India is the third largest TV market in the world with a total strength of 161 million TV households only next to China and the USA. But a lot needs to be done for the growth of Animation, Visual Effects, Gaming & Comic Sector, feels Ashish Kulkarni, in this policy roadmap paper.
Future Policy Roadmap: 2015-2016
Restore STPI advantage scheme for AVGC or ITES for another 10 to 20 years but cover/encourage IP creation to bring about a level playing field for Indian content creators in global arena
The Indian economy underwent economic reforms in 1991, leading to a new era of globalization and international economic integration. Economic growth of over 6% annually was seen during 1993- 2002. The new administration under Atal Bihari Vajpayee 1999 government placed the development of Information Technology among its top five priorities,it formed the Indian National Task Force on Information Technology and Software Development. This lead an explosive growth in the IT sector.
As a result India today is considered a Global Super Power in IT. The Indian IT industry has contributed immensely to the growth of the country. The industry has seen massive growth, from very humble beginning in the 1990 the industry is estimated to aggregate revenues of US$ 108 billion in 2012-13, with the IT software and services sector (excluding hardware) accounting for over US$ 95 billion of revenues.It has generated millions of job and has contributed immensely to the foreign exchange earnings of the country.The sector has increased its contribution to India’s GDP from 1.2% in 1998 to 7.5% in 2012.
This phenomenal rise of the IT industry can be attributed to a single decisive policy initiative taken by the Government of India in 1991 by implementing the STPI Scheme.
The AVGC sector similarly also holds a huge promise. The industry started with a major push on outsourcing services in early 2000. Foreign studios have long recognised the Indian talent Pool in this sector. In the period from 2000 to 2008 a number of Indian Companies were working on international project by providing outsourced services in animation, gaming and VFX. Indian animation studios have worked on blockbuster films such as Spiderman, Lord of the Rings, Transformers, X-Men, Men in Black and many more. In the animation space Indian Studios have worked on shows for top channels such as Disney, Cartoon Network and Nickelodeon and offered services on shows such as Playhouse Disney, Tinker Bell, Rat-Man, Iron Man, Wolverine and the X-Men, Swan Princess and many more prestigious global IPs. Games such as Star Wars, Grand Theft Auto, Forza, Need for Speed, Real Steel, Total Recall and many more have been produced using the talent from Indian Gaming studios.
The talent pool in India has been recognised as not just best in Asia but amongst the best in the world. Despite these facts the work in the outsourced sector has steadily declined and moved to countries like Singapore, Malaysia and China. The talent pool in this countries is under developed, less experienced and not as talented. Yet the business has moved to other Asian countries. The hard impact of this was felt by the animation industry when Crest Animation Studios after 15+ years of successfully delivering on numerous international project in July 15th laid off over 250 artist and has almost shutdown.
The questions that needs to be asked are
1.Why have the international studios steadily moved work out of India to these countries.
2.Why are these companies investing in developing talent pools in China, Singapore and Malaysia ?
- Why are they abandoning proven 10 year old production relationships in India and forging new ones in China, Singapore and Malaysia ?
The answer is simple. All these countries are offering a favourable tax structures and production and development funds. They all have created an policy to promote companies in AVGC sector and attract Foreign Investors in this sector.
These incentives are so lucrative that international studios are investing in developing talent pools in Singapore, China and Malaysia. Industrial, Light and Magic, Hollywood’s top VFX studio has opened a studio in Singapore and has launched The Jedi Masters Program (JuMP). It is the most extensive training program ever offered by LucasFilm, exclusively in Singapore. Its goal is to identify talented young artists in Singapore and train them under the mentorship of instructors from Industrial Light & Magic. Media Development Authority(MDA), Singapore has facilitated many such investments in Singapore
According to Deloitte, Singapore’s games and animation industries, together with online/mobile media, have demonstrated robust growth, posting a CAGR of 26% from 2006- 2010. In 2010 it contributed $1.2 billion in Value added Servcies and $1.5 billion revenue to the economy, and employed an estimated 11,000 workers.
- Source EDB, Singapore Website
In 2012, MSC Malaysia revenue came in at RM 33.53 billion which was an increase of 5.7% from 2011, while exports grew to RM 11.6 billion which reflected a 14% rise from the previous year. This resulted in MSC Malaysia’s contribution to Gross Domestic Product (GDP) standing at 11.3 billion, recording a significant double digit growth of 18% from 2011.
- Source Multimedia Development Corporation (MdeC), Malaysia Website
The government needs to learn from our Asian neighbours and nurture and recognise this this sector the way it nurtured the IT sector. Favourable Tax regime is needed to encourage existing companies and also attract new entrepreneurs to enter this sector. We have seen what the STPI scheme has done for the IT industry and the staggering growth the industry has achieved during the years the scheme was active.
We demand that under AM Scheme the following benefits to be given to this sector by continuing the last STPI scheme for ITES sector with a modification of including original IP creation under the scheme :
1.Tax incentives – Exemption from Income-Tax and Service Tax for 10 years
3.Duty-free indigenous procurement
- Deemed export
B.Creation of Doordarshan Kids a Public broadcasting digital terrestrial free to air network:
As we all agree that kid’s are the true building blocks of any nation, while we emerge on the journey of creating “Ek Bharat, Shreshtha Bharat” the development of kids in India needs to be looked at with a more serious approach. And we strongly believe Prasar Bharati can play a pivotal role in the process.
What we demand is an exclusive kid’s channel for Doordarshan with a focus on animated content for kids.
To give you a glimpse of the present scenario, the total Number of Kids’ channels in India is approx 18 including regional languages. It represents around 3 per cent of total available number of channels in India. Viewership share of kids’ genres is 6.3 per cent, much after Hindi GEC, News Channels and Hindi movies.
The key players among kid’s channels in India with a focus on animated content for kids are almost completely endorsing foreign programs. After a decade long push since 1994 when the programming used to be 100 percent foreign content we have reached nearly 30 to 40 percent mark for Indian programming.
One would agree that in the joint family system which existed in India it used to the well known grandparent storytelling and nurturing value system which has been replaced by the foreign kids channels and India has lost its grip over its own value based sanskar system which was unique and India’s own legacy.
Almost all these foreign shows for kids are based on high action and humor. While they are high on entertainment, the shows are pathetically low on educational and moral values leaving virtually no takeaways and positive long term impact on children. Also it is scientifically proved that high action oriented shows tend to develop violent attitude in the young minds. The present foreign animated shows are all about instant gratification and do not encourage any form of intellectual development among the kids. How can we dream of building a strong nation when the Value Systems of today’s Indian kids are being moulded and based on foreign culture as reflected in these shows.
We are looking at complete cultural erosion for future India. Our kids will be unable to understand and appreciate the cultural diversity of India due to erosion of sense of belonging and unable to associate with our cultural roots.
This will also result into death of rich art forms and culture, heritage, mythology which prevailed through centuries, our own history that constitutes the belief of India as a country.
- To promote responsible programming in kid’s channels, specially animated content. Today’s kids are keen to watch animated content over live action in the broadcasting space.
- To provide free access to kids with kids’ programming in cable dark areas
- To emphasize on entertainment with education and vice-versa
- To promote cross fertilization of diversified Indian cultures
- To increase awareness and tolerance to our cultural diversity
- To expose kids to our rich heritage of art, music, mythology and customs
- To instil the right value system
This will enable Indian content to travel global as animation content is universal in nature and travels seamlessly beyond boundaries, cultures, languages etc as compared to live action.
And the best way to do this is to start a DD Kids channel.
Most of the successful countries globally who have promoted kids content in the best manner have followed this process and results for them has been astounding. With its widest reach The Doordarshan’s Kids Channel with the right kind of programming for kids will be able to lead the way and create a path for nation building just as other countries like US, Canada, China have public broadcasting services for nurturing kids and preparing them for future.
The effect will not only get contained with development of kids, but will create a huge splash in the overall development of the animation sector in India as well.
- To promote Indian animation industry to produce more IPs using our rich cultural heritage.
- To generate Indian IPs to create job opportunities and revenue stream for Indian Animation Industry.
- To promote production of locally relevant content.
- To promote employment of rural and tribal youth and artisan who are skilled with local art forms.
- To give the dying Indian art forms a fresh lease of life.
- To provide a healthy alternative to Kids’ channel.
- To set a good standard of kids’ programming in India to be followed by private channels.
With its unmatched penetration in comparison to the cable & satellite channels a DD Kids channel will surely position itself as a differentiator and forerunner. Quality kids’ programming will also generate more viewership and thus attract even more brands for advertisement.
This is probably the only way to strengthen the AVGC industry and bring about sustainability stability and growth to the artist community and other stake holders in the industry. What used to be the cost arbitrage and sometimes the skills arbitrage that attracted services work to India in the past has moved to countries like Singapore, Malaysia, Thailand, China, Indonesia, Hong Kong etc. because of the lack of adequate policies for the AVGC sector in India.
CFSI can operate on the similar lines and manage the fund and act as a de-facto producer of DD Kids contents partnering with the local producers. The programs produced should be translated into regional languages so that it could be aired on the regional channels of Doordarshan as well.
The aim of this initiative should be to educate children with our rich and vibrant culture and expose them to cultural diversity of India along with quality entertainment
- Original content creation fund for CFSI to encourage production in India
- To bring 40 to 50 % of Indigenous created content reservation on all kids networks in India
- Audio Visual co – production treaties with relevant countries
- Use AVGC mode for quality education & training prog
- Skill development by setting up NCoE & empowering Media & Entertainment Skills Council
- Creation of Specialized creative and art cities as well as universities to provide this sector a level playing field
- Creation of a strong Creative- Digital- Content department under the I & B ministry to give a single window clearances, solve and monitor creative, digital & content industry issues.
- Original content creation fund for CFSI to encourage production in India
C.Original content creation fund for CFSI to encourage positioning indian content from India, globally
Intellectual Properties originating out of India can be coproduced/co-funded by Children’s Film Society India (CFSI). CFSI may retain a percentage of revenue shares from the future revenues in perpetuity in proportion to the investment in the IP. This model would eventually fund itself after 5 years from the revenues generated out of the global sales of these animated properties. An expert committee for selection of projects can be set up jointly between the government and domain experts.
The provision of funds needs to be provided for the minimum period of 5 years to 10 years to build a robust foundation of creating original content and registration, protection and exploitation of these IP’s from India. The coproduction fund may be extended to animation, gaming, VFX (films with a minimum of 40% animation and effects) as well as comics industry.
We recommend for a minimum of 5 years a fund of 110 Crores each year. This fund to be divided into 3 separate heads:
1.100 Crores “Co-production” budget which to be awarded to a total of not less or more than 10 projects, with minimum investment being 5 Crores and Maximum 15 Crores coproduction fund. (The modalities can be further fine tuned)
2.5 Crores “Grant” to be awarded to a total of 20 projects @25 Lakhs per project for the development of stories and ideas into a complete developed bible. This will ensure a continuous nurturing and supply of independent creative projects that will eventually fuel the Indian studios with more options to produce.
- 3.5 Crores “Marketing” budget to manage, administer and run events and processes around the Co-Production Funds & Grants.
This will help the industry immensely and in the next 5 years India can boast of over 100 successfully implemented coproduction’s and shows, which will be extremely strong original intellectual property out of India, one of the strongest libraries establishing and restoring forms of art, culture and creative styles and designs which will be known throughout the globe. India would emerge a true, leader in the digital content economy and it will ensure jobs for over 4-5 Lakh creative, techno creative and artistic youth of the country in the next 5-7 years.
CFSI can recover this investment from the following sources:
- By keeping Doordarshan (Public broadcasting rights in India) & worldwide terrestrial rights for all these properties.
- By keeping Doordarshan (Public broadcasting rights in India) & a percentage share of all the worldwide satellite broadcasting, Licensing & Merchandising, etc.
This will not only strengthen the cause of CFSI but will give a big boost to creative artists and creative & animation studios in India. Moreover this will help restore the art and culture of India in a significant way.
- To bring 50 to 60 % of Indigenous created content reservation on all kids networks in India
India is the third largest TV market in the world with a total strength of 161 million TV households only next to China and the USA. The TV industry is the most important industry in Media & Entertainment Sector and contributes the largest share to the entire M& E Industry of India. With a 6.3 percent share in the kid’s entertainment space, it caters to a huge audience base in the country.
This audience is also the future of the country, our kids who deserves the right environment for nurturing and growth. In a scenario where American programs constitute 25%, Japanese programs 35%, Korean programs 35% and Indian programs a miniscule 5% in the Indian broadcasting space for kids, how can we dream of building a strong nation when the Value Systems of today’s Indian kids are being moulded and based on foreign culture as reflected in these shows.
Also from an industry perspective, with few possible exceptions, Animation, Gaming & VFX are the only industries where demand for manpower is more than supply. It is estimated that India has about 300 animation, 40 VFX and 35 game development Studios employing thousands of technocreative professionals.
If the I&B Ministry can take measures and formulate policies in the right direction for kid’s content on television:
The kids in our country will get a healthy environment of education as well as entertainment. Since the grandparent storytelling of heritage and culture has been replaced by television today, its important that the correct content is given to the kids.
It will promote India culture and rich heritage thru present days story telling digital mediums.
It can also meet Government’s objective of employment generation in the creative and artistic sector which has been neglected for a long time.
To give a great boost to the studio’s and skills in India to retain work and creative jobs in India.
To effectively reach out to all the rural audience with even educational content in an entertaining way in multiple languages.
To effectively implement creative content reservation the co-production treaties and CFSI funding would bring about a conducive environment and build a win-win proposition for all stakeholders.
30 % mandatory local animation content on the networks to begin with and to reach 60 % over next three years as more indigenous animation content gets prepared and available for domestic/ exports markets.
According to CASBA Korea has mandatory local content programming quota for movie channels are 30 % and for animation channels it is 35 %. In Australia Free-to-air channels must make sure 55% of content broadcast between 6am and midnight. This quota includes mandatory levels of first-run drama and children’s content.
Most Of the Asia’s animation since 1960 has been tied to foreign interest attracted by stable and inexpensive labour supplies. For nearly 40 years, western studios have established and maintained production facilities, first in Japan, then South Korea, Taiwan, Philippines, Malaysia, Singapore and INDIA. The economies of the industry made it feasible for Asia to feed the cartoon world, to the extent, that today 90 % of all “American” television content in produced in Asia. Asian animation companies bid fiercely for the part of the global business, insisting that it provides employment to the skills to young people, brings in needed foreign capital and to the creation of domestic animation. Countries like Korea, China, and Singapore have enjoyed Government support for promoting this sector. Asian competitors like Korea, China, Japan, Philippines receive tremendous support from their Government in terms of finance and infrastructure. Most of these countries have a programming quota of local animated content for their kid’s channels which helps them to grow as content creation nations and restore their country’s culture and heritage for their kids while they also excel as animation outsourcing nations.
The level of local content requirement imposed on a sector (such as free-to-air television and pay television) is supposed to be pegged to that sector’s influence on community views, as well as its ability to withstand compliance costs.
It is utterly essential that such quota of locally created content to be broadcasted on kid’s channels in our country be imposed if we want to stop complete cultural erosion for future India. Our kids will be unable to understand and appreciate the cultural diversity of India due to erosion of sense of belonging and unable to associate with our cultural roots. Such quota in kid’s channels will help in:
- To promote responsible programming in kid’s channels, specially animated content. Today’s kids are keener to watch animated content over live action in the broadcasting space.
- To provide free access to kids with kids’ programming in cable dark areas.
- To emphasize on entertainment with education and vice-versa.
- To promote cross fertilization of diversified Indian cultures.
- To increase awareness and tolerance to our cultural diversity.
- To expose kids to our rich heritage of art, music, mythology and customs.
- To instil the right value system.
Also, it will give boost to our animation industry and create massive job opportunity. We will also have a substantial library of Indian animated content that can travel globally and spread awareness of Indian culture and heritage.
1.Audio Visual co – production treaties with relevant countries
As India does not have a co-production treaty with major animation producing countries, we are not even considered for large production deals. This is a major blow to the outsourcing industry. This is despite the fact that we have an excellent talent pool. Countries like China which has very low skill animation talent Pool as compared to India has drawn in major production deals from US Broadcaster Nickelodeon as the Chinese Government has made significant investments and are heavily subsidising these American productions.
As India has signed co-production treaty with Canada this year, we need to sign coproduction deals with Belgium, Finland and other European Nations. Co-production treaties also need to be signed with Asian Countries such as Singapore, Korea, Japan and China. All treaties should cover animation, visual effects, gaming, film, TV and comics. Most of our existing treaties with countries such as UK are limited to film, these need to be extended to cover the full gamut of Film, TV, Gaming and Comics.
It is recommended that the co-production treaties should be signed between the Government of India and the following countries:
Also, many feel Gaming should be included in the already signed co-production treaties like Canada, Italy, Germany, Brazil, France, New Zealand, and Poland as gaming is an integral part of the entertainment industry and important component of AVGC Industry.
As co-production treaties have become an important instrument for the countries to access global markets and knowhow, these co-production treaties would be helpful to the AVGC Industry.
- Creation of Specialized creative and art cities as well as universities to provide this sector a level playing field:
These specialized creative and art cities will provide a complete ecosystem from education to production and as the majority of the industry is on self employment, this will enable most of the creative artists and performing artists to earn their livelihood and maintain a work-life balance in these cities which are created at various places of India.
- Creation of a strong Creative- Digital-Content department under the I & B ministry to give a single window clearances, solve and monitor creative, digital & content industry issues as well as a single point entity for all co-production treaties:
The Culture Department while playing its part has the potential to operate on a much larger scale. We recommend that the Culture Ministry be included within the I&B Ministry and be renamed as Creative- Content-Culture-Heritage Department at the central and also at the state governments levels. The Films, TV, Animation, Radio, Online & Mobile and all forms of content creation must be brought under this department. This will bring focus in these areas in terms of long term vision and effective policies that will enable the entertainment industry of India to flourish in the right path.
This will not only create creative and artistic vision but also restore our golden heritage. The department while looking at the culture of the country also needs to understand that entertainment is also a part of culture itself, and more so in today’s time since both nationally and globally it’s the entertainment and educational content in various platform that represents and mirrors the culture of a country.
Hence the responsibility of creating the platform and a total ecosystem for creating healthy content needs to be promoted by the Creative-Content-Culture-Heritage Department under the I & B Ministry.
In the era of technology social media and the consumption patterns of today the digital content creation economy is booming. Majority of the countries in Asia Pacific have aligned their policies and initiatives to support the digital content creation industry while enforcing the ethos and safeguarding the cultural fabric of their countries where by enabling a conducive environment of modality culture and technology.
We must grab the opportunity to remodel and relook into the content creation including films & entertainment space and give a facelift to the Culture Ministry, empowering it with the new proposed identity by including it the I&B Ministry. This will not only ensure the focus that is duly required to be given to the content creation for films, television , gaming, animation, comics , even digital consumption but will also enable us to re-position and give a true industry status to the creative content creation as an industry.
India will be then better poised to get into the co-production treaties and many new age partnerships with all the international stake holders from around the world.
A special attention can be then given to restore all the dying art, folk and performing art forms from India. To bring special focus on museums, theme parts, history and heritage parks etc to promote our tourism. It will make region specific cultural and art find rebirth.
The formation of Creative-Content-Digital ministry and establishing its close working or working under the I & B ministry will be a landmark step in the India history and enable restoration and re-positioning effort of India ethos and values.
- CSR funding for kids programming
A nation’s culture resides in the hearts and in the soul of its people just as the strength of a nation derives from the integrity of the home. And in every home should reside the core values of patriotism since it is an indispensable weapon in the defense of our country.
A nation is secure when its youth are honest, truthful and virtuous. And television being today’s grandparents of the society, telling stories to the kids as they grow up must bear a social responsibility as well while creating entertainment.
It makes children programming for television that much more a responsible job. It is their window of imagination, their medium of character building, their source of inspiration. And in this noble cause a lot more than just the network’s support is needed to make the children programming space more viable and vibrant.
But even great causes needs legitimate support. And that support of providing the children programming space its exposure, reach and exploration in terms of recourses will only be possible if Corporate India takes a step forward and recognizes children programming as part of their Corporate Social Responsibility (CSR) initiatives.
But just the way constitution is needed to make us abide by fundamental guidelines of law even though we are aware of it, similarly for such an initiative though the corporate are aware of its importance, needs a legal initiative from Government to provide a legitimate platform that it deserves.
An approval from the Ministry of Corporate Affairs towards classifying “Children Programming” officially eligible for Corporate Social Responsibility (CSR) funding will provide the much needed stimulus in this endeavor.
Creating sensible and responsible children programming in India is a social revolution of bringing back the pride for our country to every youngster across the nation. It is an effort to instill our roots in them so that we create socially responsible citizens, and the process starts when they are young. What can be a more “appropriate” reason to seek the enormous resource that Corporate India can provide through CSR towards supporting Children Programming.
There is no nation so powerful, as the one that obeys its laws not from principals of fear or reason, but from passion. At the same time we need to help students and parents cherish and preserve the ethnic and cultural diversity that nourishes and strengthens this community – and this nation.
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