rates, limits on commercial time and high-quality original programs to lure advertisers from its major competitors-satellite broadcaster Zee TV and terrestrial broadcaster Doordarshan.
A THREAT TO ZEE TV
More than three years after its launch, Bombay-based Zee TV (50% owned by News Corp.) reaches 81% of all satellite- and cable-equipped homes. Doordar-shan, India's largest broadcaster, boasts 250 million viewers.
"We believe the leader's slot in this market is vacant, and we are working toward taking that slot," said Arun Arora, CEO of Sony Entertainment Television, which is owned 60% by Sony and 40% by Argos Communications Enterprise, a Singapore-based consortium of Indian investors. The channel is the second to whom the Japanese marketer has lent its name; the first is in Latin America.
Sony has pegged ad rates at levels lower than Zee's. For example, a :10-spot in prime time is $725 on Sony, one-third of Zee's rate. A similar spot on Doordarshan, with its tremendous reach, is $2,000.
Like rival Zee, Sony's channel broadcasts in Hindustani, India's major language. This enabled Sony to shoot ahead of well-known competitors. Most other channels-CNN, MTV, Discovery, the BBC-broadcast in English, so their viewers are concentrated only in the big cities.
But broadcasting in Hindustani broadcasting also creates problems. There is a plethora of Hindustani-language channels in India, 11 in all. As a result, there is a scramble for a share of the advertising pie and advertisers are offered substantial discounts on quoted ad rates.
Sony is denying recent charges printed in a cable industry publication that it gives massive rebates. Sony officials say bonus spots are thrown in as an added value for advertisers who go for bulk packages.
"We look at being advertiser-friendly," said Kacon Sinha, Sony's VP-advertising sales. "We offer benefits to the advertiser by way of a larger spread on the channel. As a channel we understand our position: There is the Sony brand name and our products are worth a certain value, so we will not resort to just any sort of price-cutting. I don't see giving bonus as price-cutting, I see it as a benefit for a larger reach on the channel."
The Sony channel prides itself on programs with a quality look tailored to its Indian audience. And fresh acting talent was introduced to distinguish Sony from other channels that continually use the same familiar actors.
"The program content is as good as the best in the country," said Nabankur Gupta, director-marketing at Bombay-based Videocon, India's largest maker of TVs and washing machines.
To get clearer transmission quality, Sony introduced digital tapes, and loosened purse strings for lavish shoots of soap operas and serials. Sony spent $1 million on graphics, logo and other presentations of the channel's look.
MAKING CLUTTER AN ISSUE
In addition, Sony boasts a minimum of ad clutter: "We are the only channel that declared .... we will not have more than 10 minutes of advertising in an hour, so the viewer doesn't get fatigued and the advertiser gets value for its money and is not lost in the clutter," Mr. Arora said.
An hour on Zee may have 15 minutes of ads; Doordarshan has no limits on ads per hour.
The Sony channel largely promoted itself on its own channel, in between programs. Ammirati Puris Lintas India, Bombay, launched a 15-day print and outdoor campaign when the channel debuted. A series of FM radio spots is running currently.
Today, the 18-hour Sony channel boasts 90 major advertisers. Sponsors include Western-owned marketers such as Johnson & Johnson, as well as Indian marketers such as cigarette maker ITC Ltd. and dairy products giant Amul.
In its initial year, ending in September, the Sony channel will record ad revenues of $20 million, predicts Mr. Arora. But that pales in comparison to the market leaders. Last year, Zee TV reported revenues of $66 million, and Doordarshan garnered nearly $232 million in ad spending.