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HomeArticlesRoop SharmaFocus more on Broadband, not Broadcasters
Tuesday, 31 May 2016 13:28

Focus more on Broadband, not Broadcasters

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Roop Sharma, President Cable Operators Federation of India speaks on the present state of the Industry.

While implementing mandatory digitisation the Ministry has completely ignored the interest of thousands of LCOs who serve 120 million households and failed to ensure the benefits flow to the consumers from the very first day, the very reason for which the mandate was given. We have already overshot the original deadline of December 2014, which was extended twice and now it is December 2016. 

The Law of DAS was made as an amendment to the Cable TV Act but the progress of Digitisation is being measured by the forced seeding of STBs in analogue consumer households without their consent and achievement of the Ministry is being worked out adding already digital and addressable DTH industry and free to air non-addressable Free Dish STBs. Both these addressable systems are in existence since 2003 and their data is being used to cover up the inappropriate planning by the Ministry.

DAS is different from Digital India

DAS was introduced only for Cable TV, else all other analogue systems like DD terrestrial network and DD Free Dish would have been included in the amended Law. Unfortunately, government has not highlighted its own failure to bring digitisation in terrestrial networks of Doordarshan and instead framed such rules and regulations that would encourage the large international and national players to take over the last mile of LCOs’ business and render them and their employees jobless.

Whereas in every effort to make India Digital, the government has kept aside thousands of crores, like for BharatNet, DD Terrestrial and Free Dish and still missed all the targets, it has refused to provide any financial or other help like exemption/ rationalisation of taxes, exemption of duties etc. to the cable TV industry.

None of the recommendations of TRAI made in August 2010 to facilitate implementation of DAS were accepted or acted upon. On the other hand unrealistic deadlines ensured that the powerful vertically integrated media groups operating DTH and national MSOs took over the market from cable operators.

Negative impact of poor planning is:-

In rest of the world, governments have spent billions in supplying digital STBs to economically weaker section to achieve digitization that too over a period of 10-12 years.

• FDI is below expectations. Only Broadcasters are bringing in the FDI to increase their monopolies, adding more channels.

• The sector has been facing numerous litigations on regulatory and tariff issues. 

• In spite of Ministry declaring that 60% digitisation has been completed, except seeding STBs  against consumer will, nothing has been achieved. 

• Since all regulations and tariff orders are subjudice and broadcasters refuse to obey any regulation, be it concerning tariff or quality of service, the industry progress has become static.

• Broadcasters refuse to provide their revenue sources and income details for their channels to the regulator to understand if the rates of the channels are reasonable and consumers are not been overcharged. 

• FDI is being misused by Broadcasters to buyout small broadcasters and MSOs are buying out the LCOs, creating huge monopolies in Media industry, highly detrimental to national interest.

• Even the government started charging service tax without giving a penny of relief or incentive to the industry in any manner like it had given to the private telecom operators or like our PM is promising to the start-ups now. We forgot these cable operators are the start ups of yesteryears.

• State governments made enough money collecting entertainment tax for Cable TV services that included even the government mandated Doordarshan channels, ranging from Rs 5 to 40% per month per household from the cable operators. Even Right of Way rates have been increased to fill the government coffers making the services costly.

No ‘Make in India’ in this Industry. So far the Ministry has not been able to encourage STB manufacturers to make enough STBs and make them affordable to consumers to facilitate and expedite implementation.

No ‘Skilling India’ in Cable Television. Lakhs of employees of cable operators are uneducated but highly skilled, trained on the job over the last 25 years. Large corporate who are taking over these networks, helped by the government Policies is driving the cable operators out of the industry and these skilled people are becoming jobless as they do not meet the employment criteria of large corporate.

Digital Infrastructure at the last mile is not getting improved for broadband networking as the industry is busy meeting the greed of broadcasters.

Consumer must have the right to control the Market Forces

Under present conditions no market forces are working in this industry and it is only the ‘Might is Right’ policy that works. Consumers are being openly cheated.

• Consumer does not know the cost of each channel that he is made to pay for. 

• Bouquets of channels are being forced by large players.

• A-la-Carte has been made out of consumer reach.

• Inspite of the fact that 74% households earn less than Rs 5000/- per month, Cable TV services have been made two to three times costly for them.

• Consumers do not get their choice, they are forced to have what the large Media groups serve them.

• Value additions and broadband is yet to be seen for the ordinary consumers, what the Ministry promised in the Parliament.

• Consumers can not afford Digital Services. Only 25 million subscribers in India might be willing to pay more for better services, because they understand these services and have LED/ LCD TV sets to receive the digital quality signals. 50% of Cable TV households may fall in the poor category of subscribers, having outdated TV sets that cannot provide any benefit of digital signals. 

Now Ministry wants to contest in the Supreme Court against small companies

I&B Ministry has moved the Supreme Court against orders of all High Courts where local MSOs were given some relief on deadline of Phase-III on genuine grounds as there is a dire shortage of set-top-boxes and indigenous manufacturing is next to nothing. The Supreme Court has now asked the Delhi High Court to try all the cases here and decide. 

Ministry has been time and again apprised of shortage of STBs, lack of financial support, time delay in importing the STBs, lack of network connectivity in far flung areas, RoW not provided by states and economic and technical feasibility of extending digital services of large players to many areas but it has refused to resolve the problems of small players and instead ordered broadcasters to switch off the analogue signals to all such areas, helping the large media players and DTH operators to capture their market.

Pay TV must not be thrust upon the subscriber

We talk of 6000 MSOs and 60000 LCOs serving about 120 million households. This means on the average an LCO serves 2000 households which is not true. The 40% rural market is served by very small LCOs who have not more than 300 subscribers on the average. Most of them did not carry any pay channel or had just five to six popular channels. There was no demand of more channels in these areas. So an LCO could survive with a rate of Rs 100 or less. Equating a rural or economically weaker subscriber with an urban or a Metro subscriber for tariff is not justified. 

Focus more on Broadband

Control of these pay channel groups on the distribution platforms must be curbed to the maximum if we want broadband to succeed on Cable Networks. 

Moreover, pay channels these days have many other options of making money like OTT platforms, distribution of same content in the international market, different types of advertisement and sponsorships etc. Thus they are not dependent solely on the MSOs or Cable Operators. Hence MSOs and Cable Operators must be given support for upgrading to broadband NextGen networks so that they can provide all broadband services. Only then the cable TV industry can make ‘DIGITAL INDIA’.

Thus, to realize a Digital India, if the government expects MSOs and LCOs to spend crores to migrate to Digital Cable, it should also ask the broadcasters to reduce the cost of their content to level it with analogue ARPUs in the National Interest.

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