MUMBAI: India has 44.21 million private DTH subscribers as of 31 December 2011, the Telecom Regulatory Authority of India said in its quarterly report.

The total number of registered subscribers is from the six private direct-to-home operators – Dish TV, Tata Sky, Airtel Digital TV, Videocon D2H, Reliance Digital TV and Sun Direct.

Digital cable TV, however, is growing slowly in the Cas (conditional access system) notified areas.

Cable TV operators have marginally increased the seeding of set-top boxes (STBs) in the Cas areas of Delhi, Mumbai, Kolkata and Chennai during this period.

According to Trai, the total number of STBs installed increased to 853,737 in the quarter ended December 2011, as compared to 819,960 STBs in the previous quarter.

Trai has also released the data on the number of TV channels in India till 31 December 2011. There are a total of 825 private satellite TV channels permitted by the Information and Broadcasting Ministry, out of which 163 channels are pay, as per the sector watchdog’s report based on the data received from 25 broadcasters and distributors across the country.

The maximum number of channels being carried by any of the reported multi-system operator (MSO) in digital mode is 277. In analogue form, however, the maximum number of channels being carried by any of the reported MSOs is 100 channels.

Trai also said that the number of private FM radio stations in operation remained at 245 till the end of Dec 2011.

Source: Indiantelevision.com

NEW DELHI: Participants at a one-day meet to discuss the march towards digitisation agreed that there would be no difficulty in meeting the deadlines if the government and the Telecom Regulatory Authority of India (Trai) complete their tasks in time.

However, some of the members speaking in different sessions of the Casbaa meet ‘Beyond digital’ did not rule out the possibility of digitisation getting entangled in litigation if adequate steps were not taken till May, since the deadline is 30 June for the first phase covering the four metros.

Some of the other speakers were also anguished that the budget had not brought any cheer either in terms of customs duty holiday on digital set top boxes (STBs) or incentives for indigenous production of the STBs.

Multi-system Operators Alliance president Ashok Mansukhani said the government appeared to have done nothing after the notification. The rules of business were still not clear. For example, it was not known whether MSOs who had the CAS (conditional access system) licences would have to get fresh licences Would cable operators get licenses directly or would the business be transacted as of now through the MSOs, and what exactly will the role of the government be.

He wondered why Trai had issued a second consultation paper when it had as many as 100 responses including 80 from cable operators. He said cable networking had still not been recognised as an industry, and had not been given any tax concessions. While the MSOs had the funding, a level playing field was still missing.

He said though 30 June at present appeared to be a mirage, the industry was prepared to abide if the government got its act together.

Indian Broadcasting Foundation VP and Times Television Network MD & CEO Sunil Lulla said most broadcasters were in the red, and so the pricing has to change. And if digitisation is to help the consumer, then he should be ready to pay more.

He said attempts were on to create TV spots to create awareness about digitisation, but the government must also come forward.

Cable Operators Federation of India (COFI) president Roop Sharma said cable operators had been fighting for digitisation even before the MSOs or broadcasters had done so, but nothing was done to help the last mile cable operator or create awareness among the people. “When I am not even sure I will get content after 30 June or not, why should I spend so much money on infrastructure?” she asked.

The cable operator has to even recover entertainment tax to pass it on to the MSO, she said. She denied charges that the cable TV industry was not organised.

She wanted definite action from the government to get inter-connect regulations, tariff, and STBs.

News Broadcasters Association president K V L Narayan Rao said the race for TRPs will continue until subscription rates improve, but Trai had failed to take a decision in this regard. At the same time, he said good content must also come. He wanted greater unity on the part of the stakeholders in approaching the government.

IPTV India Forum’s Anil Prakash said IPTV had failed so far because of lack of right of way provisions and initiative of the last mile operator. He wanted the government to pitch in to reach out to the consumer.

DTH Association of India General Secretary Rajiv Khattar stressed the need for implementation. He said tax incentives were needed if the deadline had to be met.

Tata Sky MD and CEO Harit Nagpal said the government had nothing to lose, as it would get taxes; broadcasters stand to earn; and even the MSOs will break even. But it was the DTH which would be hit the hardest. At present, around 30.3 per cent was going in taxes, and DTH had not been included in the Negative List despite a ruling of the Delhi High Court that watching a programme on DTH was like entering a multiplex.

Dish TV CEO R C Venkateish said DTH was still a capital intensive industry struggling to survive, and the ARPUs were low because of under-declaration by the cable operators. Digitisation will help stop that.

Videocon d2H CEO Anil Khera said there was need for a level playing field at a time when over 30 per cent went into taxes. He said the government’s deadline appeared unrealistic but was confident that it could be met. The success of the first phase will set the tone for the other phases, he said.

Indusind Media & Communications Ltd. MD Ravi Mansukhani welcomed the plans for a unified licensing for broadcasting and telecom. He suggested the creation of a fund to help smaller MSOs or cable operators. Though he had at first felt that it would be better to split digitisation into first pay channels and then free to air channels, he felt it was better to go directly into the new technology.

Star Network Vice President (Regulation) Pulak Bagchi and Cisco India’s Sanjay Rohatgi were confident the deadline would be met. Bachi said this was because of the Indian appetite for change, dynamism and productivity of the people.

Hathaway Cable & Datacom MD & CEO K Jayraman said things will work if Trai gets its work done. He said 10 million STBs were needed for the first phase, and 20 million for the second phase. He felt that there was time for the industry to fight for fiscal incentives.

Source: Indiantelevision.com

Mumbai, Mar 15 (PTI) The implementation of digital addressable system (DAS), successor to the original conditional access system (CAS) which was supposed to digitise the TV industry, is expected to enhance financial viability of niche channels, industry experts have said. “We are likely to see this happening by the middle of next year. At the moment, even a niche channel, which gets lesser revenues than a mass-market general entertainment channel, has to pay the same amount as carriage fee to a DTH platform provider. “But after digitisation, this is expected to change, since niche channels will have to pay lesser carriage fee based on their subscription base which can be tracked more accurately,” KPMG India Head for Media & Entertainment Jehil Thakker told the Ficci Frames here today. Television channel heads, who did not wish to be quoted, echoed similar sentiments. “After digitisation, niche TV channels will become financially much more viable,” said a TV channel head. A Ficci-KPMG report says that subscribed channels can be received at the customer’s premises only through a set-top- box equipped with a conditional access card and a subscriber management system, through which each user in the network would be uniquely identifiable to the service provider. Digital TV is also expected to provide the consumer access to a higher number of channels, customised tariffs, availability of broadband and other value-added-services, besides better viewing quality, the report said. “Customised tariffs would effectively mean a customer would pay only for what he/she watches, unlike a flat fee being levied today. This too would ensure that niche channels become more viable,” an industry expert said.

Source: IBNLive.com

Cable TV users in Chennai will have to buy a set top box before July 1, when all cable operators will switch to providing signals only in digital mode. This has been directed by the Union information and broadcasting ministry.

Some 20 lakh households in the city with non-DTH connections will have to go for set-top boxes to continue watching their favorite television channels.

“All households in Chennai which are using the conditional access system (CAS) will have to buy new set-top box from the cable operators.

Currently only 2.5 lakh have set-top boxes, while over 20 lakh homes have direct connections through cable operators, and another 2.5 lakh, Direct to Home (DTH) connections,” say sources in the Tamil Nadu Arasu Cable TV Corporation Limited ( ACTL).

Once the digitisation happens, it will lead to standardisation, giving viewers access to all channels. But the I & B ministry’s order has bemused the ACTL as it had recently invited cable TV operators here to join it after breaking the monopoly of SCV in other parts of TN.

It is now debating whether to accept the applications from cable operators in Chennai or wait till the end of June. “We are now wondering whether to go ahead with the applications received from Chennai cable operators or not. We will decide this after discussing the issue with the government,” says an ACTL official

The ACTL is clueless about where to acquire the set top boxes that are to be used from July 1. “We have not yet received any directions from the Centre. Procuring set top boxes and distributing them is not going to come cheap,” note the officials.

Source: Deccan Chronicle

Reports suggest that the government is planning an ordinance to scale up digitisation of the cable and satellite television industry. The move will speed up pay-TV revenues for broadcasters and curtail carriage costs.

G Subramanium, chief finance officer of Hathway Cable and Datacom , in an interview to CNBC-TV18, said that in a bid to meet March deadline, government is contemplating an ordinance to expedite digitisation.

Subramanium expects to see huge growth in subscribers post digitisation. “Carriage fees will go down for broadcasters post digitisation, but subscription revenue will make up for loss in carriage fees,” he added.

Below is the edited transcript of the interview. Also watch the accompanying video.

Q: What material impact does the move of digitisation will have on Hathway in terms of number of disclosed subscribers and the number of paid subscribers that you can actually derive revenues from?

A: There will be substantial growth in subscribers because the number of subscribers, who are declared to us by the local cable operators, is a fraction of the universe that we actually deal with. Therefore, multiple increases in subscribers are expected to be seen.

Q: What is your understanding of the Cable TV Regulation Act, which the government is trying to implement through an ordinance? What kind of timelines are we working with?

A: The government had contemplated timeline starting March 2012 with a sunset date for country-wide digitisation by December 2014. Once the government formalises the process, we will need about five to six months to gear up. Many of us, particularly the multi-system operators (MSOs) have already got prepared. We are making investment in backend systems, we are modernising our call centers.

We, as a company, are fairly well-positioned to take advantage of digitisation as and when it occurs. We not only provide cable television service but we are also a substantial broadband services provider.

Q: Even if you won’t get into specifics in terms of change in subscriber declaration levels, how much of an increase we could likely see because right now the market is working with estimates of seeing a four times jump over the next couple of years once this comes through. Is that too ambitious or would you agree with that point of view?

A: It will be probably north of that. It depends on certain variables. As and when digitisation happens, the customer is going to be faced with a choice of remaining with cable platform or migrating to other platforms.

We believe that cable is a far superior product and when it will be digitised, we will be able to bundle other services with it. The bandwidth, which will be on offer, will be far higher than other platforms like DTH. Therefore, given the superior product offering at price points, which are far lower than DTH, we should be able to garner very good share.

Q: Government may also take a call on removing pricing caps for channels at the retail level. What kind of impact that may have for you?

A: It all comes down to giving consumer a choice when price cap at a retail level would be removed. The TRAI has proposed in its note that there will be a base price of about Rs 150 for the basic tier.

This proposal will encourage subsidy on the set top box and will ensure that the deployment of digital boxes happens rapidly throughout the country. It is a great opportunity for broadcasters to ensure that they invest into content and give the consumer what he wants.

Q: Do you think digitisation will reduce the carriage fees that broadcasters pay to cable operators?

A: Yes because carriage fee is a premium that you pay since there is a scarcity of spectrum in the cable networks. As and when digitisation happens the quantum of spectrum available on those networks will grow manifold, and therefore, the premium that you can place on scarcity will go down. However, it won’t go down to zero. You will still have to pay a premium of 25-30%.

Q: What kind of a churn away from digitised cable to DTH do you expect to see once this transition happens?

A: Digital cable is a far superior platform in terms of technology. It is capable to offer good amount of bandwidth and bundling of services. Thus, I don’t see huge amount of churn in that. In fact, we have seen churns as low as 3-5% in CAS areas, so when digitisation happens, we will be competing on a more-than-equal platform. Hence, I’m confident that the churn will be minimal.

However, it all depends upon how the industry is gearing up to face competition. If we are well prepared, if we invest in those backend systems and we improve the quality of services that we deliver to the customer, then we won’t face that much of a churn. DTH thrives in an environment, where there is an exclusivity of content. In India, we still do not have that sort of a situation, and therefore, both the platforms will compete on an equal footing.

Source: Moneycontrol.com

In a move that will ensure that the cost of cable channels will continue to remain affordable for consumers even after shifting from analogue to digital services, the Supreme Court last week ordered a new tariff formula for all digital addressable platforms.

The apex court has fixed 42 per cent of non-CAS tariffs as the new benchmark for all future commercial agreements between broadcasters, direct-to-home (DTH) firms and MSOs offering digital cable services. This formula will now replace the earlier tariff orders (35 per cent by Trai in July 2010 and 50 per cent by TDSAT in July 2006).

Simply put, this means that DTH, digital cable, and IPTV operators will only pay the broadcasters up to 42 per cent of the tariff fixed in the analogue cable market (non-addressable and un-regulated). This is important because the government has recently oulined December 31, 2014 as the cut-off date for shifting to digital and addressable cable services.

Experts said the new order will not have much impact on the DTH operators as most of them have signed long-term commercial deals with the broadcasters. However, this will help the MSOs get into agreements with broadcasters under a well-defined commercial formula.

The apex court gave the interim-order while hearing a plea of the Telecom Regulatory Authority of India (Trai). The broadcast regulator had gone to SC challenging a TDSAT judgement of December 2010 which had set aside its 35 per cent tariff order for DTH platform. The Trai’s 35 per cent tariff formula was opposed by most broadcasters.

A bench comprising justices RV Raveendran and AK Patnaik stayed the order of the Telecom Disputes Settlement & Appellate Tribunal (TDSAT), which had set aside Trai’s notification of July 21.

While most MSOs and DTH operators have welcomed the move, the new formula will impact the margins of broadcasters and DTH operators as they will realise lower revenue from digitally addressable homes, experts said.

“The court’s order has removed the tariff-hurdles in the path of digitalisation. As we move towards the complete digitalisation of the cable services, the 42 per cent tariff formula will help all stakeholders in coming years,” said Ashok Mansukhani, president, MSO Alliance, the apex body of leading Multi-Service Operators (MSO).

A top executive of a leading MSO firm said the 42 per cent tariff order will drastically reduce the litigations between broadcasters and cable distributing firms. “Also, there will be a five to six fold jump in the subscription declaration as a result of digitalisation and the clear tariff formula on digital platforms,” the MSO said.

The Shares of Dish TV tumbled as much as 6.5 per cent after the news of SC’s new tariff formula came out. At the close of trading hours on Monday, Dish TV’s stocks were down 2.49 per cent. In contrast, the scrips of MSOs like DEN (5.63 per cent), Hathways (9.87 per cent) and WWIL (4.44 per cent) saw upward movement.

Before the Trai’s 35 per cent tariff order proposal, all commercial deals between broadcasters and DTH operators materialised at 50 per cent of non-CAS rates (a formula given by a 2006 TDSAT judgement). However, in July last year, Trai, after consultation with the stakeholders, had came out with a new tariff order fixing the tariffs on DTH at 35 per cent of the non-CAS rates. This was challenged by most cable distribution firms and broadcasters. In December 2010, TDSAT set aside the Trai’s 35 per cent tariff order.

According to the earlier (50 per cent of non-CAS rates) formula, a channel costing Rs 50/subscriber in non-CAS areas (most of India) was to be priced upto Rs 25/subscriber on the DTH/digital cable platform (50 per cent formula). Now the same channel will can not be priced beyond Rs 21 (42 per cent formula as per SC’s interim order).

Source: Indian Express

NEW DELHI: The Information & Broadcasting Ministry would like to take forward the recommendation of the Telecom Regulatory Authority of India (Trai) to up foreign direct investment in direct-to-home to 74 per cent but there are processes involved before this can be done, said I&B secretary Raghu Menon.

Menon said DTH had taken television to the remotest corners of the country and so the government would like to encourage the sector.

On another issue, he said Trai had recommended a complete switch-off of analogue by 2013, but that was a complex issue and may not be easy to implement. He said the sunset date will have to be extended.

However, he said Prasar Bharati was working on achieving full digitisation by 2017 and was working on the first phase to be completed by 2013 at a cost of Rs 15.62 billion.

Addressing the one-day meet on ‘Addressable India’ organised by the Cable and Satellite Broadcasters Association of Asia (CASBAA), he said digitisation had been given a boost by the DTH and Cas (conditional access system).

The I&B Ministry was also helping Prasar Bharati increase the capacity of channels on DD Direct Plus, the country’s only free-to-air DTH, to 97 in the first phase and finally to 200 by mid-2012.

Referring to the growth of high definition TV and 3G on mobiles making access of TV content easier, he said a three-member committee on use of mobiles for TV had already given its report which was under study.

He said the growth of the broadcasting sector in India had been one of the highlights as even the recession did not stop this growth pattern with leaders thinking out of the box. It was set to emerge as a flag-bearer of India on the global scenario.

He said that reports had indicated a 13 per cent CAGR for television by 2013. It had achieved a target of 8.5 per cent by 2009 and had become a Rs 265 billion strong industry.

The country now had just under 600 TV channels with 65 foreign channels, he said.

The Ministry would facilitate this growth and was therefore liberalising this process. Digitisation had transformed everything, leading to a paradigm shift. The TV screen may soon be a thing of the past with computer screens taking over.

Digitisation had begun with DTH, then Cas, followed by HITS (Headend-In-The-Sky) and IPTV, enabling content providers and giving greater choices to consumers. DTH cannot replace cable but will force that sector to digitise.

Though the Trai tariff order was under challenge in courts, it was expected to improve things when implemented. Tariff and inter-connection issues also have to be worked out for HITS.

But he noted that since HITS was voluntary, the pace of digitisation will be slow unless a timeline is set. However, timelines are not easy to achieve in a vast country like India and migration may be difficult. This may not be possible unless there are affordable set top boxes, greater mobilisation and investments.

Earlier, Trai chairman J S Sarma referring to the National Broadband Plan and the consultation paper submitted by the Authority in this regard yesterday, said TV was a good medium for spreading broadband, and stressed on the need to lay a network of optical fibre and suggested the setting up of a National Optical Fibre Agency (NOFA).

He said TRAI had also recommended setting up a National Broadband Network to help the government achieve its goal of 20 million broadband connections all over the country.

He said in order to go fully digital, the recommendations of Trai dated 5 August 2010 on “Implementation of Digital addressable system in India” will need to be implemented on priority basis.

The Government may review the duties levied on inputs and finished products used in providing broadband and Internet services. Customer premises equipment including modem and routers used for Internet and broadband may be considered for 100 per cent depreciation in the first year, he said.

Introducing the meet, Casbaa India head Anjan Mitra said the DTH sector was steering towards an aggressive acquisition mode with Indian DTH subscribers reaching a record high of 1.7 million in November. Between March and November 2010, the DTH sector had matched its last fiscal customer pile up by acquiring a total of 8.5 million subscribers in just eight months.

Tam Media Research CEO LV Krishnan said that while the analogue industry had grown by 11 million in the last four years, the digital industry through DTH and other means had grown by 29 million. Cable and satellite had seen a growth of 16 per cent last year and 13 per cent this year.

The terrestrial viewing had shrunk from 30 to 26 million homes and it was interesting that DTH had seen a greater growth in the rural areas than in urban areas in the initial years. The rural sector was also moving towards pay TV and while 86 per cent subscribers in urban areas were on pay, the rural area subscribers had doubled to 64 per cent in recent years.

Referring to viewing patterns, he said the choice of channels was clearer among young audiences; there were more points of consumption and even repeat content, and there were higher conversions to digitisation. Digital TV was expected to go up to 38 million homes soon.

Source: Indiantelevision.com

The DTH subscriber base has grown to 23.77 million viewers by the end of June quarter from 21.3 million users in the previous quarter, sectoral regulator the Telecom Regulatory Authority of India (Trai) said today.

According to Trai, six DTH licensees (excluding DD Direct) reported subscriber base of 23.77 million (for the quarter ended June 2010) as against 21.3 million at the end of March 2010, indicating an increasing penetration of the service.

The DTH subscriber base stood at 15.17 million in the quarter ended June 2009.

Apart from the free DTH service of Doordarshan, there are six private DTH licensees — Dish TV, Tata Sky, Sun Direct, Airtel digital TV, Reliance BIG TV and Videocon d2h.

On installation of set-top boxes in Conditional Access System (CAS) notified areas in the four metros, Trai said 7,70,519 boxes had been installed till June 30 this year.

On the mushrooming of television channels in the country, the regulatory body said there was a total of 150 pay channels as of June 30, based on the data received from 24 broadcasters and their distributors across the country.

Total number of channels registered with Ministry of Information and Broadcasting has increased from 503 in March 2010 to 515 in June this year.

The number of private FM Radio stations in operation stood at 248 at the end of June 2010, it added.

Source: Business Standard

GUWAHATI, Sept 5 – With threat looming on their existence due to the Telecom Regulatory Authority of India (TRAI)’s recommendation to close analog cable TV networks by 2013, the cable TV operators of Assam have sought the help of the State Government to bail them out of the situation.

A meeting of cable TV operators of Assam was convened today by Greater Guwahati Cable TV Operators Association (GGCTOA) at Guwahati, which resolved to ask the State Government to exempt their service from Assam Amusement and Betting Tax (AA&BT), till it goes digital.

Operators from different parts of State took part in the meeting.

“Though cable TV industry falls under the small scale industries sector, it is yet to get the desired benefits from the Government. Giving employment to a number of local youth across the State and airing local TV channels, the cable TV industry is facing an uneven competition from the multinational DTH operators, who enjoy all the benefits from the Government,” said Sanjay Deb a cable operator from Upper Assam, while addressing the media here. He stressed on the fact that the State Government should take steps for recovery of AA&BT from the DTH service providers also.

Rajesh Sarma, president of GGCTOA mentioned that the State Government should take up the matter of immediate implementation of the Conditional Access System (CAS) with the Ministry of Information and Broadcasting. The CAS gives the consumers a facility to pay only for the channels of their choice.

The service providers would observe a cable black out programme from 6 pm to 10 pm on September 7 at first phase and from 5 pm to 10 pm from September 12 to 14.

The association also demanded the State Government to provide infrastructural and financial co-operation to the cable operators to shift to digital mode before the TRAI deadline. “Assam Cable Communications (ACC), an initiative by the local entrepreneurs has already been working in the field of digitalization of cable network at a very subsidized rate and has won accolades nationally and internationally for being the only Digital Head-end in the entire Northeast. The Government should promote such entrepreneurs,” Deb mentioned.

Other demands of the association include formation of monitoring and implementation committee at State level for implementation of TRAI and Cable TV Act, comprising cable TV operators and Government officials.

Source: The Assam Tribune

Equity analysts feel that the markets have overreacted to TRAI’s recommendation of complete digitisation by 2013. Stocks in the cable distribution and DTH business, DEN Networks, Hathway Cable and Dish TV saw gains in excess of five per cent each.

These gains are unsustainable and only DTH operators would reap the benefits of complete digitisation as individuals feel it is a nuisance to interact with local cable operators, said an analyst from a large broking house. DTH operators like Tata Sky, Dish TV and Reliance Big would do well as it has already been proved beyond doubt that mandatory CAS (conditional access system) implementation has not worked, he added.

But there are contrarian views as well. “Every geography does not support DTH and hence cable operators will survive side by side. Though the TRAI recommendations have been made, implementation is still some time away,” says Mr Anand Shah, Media Analyst at Angel Broking.

Thumbs up

Market players are gung-ho about the implementation of digitisation. They feel the waiver of customs duty on set top boxes for three years coupled with an eight year tax holiday will benefit all players – broadcasters, distributors and MSOs (multi system operators). “Whatever the ratio of cable to DTH, it will benefit all players. Even the government envisages collecting approximately Rs 1,400 crore in the form of service tax, against the existing Rs 75 crore. This would be backed by a steady increase in ARPU (average revenue per user) and a significant increase in declaration levels that was pathetic erstwhile,” added Mr Shah.

Consumers are also voluntarily shifting towards CAS given the quality of reception, say market players.

The preference seems to be CAS wherever the population density is high and DTH in far flung areas.

One cannot replace cable with DTH for the simple reason that cable is very efficient and can also triple up to deliver broadband and telephony services (if regulations permit).

When companies with low declaration levels could register a gross margin of 30 per cent, this move towards digitisation would surely provide a boost to existing players and a 50 per cent margin would not unrealistic to expect.

This is because the business operates on a predominantly fixed cost model with one time expenditure and steadily increasing annuity income, said an analyst.

The recommendations have indicated a funding requirement Rs 55,000- Rs 60,000 crore for full digitisation across India.

This would entail large scale funds being raised overseas through the FCCB/ECB/GDR route by companies.

The cable broadband business is in the same stage of evolution in India that telecom was 10 -12 years ago and hence the entry of large players with deep pockets into this business is imminent, the analyst added.

DEN Networks, Hathway Cable and Datacom, and Dish TV closed 12.29 per cent, 8.53 per cent and 6.19 per cent over their respective previous closing prices to close at Rs 237.25, Rs 211.95 and Rs 49.8 on the NSE.

Source: The Hindu Business Line