06 Feb 2013
‘India Will Be A Multi Screen Household’
Spuul's S. Mohan banks on a multi-screen approach to break into the Indian market
And this makes S. Mohan highly optimistic about his latest venture, Spuul, an online digital media streaming service. A serial entrepreneur, Mohan has had many trysts with technology enterprises and as the co-founder of Sppul Digital Entertainment, he intends to bring the classic and the current in Indian cinema and television, online. In an interview with BW Online’s Alokita Datta, he talks about his plans to showcase Indian media content worldwide, the growing popularity of online movie viewing in India and explains how Spuul’s multi-screen approach, which allows a subscriber to watch a movie across all platforms, will help them make headway in the Indian market.
When did you come up with the idea for an online film streaming portal and how do you plan to expand your services?
We started Spuul with the idea of doing something to Bollywood’s taste towards the end of 2010; that is when I met up with Sudesh (Iyer, founder of Sony Entertainment Television and co-founder of Spuul) and ran the idea by him. He found it exciting, since it was something they had thought of doing for many years; this is the next evolution of consumer technology where users would want to view digital content through mobile phones and connected televisions. We appointed our first key person, Prakash Ramchandani, who heads our South Asia operations. Our Mumbai office was opened in November last year.
In the first year of our business, we spent time talking to different content operators, explaining the business model around it and how it is going to be important because if look at parallel services (to Spuul), Netflix has been around for about 10 years in the US. On a base of around 300 million US residents, Netflix has about 30 million subscribers —they therefore have a 10 per cent penetration in the market. If you look at India, today, there is prominent over the top (OTT) operator who has got substantial penetration into markets, primarily because we are relatively new in the curve of adopting these kinds of services, but we believe that within the next 5-10 years this is going to be one of the most significant ways in which people will consume content. In a market of a billion people, we can foresee a considerable market size.
The subscription model is a combination of free streaming and pay per view content. However, there are a couple of websites, such as Filmlinks 4 u and others, which have a wide data base of films that can be accessed for free. How do you wish to set yourself apart through your pricing strategy?
The primary difference between what we are offering and what some of the other sites feature is a destination where people can come and watch their content; it is not a redirection service nor is it an aggregation of embedded links. The second differentiation is that we provide a premium service, wherein some content is free and some is paid. We do use advertising to buffer the price a little bit but ultimately we want to encourage customers to sign up for our premium content in the long run because they get tremendous value for it. For less than Rs 250, they get access to over a thousand movies, which are of high quality and can be viewed any time. Moreover, there is no restriction on which platform they can use the service on; they can watch movies on Spuul on their desktops, laptops mobile devices such as iPhone and iPad. We will be releasing our Android product very soon (in February 2013) and we already have our app on Facebook. Today if someone wants to watch films on Facebook, all they have to do is go our Facebook app where people can find all our content available there and will be able to access them in real time even as they chat with their friends. Thus, our objective is to allow users to be able to watch our content in any platform.
The striking feature of Spuul is that any subscription you take from one device carries on to other devices as well; for example, if you are watching a film on Spuul through an android device you can use the same account on the iOs, a connected TV or the web. It is not only integrated; it also allows users to continue watching their content from where they last left off, irrespective of the device and platform.
Even though the amount you are charging is nominal, don’t you think users (in India) have strong a tendency to gravitate towards free content?
It is difficult to compare our content to free content because consumers pay a lot for cable connections and the average price of a movie ticket on multiplex screens is anywhere between Rs 150-400. So it is not as if people are not paying, they are just selective about what they are paying for. We are allowing people to access the whole Spuul library for a very reasonable price. The predictability of going a library and watching content will make a big difference in our case as opposed to finding free content, which may be there one day and probably won’t be the next, in the case of pirated content.
Are you focusing primarily on developing products for mobile platforms?
Yes we are focusing on mobile but we will be releasing our TV apps as well for Samsung, LG and Google TV as well. The complete Spuul experience will be made available on smart TVs.
In a country like India even though broadband connections are widespread, internet speed varies and is contingent on different factors. How do you plan to address this issue when it comes to streaming films on Spuul?
The technology we use for movie viewing is called 'adaptive streaming' which in simple terms means that users on a slow connection get a slightly more pixelated video than someone with a better connection. To watch a movie one only needs about 300 kbps which is only about 5-10 per cent of the average 3G connection at the moment. However, we are working on technologies which we hope will allow people to have a larger buffer of the movie so that they can continue to enjoy the movies should the connection be lost for some minutes.
What is your strategy behind acquiring and classifying content?
Our philosophy about content acquisition is that we want to be a destination for premium content, like I mentioned, and in doing so we segment the market into two categories: one is older classics and the other is new content: from content that has been released in the last 2-3 weeks to those which are about 2-3 years old. This is both for television shows and movies so that people can also enjoy watching the shows and films they enjoyed watching in the past (older television serials such as Malgudi Days, Fauji etc). India produces so much content that there is no one system or provider who can cover all of that, so we are trying to pick and choose the better content. Over the next year we are planning to introduce more vertical content — genre specific content such as devotional, lifestyle— and content which is closer to day and date release. We have done this with a few movies (particularly small budget ones) already where after the film has released in India, Spuul has carried the movies worldwide. We intend to carry day and date releases for television serials as well and will be announcing some new programmes over the next few months.
We are also in talks with all the major television channels, and are looking at both archival and new content with a focus on classics and very current programmes. We expect Spuul to become a mainstream medium in the next 5 years, not just because of better Wi-Fi and 3G penetration but also because of access to better content and more platforms.
Do you intend to feature only Hindi/Bollywood films?
No, we are definitely interested in regional cinema as well. In fact, at the moment we have some regional content in Tamil, Telegu, and Malayalam and Bengali films and in our next batch we plan to add many Tamil films to our library and move towards expanding our collection of non Hindi content.
Since you are based in Singapore, does the Indian diaspora constitute a significant percentage off your viewership?
Spuul, as a service, is available worldwide and for most of our content we have global rights. If we analyse where are views are coming from, 45 per cent of our users come from India and of the 55 per cent distributed outside India, the US, the UK and the Middle East are big markets. Even with an international audience, we are always going to focus on high quality Indian content. Yes, our aim is to get content that will attract Indians both in and outside India so international award shows such as IIFA fit the bill. We would like to be involved in the Indian entertainment vertical as well.
Could you talk about your own involvement with media start ups?
I have been involved with start ups since the mid 1990s since when I have launched many, particularly in the technology domain. Over the years I have worked together with the Media Development Authority (MDA) in Singapore which identifies start ups and helps them with funding and therefore provides an opportunity for young start ups to access government grants to kick-start operations. I have been engaged in the incubation process of many such media start ups, either as a mentor or indirectly participating as a venture partner. Over the years I have helped starts ups either build a product or market it, where I combine my passion and expertise. When we started raising money for Accellion, a secure file transfer system launched in 1999, it was at the time of the dot com bust. Valuations were low and for the first round of funding I had t meet about 40-50 VCs before one of them decide d to invest. The investment cycle is cyclical, and I think I have tried to share my learning with a lot of the companies I have worked with. Every year when we do fundraising, we have a slightly different perspective on it.
From the time that you started your first enterprise to now with Spuul, how has the process of raising capital changed?
I think there have always been good investment houses that look at a product and person and make rational choices. As an entrepreneur it is important to figure out the people who would understand the domain you are operating in and pitch to them directly, as opposed to the others. The big difference between the VCs of today and those of yesterday certainly is that they understand change. During the dot com bust in the early 2000s, one could raise money just on the basis of a business plan. Today the market has matured and VCs are looking not just for a business plan but also an early product around which metrics could be measured. In case of Accellion, a lot of funding came from the US. In the case of Spuul, our big funding rounds will happen in India because that is where most of our customers will come from. I think in the next 12 months we will be doing our rounds of fundraising in India.
Is the market ready for digital media companies in India, in your opinion?
It is interesting that we are classifies as a digital media company, but if you look deeply at the service we are providing, it is very traditional; it’s the platform that is different. What we are going after is a subset of the market because in terms because the platform is relatively new but if you look at the number of mobile phones (600-700 million)or set top boxes in India they are very large. The way technology is moving today and the market is growing there will be tremendous segment of the population who will consume content through services like Spuul. At the moment India is still a one TV household, whereas many developed countries have multi TV households. However, India is going to be a multi screen household; there may be one TV but many family members have multiple devices. We will skip from being a multi TV household to a multi screen household. And that is where Spuul is very strong.
How do you plan to market Spuul in India; are you concentrating on online advertising?
We have invested in above the line advertising, some offline and some online. India being an Android dominated market we are waiting for our Android app to be released before be spend money on marketing it to the end consumer. At the moment the major content houses in India know us as well as the television channels and cable companies. But the average consumer doesn’t know much about Spuul today because we don’t have a product ready for them yet. But our Android product will address a large percentage of the population. Therefore, we will be investing in above the advertising, offline (print, radio, Television) primarily since it builds brand awareness.
We are keen on digital advertising too and are running a small Google ad words program at the moment as well, besides our presence on Facebook. We also have metrics that measure our return on investment and user acquisition.