Revisiting Rupert Murdoch's India adventure as he hangs up his boots

Once he arrived on the scene in a rapidly liberalising India, there was no stopping him. The country's private broadcasting story begins with the Murdoch-Subhash Chandra team

Rupert Murdoch fixated on the man in the brick-red kurta. “What do you do?” asked the (then) 63-year-old chairman of News Corporation that owned Star TV. “I told him I was tasked with the Indianisation of Star,” says Rakesh Sharma, then head of Star Plus and now an acclaimed documentary filmmaker.

This was in late 1995, soon after Channel [V]’s success. India was becoming important and the meeting in Hong Kong was designed to ‘educate’ the Murdochs and a bunch of New York bean counters. Sharma’s proud display of ‘Indian formals’ in a roomful of suits got Murdoch’s attention.

For over two hours he grilled Sharma about politics, government, agrarian banks, rural India, the country’s first experiments with satellite television in the mid-seventies and community TV, among a host of things. Could Star be installing community TVs in B and C class towns with 100,000-plus population? “We were tossing ideas on distribution. He was interested in knowing things that could help him expand and get in before the competition did,” says Sharma.

India then had just 52 million TV sets that reached about 200 million people who (largely) watched Doordarshan. The business generated Rs 3,000 crore in pay and advertising revenues. So, talk of seeding TVs in small-town and rural India to sell channels and programming seemed a bit far-fetched. But “Rupert looks at business in long cycles. ‘Don’t look at 10-year timeframes; look at 30,’ he says,” shares Uday Shankar, former CEO, Star India.

Not surprisingly, Murdoch, along with Zee’s Subhash Chandra, played evangelist, investor and proponent of the Indian economy’s consumer power in a bid to create a broadcasting business. They succeeded.

There are now over 210 million TV sets in India reaching 892 million people. At close to Rs 71,000 crore in revenues in 2022, television brings in the largest chunk of the country’s Rs 2.1 trillion media and entertainment business. The announcement that Murdoch will be stepping down as chairman of News Corporation and Fox shines a spotlight on what this 92-year-old meant to the world of media.

The house that Murdoch built

Globally, Murdoch is synonymous with news media. He is also its most reviled character. In his bid to make a global media company out of the single newspaper he inherited in Australia, Murdoch has ridden roughshod over regulators, politicians and rivals. The damage his news brands such as Fox News, The Sun and Sky News have done to discourse and democracy is well documented. That is how most of the Western media identifies him. But the fact remains that in India, Murdoch has been a force for good.

In the eighties, he bet on satellite television. By 1991, he had almost lost News Corp to the debt that piled up on the way to creating BSkyB. Just when the firm was limping back, he blew up over $870 million on Star TV, the first and only pan-Asian broadcaster then.

It took nine years, but when Star succeeded, News Corporation was the first global firm to showcase the potential of the Indian media market to the world. This acted as a catalyst for many million dollars worth of investment into Indian media. A hundred investor summits could not have done what Murdoch’s faith in the consumer power of this economy did. More importantly, he localised (read completely Indianised) the management, thinking programming and the very DNA of Star long before ‘going local’ was a popular word.  

In the process, Star brought many things: Channel [V], India’s first music channel in 1994; Star News, its first news channel in 1998; Radio City, the first private radio station in 2001. It revived an ancient Indian game through the Pro Kabaddi League; created India’s largest pay streaming app with Disney+Hotstar; helped Amitabh Bachchan’s return to stardom through Kaun Banega Crorepati (KBC) in 2000; and changed the rules of television for good.

Thirty years down the line, it continues to dominate, with a 23 per cent share of all TV viewing. At over Rs 17,000 crore in revenues (now), Disney Star is among the largest media firms in India. In 2018, when Disney bought out Fox’s entertainment assets, the India business was valued at $13-15 billion.

Murdoch’s marriages and divorces

“What is your vision for broadcasting in India?” Murdoch asked former director general of Doordarshan, Rathikant Basu, when they first met at the Grand Hyatt in Delhi in 1996. “I told him that direct-to-home (DTH) is the future,” says Basu.

A longish discussion on the merits of the technology and India’s internecine cable wars followed. But even while he listened (and talked) Murdoch kept going in and out of the room to make calls. At one point, he asked Basu what DTH would cost. “My estimate was $500 million,” says Basu. After about four hours Murdoch said, “Mr Basu, $500 million has been transferred to the Star account in Mumbai and we have booked (seven transponders) on PanAmSat’s PAS4. Would you join me?”

Basu continued to be amazed at the speed of Murdoch’s decision making and the freedom he offered even after he became CEO. It is a point that every successive CEO brings up.

When Murdoch arrived on the scene, a rapidly liberalising India was trying to shed its natural suspicion of foreigners. But unlike Sony, Turner or Viacom, Murdoch’s presence was a cause for consternation. Unlike the others, he owned news brands and had a reputation to boot. None of the others got the negative press that Star received, almost on a regular basis through the nineties.

It was against this backdrop that Basu hired some senior people from Doordarshan over 1996 and 1997, creating further resentment within the corridors of power. In March 1997, Basu was to hold a press conference to demonstrate IskyB, a DTH service. A slew of full-page ads announcing this raised regulatory hackles. Just a day before the demo, the information and broadcasting minister CM Ibrahim announced that there was no question of DTH services being allowed until the broadcasting Bill was passed. Star had to write off hundreds of millions of dollars to this fiasco (but it held steady and finally launched Tata-Sky in 2006). By 1999, Basu was replaced with Peter Mukerjea, then head of ad sales.

In 2000, nine years after it entered India, Star was nowhere. It had a news channel programmed by NDTV, a sports channel in a joint venture (ESPN-Star Sports) and an entertainment channel that was a distant number three to Zee and Sony. After sinking millions of dollars, it didn’t have a DTH business or any distribution assets in one of the fastest-growing TV markets in the world. This, after having been one of the first to enter the market. But Murdoch held firm. Soon after the Star-Zee divorce came KBC .

Murdoch insisted on changing the prize money from a lakh to a crore. He reckoned that the team had to think big if the show was to have an impact. He was right. KBC gave Star the break it was looking for. There was no looking back after that.

Some parts of this article have been drawn from the writer’s book, The Making of Star India (2019), Penguin-Random House