Follow on Google News News By Tag Industry News News By Location Country(s) Industry News
Follow on Google News | Digitalisation Ball Gets RollingThe President approving the Ordinance for digitization of cable television networks on October 25, 2011 has set the ball rolling. The Ordinance seeks to amend the Cable Television Networks (Regulation) Act 1995
By: K K Sharma By K K Sharma The President approving the Ordinance for digitization of cable television networks on October 25, 2011 has set the ball rolling. The Ordinance seeks to amend the Cable Television Networks (Regulation) This is the first time that the government has tried to bring orderliness in the industry by giving the Right of Way (RoW) to the cable operators for laying their cables and making TRAI responsible for the listing out the basic package channels and the tariffs. The cable and satellite industry is estimated to be worth `20,000 crore. There were huge set of problems being faced by all the stake-holders including cable operators, MSOs and broadcasters because of the analogue system of distribution. Major constraints were that of bandwidth availability, right of way, viewership measurement, accountability and sharing of revenues and keeping up with advancements in technology of convergence. Therefore, everyone has welcomed the decision with open arms. Describing the step as positive, the multi-system operators (MSOs) believe that the move will benefit them to establish direct contact with the subscribers, which will reduce their dependence on the local cable operators (LCOs) who control the last mile. MSOs argue that the LCOs own the last mile and therefore, without "addressability" LCO are also happy because they will no more be blamed for under declaration. They may lose their control on the last mile as the STBs will be controlled mostly by the large MSOs giving them the digital feeds but they are hopeful that to have a complete control of 100 million households, it may take years for the MSOs to accomplish. Huge investments are to be made by the MSOs to do this when most of them are cash strapped at present. Market conditions do not encourage inflow of FDI. Many LCOs outside the metros, have joined hands and started installing their own digital systems. Others are happy to remain the last mile collection and servicing agents. LCOs blame the distributors of the MSOs and the broadcasters for the sad state of affairs in the industry who are trying to arm-twist them to establish their monopolies in an unorganized industry. According to them, these distributors take away their share of carriage fee and blackmail them on behalf of the MSOs and broadcasters forcing them to work on their terms or sell off the networks to them. LCOs also feel that with addressability, viewership of TV channels will be more transparent and broadcasters will not be able to force payments for their unpopular channels part of their channel bouquets, on them blaming them for under reporting. From the point of view of broadcasters, one of the major constraints in the analogue system is the availability of limited bandwidth. This coupled with the ever-rising number of TV channel launches leads to constant fight amongst broadcasters on placement allocations. Subsequently, there is an increased demand in prime frequencies, thereby hinting at higher carriage fees. With the process of digitization beginning soon, the problem of limited bandwidth will be resolved automatically. The broadcasters expect that digital distribution would help remove the capacity constraints being faced by the analog cable distribution system, helping rationalize the carriage costs for broadcasters. A large amount is paid to MSOs by the broadcasters to get their channels placed prominently on the cable platform in the form of carriage fee. Digital system will cut down the carriage fee, which will come as a big relief for the broadcasters. Also digitization is likely to improve the viability of niche channels with enhanced ability to target niche audiences through effective reach. Earlier, niche channels were not distributed by the cable operators on the grounds of low viewership. Digitization is supposed to eliminate this hurdle. With addressability the issue of under-subscription will be resolved which as a result would lessen broadcasters’ All said and done about digitization, the picture isn't that rosy as it seems from outside. It has been argued that the deadline 2014 isn't feasible given the fact, that a number of issues have not been addressed by the Ordinance. TRAI has to come up with a tariff plan and a-la-carte distribution of channels which is the biggest sore point with the pay channel broadcasters who are used to forcing their bouquets of channels on the cable operators irrespective of the fact whether the channels are demanded by the subscribers or not. The deadline isn't being considered to be realistic given the kind of infrastructure that has to be put in place to begin the process. Firstly, it will require millions of set-top boxes and then seeding of these boxes is a gigantic task in itself. The local cable operators and the MSOs may have to bear the brunt due to lack of funds and limited incentives to digitize. The last budget did not consider any of the proposals of the I&B Ministry to help digitalization. The matters related to tariffs, revenue sharing arrangement between all the stakeholders: The measure can be seen to empower consumer to high quality viewing and also higher number of TV channels. However, it also needs to be seen whether or not the consumers are completely prepared for the change. At least 25 percent of subscribers in the metros and 40 percent in the other cities who are in the poor categories may not be able to buy an STB. The emphasis on complete digitization won't leave them with a choice but to give up cable television viewing, going back to the days of terrestrial broadcasting, unless either the MSO or the government is ready to offer them free set-top-box like they did in the USA where USD 40 was paid by the government to each poor household. Since the Government's main aim is to help the broadcasters, it could generate a USOF like fund from their license fee to do the needful. Also, the broadcasters should be ready to lose a great number of their viewership. Thus, success of the Ordinance will depend on how fast the TRAI and the Ministry resolve these preliminary issues which are necessary prerequisites to the process of Digitalisation. For more detailed please visit – www.cable-quest.in # # # Cable Quest Satcom Pvt. Ltd. is India’s leading media house for Television Broadcasting, Broadband and New Media industries. Started in 1994 it has remained in the forefront as the voice of the industry. Its flagship product Cable Quest, an industry jou End
Account Email Address Account Phone Number Disclaimer Report Abuse
|
|