Areas of Service
Media & Entertainment
The growth of the M&E industry in India:
The Media & Entertainment (M&E) industry in India has experienced robust growth over the last few years and as per the FICCI-KPMG report1 on the Indian Media & Entertainment Industry, this industry is expected to grow further at a compounded annual growth rate of 15 % per annum over the next five years, to reach INR 1.4 trillion in 20162.
By opening up and relaxing the entry barriers for foreign investments in certain key areas of this industry, including the recent relaxation norms for the broadcasting sector (DTH, cable networks etc.), the Government of India has provided the sector much needed impetus for growth. Several segments of the industry (such as broadcasting, films, sports and gaming) have especially undergone unprecedented advancements on multiple dimensions. The use of the latest technology in all phases of production, digitization and globalization of content, the availability of multiple revenue streams, financial transparency and corporatization have contributed towards the paradigm shift that the M&E industry in India has witnessed over the last decade or so.
Globally, the potential of this industry in India has been recognised and has attracted foreign players who are keen to tap this industry. This is evident from the fact that in spite of the economic slowdown, the Foreign Direct Investment (FDI) received in this industry in the year 2011 was approx. INR 32.64 billion, which is 72% more than the FDI received in 2010-113. Some of the noteworthy transactions during 2011 included Walt Disney Company's acquisition of an additional 41% stake at a value estimated to be over USD 300 million in UTV Software (which took its shareholding in UTV to approximately 90%), Providence Equity Partners' private equity investment in UFO Moviez India ($58 million), and HSBC's private equity investment in Avitel Post Studioz ($60 million).
Changing trends in the industry
Growing need for documentation & awareness of Intellectual Property
Traditionally, the Indian film industry has been relationship based. The arrangements / agreements were either oral or scantily documented. This, however, meant the absence of a proper chain of title documentation leading to uncertainty in the flow of rights. In the past few years, the Indian film industry has woken up to the need of written contracts and protection of intellectual property rights ("IPR"). Banks, Indian corporations and foreign investors insisted on written contracts with producers and required them to have water tight contracts with the cast and the crew including appropriate chain of title documentation. With the increase in commercialization opportunities, even the talent that hesitated to sign a one-page contract until early 2000 has started presenting detailed written contracts to preserve their commercialization rights.
Losing inhibitions to approach the court to protect IPR and contractual rights
The M&E industry never gave much importance to the protection of IPR or contractual rights in general. The disputes were also usually resolved without going to arbitration or litigation. Moreover, the lack of documenting arrangements meant less opportunities of initiating legal proceedings. The scenario, however, has changed drastically over the past few years. Recent trends also reveal that the rights holders have become extremely proactive in taking disputes to courts for a multitude of reasons including infringement of intellectual property rights, breach of contract e.g. non-payment and non-fulfillment of commitments by talents and the like. The courts in India have also been supportive of the need to safeguard intellectual property rights, which has given further impetus to the faith of the right holders in the fair justice system of the country.
New monetization streams owing to technology & advent of New Media
The M & E industry has also expanded dynamically as it is not confined its contours to the traditional sectors of radio, print, films and television. The past decade saw the market players experimenting with the new technologies (such as internet 3G, 4G, etc.) for providing a better and innovative source of entertainment and in turn increasing the monetization streams. This led to the development of new segments of the industry such as gaming, animation and VFX, social networking and the like.
Role of the industry associations in standardizing the industry norms
The last few years have not only witnessed a flurry of changes in the legal and regulatory framework governing the M&E industry but has also seen an upsurge in proactive efforts being made by the industry bodies representing the stakeholders fervently taking up issues with the government on contentious matters affecting the industry. Industry bodies like the Federation of Indian Chambers of Commerce and Industry (FICCI), Associated Chambers of Commerce and Industry of India (ASSOCHAM), Association of Motion Pictures and TV Programme Producers (AMPTPP), Indian Motion Pictures' Producers Association (IMPPA), Film Writer's Association and the like have played a pivotal role in standardizing the practices of the industry. These industry bodies not only work towards the protection of IPRs, but also act as bodies of self-regulation, which have set out the norms followed by the industry players in general.
Major players in India
Important laws affecting the industry
The Copyright Act, 1957
The Trade Marks Act, 1999
Cable Television Network (Regulation) Act, 1994
Policy Guidelines for Uplinking of Television Channels from India
Policy Guidelines for Downlinking of Television Channels from India
Telecommunications (Broadcasting and Cable Services) Interconnection Regulations
Co- production treaties
Regulatory agencies overseeing the industry:
Ministry of Information and Broadcasting
Telecom Regulatory Authority of India (TRAI)
Central Board of Film Certification (CBFC or Censor Board)
Tax laws affecting the industry:
Income Tax Act, 1961
Sales Tax / Value Added Tax
Service Tax (Under Finance Act, 1994 as modified by Finance Act, 2012)
1 Indian Media and Entertainment Industry Report 2012