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TV moguls in spat over deal
Indonesians, the most ardent viewers of soap operas in Southeast Asia, are enjoying a real-life drama unfold involving a rivalry between two of the country’s largest television moguls
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ndonesians, the most ardent viewers of soap operas in Southeast Asia, are enjoying a real-life drama unfold involving a rivalry between two of the country’s largest television moguls.
The dispute has heated up since the purchase of a share holding in leading production house PT Sinemart Indonesia Entertainment Group was legally annulled.
TV channel Surya Citra Televisi (SCTV), a subsidiary of PT Surya Citra Media (SCMA) owned by Eddy Sariaatmadja, saw an 11.7 percent increase in prime-time viewer figures to 24.7 percent in March, as Sinemart’s soap operas — known as sinetron among Indonesians — had been screened since February.
The group, through its subsidiary PT Indonesia Entertainment Group (IEG), spent Rp 500 billion (US$37.13 million) to acquire an 80 percent stake in Sinemart last year.
However, its biggest competitor Rajawali Citra Televisi Indonesia (RCTI), a subsidiary of PT Media Nusantara Citra (MNCN) owned by tycoon Hary Tanoesoedibjo, won its legal challenge to the deal in West Jakarta District court on March 16.
A long legal battle seems set to follow, as Sinemart plans to challenge the ruling, ignoring the court’s statement that declared the verdict was final and binding.
Sinemart founder Leo Sutanto’s lawyer Harry Ponto said that they would “fight back”, arguing that the verdict was issued in the absence of the defendant.
“The letter [to summon the defendant] was sent to Sinemart’s old address, which is not used anymore,” he told The Jakarta Post on Thursday.
Ruling in favor of the plaintiff, the court revoked the IEG deal, ordering Leo to pay Rp 2.64 trillion in fines and to publish an apology letter in nine national newspapers.
“Sinemart unilaterally terminated an exclusive contract with RCTI,” MNC Media Group president director David Fernando Audy told the Post on Thursday, explaining why the media group brought the case to court.
Many of Sinemart’s productions such as Tukang Bubur Naik Haji, Anak Jalanan, Anugerah Cinta had brought high ratings for RCTI during prime time. “[Sinemart contributed] about 12 percent to the firm’s business,” David said.
In a note to investors dated on Dec. 23, 2016, PT Mirae Asset Sekuritas Indonesia analyst Christine Natasya wrote that Sinemart’s content helped RCTI’s audience share to reach its peak to become the highest vis-a-vis other free-to-air TV channels.
SCMA in a previous statement also believed that its audience share during prime time might increase this year with more programs provided by Sinemart.
“SCTV decided to continue airing three ‘sinetron’ as its prime-time programs. As a result, SCTV occupied the number one spot in prime-time audience share for seven days out of the last 10 days of March,” Christine of Mirae wrote in her note.
At present, SCTV is still running four soap operas from Sinemart, namely Mawar dan Melati, Anak Langit, Boy and Berkah Cinta, Sinemart corporate secretary Abdul Aziz said.
David claimed that after Sinemart’s departure for SCTV, RCTI’s performance improved as production house MNC Pictures, a wholly owned subsidiary of MNCN, took over the prime-time slots previously occupied by Sinemart shows, with new content.
“We are very happy with RCTI and MNC pictures, which reached another record high for this year, with a prime-time performance of 25.1 percent,” he said, citing its soap opera Dunia Terbalik that won an average prime time rating of between 24 and 26 percent.
Soap operas accounted for 15-20 percent of MNCN revenue last year.
SCMA president director Sutanto Hartono declined to comment.
