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India's Leading Source for Broadcasting & Broadband Information - CableQuest Magazine
HomeInterviewsTechnology will be a Big Disrupter

Technology will be a Big Disrupter

May 31, 2016
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If we have to survive and grow as a business and industry, the entire ecosystem should work hand-in-hand and be more proactive to create new policies, systems and partner effectively to build markets. Trust, innovation and communication betweeen MSOs and LCOs is necessary  to ensure a long, seamless partnership. An exclusive talk with Jagdish Kumar, a Veteran in the industry and MD & CEO of the largest MSO Network in India.

CQ:  Phase-III of Digitisation was declared completed on 31st December 2015 by the Ministry. What is your take now on the present state after four years of mandatory digitisation?

JK: As per the I&B ministry, Phase III has completed 95 per cent across India, which is a creditable achievement for the industry. However, currently  there are two areas of concern, firstly the uncertainty of extension of stay from courts in some of the  states which we hope will be settled by  the Supreme Court shortly. Secondly, lot of broadcasters are still delivering analogue signals which needs to be stopped completely and broadcasters need to understand that to achieve 100 per cent digitization its very important to switch off the analogue signals.

In Phase 1 and Phase 2 markets, the scenario is more stable now with new pricing and packages. Consumers are more aware about the launch of new channels and the concept of packaging, which is resulting in significant ARPU growth for LCOs and MSOs. For Phase-3 though, Cable TV operators are also facing lots of obstacles in deploying boxes.

It is often said that paying capacity in phase III areas is not high and subscribers are not capable to pay. But even in Phase-3, there are some areas such as Gurgaon and Noida, where people can afford and are ready to pay. But at the same time, there are certain areas where paying capacity of subscribers is not high. Digitisation enables segmentation of customers according to their individual preferences and paying capacity.

CQ: Do you think consumers in Phase I & II cities have started getting the benefit of digitisation as envisaged by the Ministry while introducing the Cable TV Act Amendment in 2011?

JK: As I mentioned, scenario in Phase I and II is much more stable and consistent now as billing, packaging is happening more proactively and consumers have wider choice of packages and channels to choose from as per their demands. There is lot more variety in the offerings for the consumers. HD services are picking up as consumers see the need to watch entertainment with a better viewing experience. With digitization, many other channels have been launched which is seeing an uptake in consumer demand. We have built a robust SMS back-end with Oracle Billing and Revenue Management System(OBRM), which is yielding results in terms of speed of delivery/provisioning and also empowering LCOs/Customers to manage their services without much human intervention.

CQ: Have you faced any problem in integrating last mile networks in migration to digital cable?  You may consider this from the point of view of signing of interconnection agreements, upgrading of last mile networks, providing quality services to consumers and revenue collection.

JK: When the geography is so widespread and diverse, it’s not easy to migrate things without challenges. We are talking about 15 years of analogue shifting to digital within a short period of time ,which is a collosal exercise given the nature and dynamics of the cable business, the vast subscriber base, no of operators etc. However, post phase-1 and 2, things are now steady as LCOs are aware about the digital shift and are better prepared to handle the situation. Hence, we are conscious that agreements, billing systems etc need to be fully in place to ensure seamless migration and hence we have made substantial investments in technology and systems to prepare industry for the new digital way of working. We are working with our partners to ensure that all regulatory requirements like inter-connect agreements are fully complied with.

CQ: How have you resolved the issue of revenue sharing with LCOs?

JK: We are proactively engaging with our LCOs and developed a fair revenue share in the existing markets, however, this is an ongoing process. We are engaging& connecting with LCOs to evaluate the terms of business. Our new portal for LCOs, Hathway Connect is a big step in this direction where we are technologically empowering them to services customers in a better way and enhance their own business with system and latest technology. Moreover, our new packaging model has a lot of benefits for LCOs as well from a revenue share perspective.

CQ: What technology are you deploying in the last mile to provide broadband services to subscribers? Are the LCOs ready to upgrade and learn the techniques?

JK: Hathway  has been the  pioneer in  launching   high -speed  50MBPS  plans in  the country  using  DOCSIS 3  technology   in  partnership with  CISCO. To  ensure that our consumer  has  options for  even  higher speed limits, we have tied up  with  Huawei  for Metro Ethernet  LAN  and  with  ZTE  for   GPON (Fibre to  home  solutions ). With both these technologies, we are ready to offer 100 mbps plans to retail consumers at affordable rates. Additionally, we have been proactively working with the LCO partners across all markets where our services are present to ensure seamless broadband experience to our customers. Our LCO partners have been very supportive as they realize the potential of broadband services as a great growth driver and hence, are also focusing on this business apart from Cable TV.


CQ: Any value added services like VoD, interactive games, e-shopping etc provided by your company?  Please also specify what technology is deployed for this purpose. Have you started providing OTT services in your network? 

JK: In the digitization era, Content and Value-added services will play an integral role for Hathway in defining and transforming customer experience and with this aim, for which we have already restructured our content team internally and expanding roles to focus and build wider content revenue streams in segments like OTT and VAS. Further, we are also developing a robust ad-sales team to monetize our large bouquet of in-house channels which we will be rebranding and re-positioning shortly. Additionally, we have also launched new channels in a new, sophisticated, vibrant look and design to ensure best experience for our customers. Hathway is looking at an aggressive roadmap to build its content portfolio to increase revenue generation and will be looking at the next level of customization by offering its subscribers products & solutions which will provide added entertainment & benefits to build better ARPUs. We are already engaging with multiple vendors for OTT services and will start roll out plans in a few months.


CQ: Do you feel, going complete IP will be better for India than providing broadband on DOCSIS- 3? Now after four years of experience in migration to digital, do you feel some changes are required in the regulations? Please give your suggestions if any.

JK: The current licensing regime for Broadband services does not encourage penetration or proliferation of broadband services in the country. The fixed broadband industry is the backbone on which internet services will reach the masses. Unfortunately all service providers are burdened with the 8% license fees on gross revenues. We hope the Government removes this fees completely and encourage all service providers to make investments in making internet ubiquitous across the length and breadth of the country. It is  well accepted that widespread internet availability will be a huge GDP multiplier.


CQ: Are the consumers aware of a-la-carte options and demanding pay channels accordingly  or still you are relying on distributing TV channels only in complete packages?

JK: As I mentioned, we have launched new packaging recently. Our packaging strategy is to make things simple, convenient & flexible with more add-ons offered to customers which is much better and feasible. We want to offer simplified packaging with value for money. Our objective is to provide “More for Less”, thus, offering more number & variety of channels at a reasonable price band. Our two main base packs, namely, Prime and Royal are priced in the range of Rs 275-300 &Rs 375-425, respectively, while the Royal HD pack is priced b/w Rs 525-550, which is very competitive and more economical than what DTH offers. Our strategy is to offer value for money at specific price points with the best channel offering. Apart from Prime and Royal, we have the BST (Basic Service Tier) already which is priced around Rs 100 plus tax.

We have also started communicating through marketing initiatives to our LCOs and consumers on both offline and online levels to ensure subscribers are aware about our packaging and start migrating. They are getting more familiar with the options including ala-carte channels and will start adopting similar methods as DTH even in Cable.


CQ: What preparations your company has made for entering Phase-IV areas. Do you feel there is adequate digital market in these phases for large MSOs to enter? Are you facing problem of accessibility, lack of existing infrastructure and integrating small networks of rural areas?

JK: We are currently focusing on seeding and completing our base for DAS-3 and plans are in place for Phase-4 as well in terms of box requirements, systems and engagement with LCOs. Definitely, Phase-4 will be a challenge in terms of bandwidth, connectivity as we are talking about the large interiors of India which have don’t know the concept of digital or digital TV. So yes, things will be difficult but we will be best prepared based on our strategies and engage with local operators and networks for reach.


CQ: What according to you is the way forward for cable operators for becoming a long term partner in the industry?

JK: If we have to survive and grow as a business and industry, the entire ecosystem should work hand-in-hand and be more proactive to create new policies, systems and partner effectively to build markets. Trust, innovation and communication betweeen MSOs and LCOs is necessary  to ensure a long, seamless partnership. Cable operators need to think advancement, technology and focus of building more customer focus to be competitive and relevant. We believe that all players in the value chain should be fairly rewarded commensurate with their investments and roles.


CQ: Any other views you wish to express?

JK: Technology will be a big disrupter going forward. Organisations should be agile and follow a two track strategy. India is a vast country with huge disparities in income and development. Hence it is important to take technology steps which combines the Old with the New in a seamless manner.

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