Star India CEO Peter Mukherjea has said corporate rivals are trying to scuttle the company's fledgling news channel.
"When we launched our channel we anticipated a fair degree of impact on the viewership of competing news channels. It is, therefore, no surprise to see corporate rivalry manifesting itself in this manner," Mukherjea said, adding that Star News had wrested marketshare from its key rivals.
He said Star would find a replacement for Kumar Mangalam Birla, who had conveyed his desire to pull out from Media Content and Communications Services, the Star affiliate company that would uplink for Star News.
"As we understand, he (Birla) wants to exit. But the company's equity structure will continue with the stipulated 76 per cent Indian stake, and a replacement will be found in due course," Mukherjea explained.
Star argues that even if Birla does pull out, MCCS will not have to apply for fresh permission to broadcast as long as 76 per cent of the stake is in the hands of Indian shareholders.
Reacting to the charge that MCCS had an equity capital of only Rs 4 crore (Rs 40 million), Mukherjea said Star News did not need a larger equity base because it was already in existence and had an assured revenue stream.
"Star News was already in existence, and advertisements were the primary source of revenue when NDTV was producing its programmes. Even today, advertising and sponsorships continue to be the only source of revenue. The revenue stream stands expanded because now we are a 100 per cent Hindi channel. And it is this revenue which will fund the channel's operations."
When asked about what Star News' strategy would be if the policy was changed and the government pushed for an Indian entity to become the single-largest shareholder, Mukherjea said, "If the guidelines change, we will comply accordingly."
Mukherjea also clarified that the Star TV logo and name, which consumers recognised easily, had been leased out to MCCS by Star TV in Hong Kong.
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