MD Entertainment's Indonesian Manoj Dhamoo Punjabi seeks growth by buying small TV stations

Billionaire film producers once dismissed free TV as a sunset industry but are still excited about its prospects.

IIndonesian billionaire film producer manoj punjabi It sounds like he is not optimistic about the local free-to-air TV channel he recently acquired, which has a paltry 1.4% audience share and has been losing money for years. “Honestly, I’m buying a sinking ship,” the CEO of MD Entertainment said in an interview at his plush Jakarta office in October, just hours after signing a deal to acquire a majority stake in the station’s parent company back. He once considered free-to-air TV a “sunset industry” as viewers around the world turned to streaming platforms such as Netflix, and to top it off, he acquired one of the industry’s weakest players in Indonesia.

But the 52-year-old does not regret his decision to spend 1.65 trillion rupees ($105 million) to buy an 80% stake in Jakarta-based Net Visi Media (now known as MDTV Media Technologies), which operates NET. through subsidiary television channels. “If I could turn it around, that would be an extraordinary sense of satisfaction,” he said.

Punjabis know how to satisfy the audience of Indonesian entertainment industry. A horror movie he produced and released in 2022, KKN Disa Penari “The Curse of Dancing Village” (KKN, “The Curse of Dancing Village”) set a record in Indonesia, attracting 10 million theatergoers, making it the company’s highest-grossing film, boosting sales that have been hit hard by Covid-19 restrictions. Theater revenue.

His plan is simple. MD Entertainment already has over 14,000 hours of company-owned content. According to Nielsen Media Indonesia, through NET., he gains another distribution platform that can reach the nearly 100 million Indonesians who watch free-to-air television. Some places in Indonesia’s vast archipelago of more than 17,000 islands don’t have movie theaters or the Internet, but they can receive television signals.

The move is also aimed at strengthening the company’s content creation capabilities, giving it another medium to produce content and integrating it with programming produced by cinemas, digital TV and OTT services. As Punjabis see it, NET. is a game changer. “TV is a small thing now. But TV may account for 50% to 70% [of total revenue]and the movie explains the rest. That doesn’t mean movie revenue is down, but TV revenue is starting to come in. That’s my plan,” he said.

In 2012, Punjabis first acquired a TV station but could not reach a deal. For a while, he gave up on that pursuit, deciding that free television might not be a viable way to expand the business. Then the opportunity arose to acquire Net Visi Media, which is owned by two companies controlled by Agus Lasmono, whose late father Sudwikatmono, a cousin of Indonesia’s second president Suharto, dominated the film industry for years.

Reel results

Currently, movies account for nearly 75% of MD Entertainment’s revenue.

“Television probably accounts for 50 to 70 percent [of total revenue]and the movie explains the rest.

Indonesia’s free TV advertising revenue comes mainly from manufacturers of consumer goods such as shampoo, soda and snacks, which are eager to attract large audiences. In 2023, the total advertising revenue of Indonesia’s listed television broadcasters will be approximately 15 trillion rupiah ($1 billion). For MD Entertainment, this market has been largely untapped so far. “[NET.] It was my stepping stone to the big universe I created for MD,” Punjabi said. What follows is the hard work of realizing his strategy, and even as he attempts to do so, he will have to contend with new rivals as well as long-time rivals that have stepped up their alliances with partners with deep pockets.

clearer picture

In 2023, Net Visi Media’s revenue will be a fraction of publicly traded rivals.

FFilm production is a family business. Punjabi is the only son of Dhamoo Punjabi, who, together with his brothers Gobind and Ram and a fourth partner, founded a company called Panorama Film in the 1960s to import films to Indonesia and then produce them. In 1989 they started selling television shows and a year later launched Tripar Multivision Plus (better known as MVP) to produce Indonesian soap operas called sine tube, It quickly found a home among new private television stations hungry for content.

Manoj Punjabi has always loved movies. He started collecting movie posters at the age of 7 and became an avid movie fan by the age of 10, going to his father’s office to watch movies after school until “when my dad asked me to come home and do my homework.” Stop, he said. “Ever since I was little I wanted to be a filmmaker.”

Things didn’t happen as quickly as he’d hoped. In 1993, the Punjabi earned a bachelor’s degree in marketing and finance but was forced to find a job outside the film industry, which had been hit hard by the recession. He found a job with a pulp and paper company, but it didn’t excite him, and when his three-month trial period ended, the company said his services were no longer needed. Next, he worked with a partner in an apparel business, overseeing factory operations and marketing. But he didn’t stay long, seizing the opportunity to join the MVP team in 1995.

Punjabi said he had no privileges or priorities as a family member. He didn’t initially start helping produce content right away, but was assigned to sell content produced by the company sine tube Producing in the laserdisc format didn’t make much money, but it paved the way for him to eventually become a production manager.

In 2002, seven years after winning MVP, differences arose among family members. Punjabi and his father sold their shares and used the proceeds as seed capital to start a rival company called MD Media (the predecessor of MD Entertainment), in which Punjabi’s wife Shania and mother Sunita were involved. Members of the Punjabi family, the company owned by both branches, are still competing.

MD began producing soap operas, which by then had become a staple of Indonesian television, and sold its first series to the Indosiar channel in 2003. Kara (Dead Time), but it failed to thrill audiences, attracting only 70,000 viewers. MD released a film about polygamy in 2008, Ayat-Ayat Sinta (Poetry of Love) is a turning point. Attracted 3.7 million viewers, more than the number of people who went to see a Hollywood blockbuster Titanic in Indonesia. Notably, this proves to Punjabis that Indonesian films can compete with global hits if they tell a good story and are of high production quality.

Hollywood movies have long dominated the box office. The chances of success in attracting large audiences are slim, and fierce competition and low ticket prices (about 15,000 rupiah or $1 per ticket) deter Indonesian film producers. In 2015, when MD Entertainment secured the country’s single highest-grossing film, Surja Yang Tak Dilindukan (“No Miss in Paradise”), only about 15% of Indonesian movie audiences watch locally produced movies.

“Ever since I was little I wanted to be a filmmaker.”

Audience numbers began to gradually increase, and by 2019, 35% of cinema audiences were watching Indonesian-produced films. That share soared to nearly 60% in 2022, when the Punjabi horror film attracted record audiences, and in the first 10 months of 2024, according to data research firm Cinepoint A whopping 67%, with MD Entertainment holding the largest share with 21% of the total number of viewers watching its movies.

Competition among filmmakers is sure to intensify. In September, Media Nusantara Citra, owned by billionaire media tycoon Hary Tanoesoedibjo (who owns one of the highest-rated free-to-air radio stations, MNC TV), bought a 9% stake in MVP, forming an alliance with one of the country’s largest and most aggressive media outlets. Uncle Punjabi’s Company. Subsequently, rival Verona Indah Pictures raised Rs 34,000 crore through an IPO in October, providing it with significant resources to strengthen the production of television content and launch a film production unit.

shadow king

MD Entertainment has dominated Indonesian cinema and now dominates the country’s entertainment landscape.

Despite the challenges facing Punjab, he retains the trust of Miming Satyono, president of Samuel International Investments, which helped finance the acquisition of Net Visi Media and currently owns 1.7% of MD Entertainment. Punjabis “are very passionate, very dedicated,” she said. “I joined him because I saw his business was doing well and he was not a typical hit-and-run investor.” Samuel Sekuritas Indonesia analyst Farras Farhan predicts MD Entertainment’s 2024 revenue is expected to reach 4,900 Billion rupees, revenue is expected to more than double to 99,000 rupees by 2025, calling Net Visi Media an attractive acquisition that would give MD Entertainment an opportunity to tap into the lucrative OTT business.

Punjab had its own powerful allies to help him achieve his goals. Chinese tech giant Tencent Holdings acquired nearly 15% of MD Entertainment in 2021, three years after the company became the first film producer to list on the Indonesian stock exchange in 2018 (Tencent has since reduced its stake to to 11.5%). Meanwhile, Punjab’s stake in the company is the main source of his estimated net worth of $1.5 billion, ranking him 34th on this year’s list of Indonesia’s 50 richest people.

One of the first tasks of the newly renamed MDTV Media Technologies is to consolidate profits. In 2023, the company posted a net loss of 630 billion rupees, on top of a loss of 181 billion rupees the previous year. NH Korindo Sekuritas Indonesia chief economist Ezaridho Ibnutama said in a briefing that NET.’s operations “have been restructured or reformatted to become more radical, [MD Entertainment’s] Revenue will grow near double digits in 2026. In Ibnutama’s opinion, put the content of MD on NET. This will make it more competitive and increase its audience and advertising revenue “as MD’s content is designed to cater to local entertainment preferences.”

Punjabis are still personally involved in the creative process. He prefers to hear an elevator pitch for new content kept under two minutes rather than wading through an entire script. He also hopes to focus Indonesians’ attention on local cuisine rather than being attracted by Hollywood-produced blockbusters.

“There is a saying that content is king,” Punjabi pointed out. “What’s the point of content being king if we don’t have our own kingdom? Now I have my own kingdom.