Disney is dispensing with Star India's old ways of doing business and building it anew. But will it work?
The news of Uday Shankar's exit didn't come as much of a shock, since the DNA of Star and Disney are so different. Image: Joshua Navalkar
That Disney appointed a 21st Century Fox executive to head its Asia Pacific operations months before the takeover was complete in March 2019, rather than the Disney India head at the time, is testimony to Uday Shankar’s enormous clout. As part of the $71.3 billion dollar deal, Disney added the Rupert Murdoch-owned Fox’s television and movie studios—responsible for hits like Avatar and Deadpool—stakes in Hulu and pan-European media group Sky, as well as Star India’s television and rapidly growing streaming service Hotstar, which Shankar built from ground up.
A reporter with a news daily, Shankar shifted to broadcast media at a rival organisation before taking the top job at Star India in 2007. At the time, Star India was a minnow. Its channel portfolio was limited, it had a small presence in regional languages and slipped from its leadership position in the Hindi general entertainment category (GEC) to rivals Zee and Sony. Revenues at the time were about Rs 2,000 crore.
Today, Star India is a broadcasting behemoth—a front runner in general entertainment with a presence in almost every Indian language; a dominant sports broadcaster with a 65 percent share of sports viewership in the country; and leader in the OTT space with Hotstar claiming 300 million monthly active users. Revenues in March 2019 were Rs 12,341 crore, up 35 percent the previous fiscal. The growth came at a cost though, with Star India notching up losses of Rs 1,261 crore, as against a profit of Rs 287 crore in March 2018. “He’s taken the company to a whole new level,” says one broadcast media industry insider, requesting anonymity.
Yet, news of his resignation on October 8 didn’t come as much of a shock. “I’m surprised Uday stuck on so long after the acquisition. I thought he would leave much sooner because the DNA of Disney and Star is so different,” adds the insider. While Star India has a quick-footed, entrepreneurial culture, Disney has a more process-driven, risk averse style. The cultures were bound to clash.
Says one former senior executive, “The Murdochs gave Uday a free hand in decision making, whereas with Disney every decision has to be run through Burbank [Disney’s headquarters in California].”