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the group has floated Kids Media India (KMI).   „  „ Indiantelevision. The shareholding has also been restructured with Japanese firm Animation International holding 51 per cent stake in KMI. has put the company on a totally different pedestal.    „ A licensing and merchandising deal with Emerging Media. Spacetoon Kids TV. will evolve as the prime property and will guzzle over 50 per cent of the company's Rs 1 billion investment plan. Kids Animation India is the other arm that will look after the publishing activities. Dubai-based Spacetoon Media Group holds the remaining with a small stake as sweat equity resting with Spacetoon India managing director and CEO Rajiv Sangari. a company that will take care of the TV and licensing business.com's       „ . In India. Talks are also on with a few other sporting goliaths to expand the L&M portfolio. however. owner of the IPL winning team Rajasthan Royals.

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"  . As the Indian economy and the TV industry went on a zoom and prices skyrocketed. With distribution. we have spent a long time testing the market. Despite an overall bleak scenario and a tough advertising market. it would have made no business sense to launch a kids channel. Frankly. marketing and all kinds of operational spends going beserk as Hindi general entertainment channels got launched. launching at this moment definitely makes more business sense. „         ! Since the germination of the idea way back in 2004-end. we had to rethink our strategies as we were going to occupy a niche space. Now the prices have corrected and things are much more in control. it would have been a business hara-kiri.

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rather than sharing our passion. But most of them wanted to basically take advantage of the position of our fund raising. I would term this as strategic restructuring.$  $    % &  '(  )* +   ! Both Spacetoon and AI have relations since the last 25 years and they have been partnering and co-operating with each other on many businesses together. Most of the East and South East Asian operations. while most of the Western Asian. changing of the hands in shareholding doesn't have much to do with any kind of interest level subsiding or increasing. Hence. This did not go with our strategy for . Either they wanted majority stake or at some point they wanted us to exit. for example. European and Eastern European operations will come directly under Spacetoon. It is a strategic move by both partners of re-strategising and restructuring their operations amongst themselves.        $ +   ! Spacetoon was in talks with a few players and we had already determined 3-4 of them at various stages of our discussions. will be monitored by AI.

We require a partner who thinks and aligns with us for long term. But if we get an extra push in terms of a partner who can value our strength. we are equipped as of now to handle it on our own. India's economy and retail can only grow and we have 360 million kids. Though we realise that for taking our verticals to the next level we require some support. experience and hard work which has gone behind making the company and the brand what it is today. we will definitely look at the possibility.India. : .

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$       ! We plan to invest Rs 1 billion over three years. For over a period of 3 years now. It's always the ancillary units like merchandising. Unlike general entertainment channels. We have done the tough job of laying out a platform for licensing and merchandising. =)    $"/   +  $       . We are doing the same thing here.'   $     $ ! We need to realise that kids business is not driven completely by TV broadcasting. about 50 per cent upwards will be consumed by the TV operations. Out of this.         ! That is the business model Spacetoon has followed in other markets. other than TV launch. We are glad that we did not divest then. ad revenue is important but not the only source of income in the kids genre. we have successfully launched our licensing. publishing and merchandising divisions and are very soon launching our own IP programmes. And TV business is a long term game. etc. publishing. which will help it take to the next level. )*              -. . the time has come for us to scale up the verticals. After the launch of the kids channel.

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+. the market today doesn't allow us or anyone to do so. "   +. And. you just can't support such a large distribution budget.  $     + ! Haven't others too? It's simple.        . $  "/    :". I hear from some sources that most of the top to small TV channels have slashed down their distribution disbursements. especially in kids genre.

we should be touching 25 million homes. We realise it will take minumum 3-4 months before we start getting visible across all markets.   )"/ 2  0      3 $    +. it's only four weeks since we launched. our estimates are that we have penetrated over 10 million homes and we expect to do over 15 million by the middle of this year. By year-end.  $ ! Our focus is not only to tap the Tam cities but also other markets. We have also signed up other cable operators. particularly for their digital viewers.   .    *1 :". As far as cable goes. we are available in some Hathway Cable & Datacom networks. Distribution is a gradual build-up. don't forget. As of today.  ! We are in talks with the direct-to-home operators. And.

programming methodologies. . Our channel will be focusing a lot on moral and social values. and formats.    $ ! Each one of us has a different style. packaged with lots of entertainment content.

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Unlike running half-hour episodes back to back. This will ensure a different look during the whole day. promos. There will be fillers which are moral based. we will be giving the kids a mix of several things. etc.       ! Spacetoon will divide the day into 10 planets. messages. :       . ads. packaging.

 $$ $0! We definitely are looking towards creating localised programming very soon.   $     . This will be mostly live action-based programming. There are discussions going on with various producers to this effect.

We realise that if we have to tap the minds of the kids.     2       $ . We will also be having events from April onwards in high public areas like malls. We are creating a very good value-based school-contact programme. there is no better place than their learning ground - school.   ! We will be creating a touch base by tapping thousands of schools in India. a key area where most of our energy is going to be focused in the first year.

It will take us some time to penetrate the market and grab space in the minds of the kids. As for TV revenue. Nobody can predict the forthcoming financials in today's market.      ! I would not want to put across numbers now. But our major revenue driver will be merchandising. Following that are our publishing and licensing activities.  0    $ . we are expecting it to start from the later part of the year. which is in full throttle.

These are translating into products that will get into the market during the course of this year. We already represent some top companies in the world for licensing and there are few more coming our way in the next few .    $   ! We have tapped over 69 licensees in the last 14 months.

months to make our portfolio more robust and meaningful. we are channelising all our resources towards this. We have already worked out our strategies to tap the right licensees who will be able to add value to this fantastic brand on the ground level through merchandising. Since the time is very short. But now with Hello Kitty and Garfield coming our way. especially big international clubs. We have a three-year deal with Emerging Media and are targeting Rs 200 million of retail business in the first year. We hope to stitch deals with some of them soon. . We observed that our portfolio was tilted more towards the boy category.   . We are also in discussions with few more goliaths from other sports.2 . ! We are in hot pursuit to come out with products before the first week of April when the IPL kicks off. I think we have one of the best characters in the girls genre.

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