Spuul Launches with a Huge Ambition: Digitizing Bollywood

By Sarah Lacy , written on April 6, 2012

From The News Desk

Everyone knows that India is a huge market that will become hugely lucrative for nearly all some point.

But there's one part of India that is huge already: Bollywood. It's the largest movie industry in the world and a global sensation. It's at the same time a powerful connector of the Indian diaspora and an emissary on behalf of the color and vibrancy of Indian culture.

And astoundingly, there's no single dominant Web portal for Bollywood distribution. I guess that's not really such a shock. We barely have a functioning system for legal movie streaming between Netflix, Hulu, and iTunes ourselves.

Who knows: Maybe an emerging market's entertainment system will be less resistant to the inevitable pull of content online? That's what a new Singapore-based startup called Spuul is hoping.

Spuul was started by Sudesh Iyer, the founder of Sony Entertainment TV in India and S. Mohan, the founder of Accellion, buUuk, and several other startups. I heard about it through Michael Smith -- a former Yahoo workhorse in South East Asia who was understandably discouraged and looking for something new. After looking for a new job for the better part of a year, he met up with these two in the Singapore startup scene and was hooked. He'll be helping on business development and evangelism. It's self-funded by the founders so far. They're hoping to prove the concept first, and then raise a larger round.

Digitizing Bollywood is a known problem and a known huge market, but the key is putting together the right team to crack it. On paper, Spuul has a good shot. Their team has one foot in India but one foot in the larger Asian melting pot of Singapore. That may be a crucial mindset.

The big opportunity here is a Bollywood channel for India and the world -- not just India. And yet, the team has the right connections into the Bollywood world with Iyer's experience. Getting all those producers and studios to adopt one platform will be about as hard as getting all those rowdy babies in that delightfully bizarre Bollywood poster above to play nice together.

There are two models, to appeal to the variable pricing restrictions certain studios have. There will be a good amount of content for free, and then a step up from that will be a Netflix-like flat subscription fee of $4.99 a month, which allows the user to watch more premium content. Certain new releases will be only available on a la carte pricing of $.99 cents each. That's because some producers just won't let hot films be a part of any subscription package, and Spuul is optimizing for a broader catalog as its differentiator.

There are also some country restrictions per film, but it's mostly a global product. The company is launching with two hundred movies and will be aggressively adding more in its first few months. It has a long way to go to be anywhere close to comprehensive: Bollywood produces more than 1300 movies per year.

"Our gut tells us most technology-focused plays won't have the catalog we do," Smith says. "Our biggest competitor is piracy. But we think, like iTunes, if we give people the ability to buy something they desire with a site that's easy to use, many will do it."

The time seems to be right, as well. While there have been many millions lost on false starts, the Web appears to be finally taking off in India. It is reaching some critical mass and cheap Android-based smart phones, which outpace iPhones by a margin of nearly four-to-one in the country, will likely throw gasoline on that in coming years.

Here are a few stats, although take them with a grain of salt. I find most Internet adoption stats in the emerging world vary between rounded-up to wildly overstated.

There are 121 million Internet users now, half of that on mobile phones. There are nearly 900 million mobile accounts in the country and there are nearly 350 mobile users subscribed to some sort of data plan. The vast, vast majority of these are not smart phones, as India only reaches some nine million 3G users.

Some estimate that will explode in coming years, with some 400 million 3G devices taking over the subcontinent. That seems outrageously heady to me. But there is no doubt, India's digital economy has nowhere to go but up. I don't think it'll happen as quickly as some think. But it will happen, and it will be huge.

While there's a strange lack of Twitter usage relative to India's size and mobile adoption, Facebook has belatedly exploded. In January 2011 India had just 16.9 million Facebook million users, and by the end of the year there were more than 41 million Indians on Facebook, as it overtook Indonesia as the second biggest country on the social network.

In the US, there are few examples of a tech team and a Hollywood team working well together. Bridging the gap between what users want and what content creators want users to want has been nearly impossible. And it may still be in the case of Spuul.

But if it works, it'll be huge. Forget outsourcing and Infosys, and forget Silicon Valley me-too companies. Bollywood is the real digital money-maker of India, the thing no other emerging market on the planet has. It is just waiting to transform from a startup into a Web giant, in one way or another.

(Screenshot below)