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From Booze To News

Liquor baron Vijay Mallya is all set to cruise the infobahn

From Booze To News
The badshah of booze, Vijay Mallya, is vroom-vrooming his way on to the information superhighway. Satellite television, cable networks, hardware, software, newspapers, Internet, e-mail—the UB Group chief is getting into them all. Or so he says.

Admittedly, anything Mallya does that doesn't have alcohol in it should be taken with a bowl of salted wafers. The liquor lord is long on spirit, short on performance outside his inherited turf. But recent reports of his media forays are too many and too frequent to be ignored.

In the first week of December, UB was chosen by the Karnataka Government to set up a cable TV network in association with United International Holdings (UIH) of the US. UIH India Inc, which has a 51:49 joint venture with UB, will pump in $75 million (approximately Rs 250 crore) to transmit voice, image and data initially in Bangalore, Mysore and Mangalore, and later in the rest of the state.

  • On December 18, when Mallya turned 40, the group acquired 100 per cent control of the Madras-based satellite TV channel GEC (Golden Eagle Communications) run by Tamil Nadu liquor baron N.P.V. Ramaswamy Udayar. Mallya's immediate aim is to make GEC the number one Tamil channel, take it to Karnataka later, and make optimum use of the uplinking facilities the channel has at its disposal in Singapore.

  • On the same day, in Bombay, UB entered a strategic alliance with Russy Karanjia's Blitz by buying an 8 per cent stake in the group which can be increased to 27 per cent in the long run. More editions, including regional ones, possibly a Tamil one to start with, are planned along with a revamp and relaunch. The details will be revealed on December 27.

  • And there are rumours that Mallya is planning a tie-up with the US-based company WorldTel which has secured the telecast rights for the 1996 Cricket World Cup. Mallya and Mark Mascarenhas have been seeing a lot of each other lately, and a formal announcement "to do stuff together" might come before the game's quadrennial show gets on road.

Clearly, UB's "Chairman for Life" has identified information-related businesses and the media as a key focus and growth area. A new division, UB Communications, has been formed for the purpose, with press reports hinting at investments of around Rs 500 crore.

Mallya had been eyeing television for some time. He bid for the 24-hour Hindi music channel ATN and JAIN Television early this year, but withdrew after he ran into undisclosed bottlenecks, chief among them reportedly being their owners' refusal to part with them lock, stock and channel.

With GEC now in his charge, Mallya plans to go full steam ahead. He has plans to set up a Rs 10 crore state-of-the-art studio in Bangalore which, he feels, will mesh well with his cable networking plans.

Mallya, of course, isn't the first badshah of booze to try and become a media maharaja:

  • In Karnataka, the proprietors of the leading English daily, Deccan Herald, are erstwhile arrack makers.

  • In Tamil Nadu, Ramaswamy Udayar, who sold the GEC channel to Mallya, is Mohan Meakins' licensee.

  •  In Andhra Pradesh, Mallya's franchisee, Lok Sabha member Magunti Subbarami Reddy, owned the Udayam Telugu daily and was about to launch an English newspaper called The Guardian before he was killed in November.

But Mallya is thinking multimedia, though few—including some of his drinking buddies—are optimistic that he will make a go of it. Says one: "Each unrelated diversification of Mallya—telecom, aviation, petrochemicals, fertilisers, engineering—has boomeranged. When that happens, he goes back to core consolidation which is liquor, makes some money, and starts afresh. He's a sport."

Sport is probably where Mallya's sights are set for the moment. He loves horse and motor racing, plays squash regularly on a court in his residence, runs Asia's biggest stud farm at Kunigal, is president of the Indian Automotive Federation, is a government nominee on the Bangalore Turf Club, and wants to take over the government-owned Kanteerava Stadium in his hometown.

With the World Cup round the corner, talking to Mascarenhas, who like him is a Mangalorean brought up in Bangalore, might help. "Look what he has done for horseracing," says a Mallya confidant. "That's what he will do for cricket with television. He will be good for the sport."

The sceptics—and there are dozens—may ask: "'What is this morbid fascination of big industrialists to get into the media?" Mallya is probably looking at it long term. The UB group has a huge adspend ("enough to sustain a TV channel," says a UB source, meaning upwards of Rs 10 crore a year) but advertising alcohol is banned in India. Which means a lot of the money earmarked for brand promotion goes unspent. Surrogate advertising is the only avenue open—UB sponsors the West Indies cricket team and sailing rallies. Owning a TV channel and a newspaper, howsoever small and insignificant, might make sense although immediate returns are impossible. "We can not only utilise our adspend usefully but have something against our name in the end," says a senior UB executive.

It will also probably help boost the chairman's ego. "When a man has three days of parties when he turns 40, he obviously loves to project himself," says a source. Will it work? Wait and watch.


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