Cable TV

Carriage fee on a rise again?

Published

11 years ago

November 18, 2014

MUMBAI: Delayed digitisation of phase III and phase IV areas have marred the hopes of broadcasters, multi-system operators (MSOs) and the local cable operators (LCOs) alike. With implementation of digitisation in phase I and II, while broadcasters were enjoying the reduced carriage fees, MSOs were hoping for better on-ground collections with increasing transparency. But all this has taken a U-turn with the Ministry of Information and Broadcasting announcing 2016 as the year when India will be fully digitised.

The MSOs who have invested heavily for digitising phase I and II markets are still waiting for reaping the benefits of it. And now even the broadcasters who saw some reduction in carriage fees (industry sources peg it between 10 per cent to 30 per cent) during the first two phases have gone back to basics.

If one has to go by the Media Partners Asia (MPA) report, the cable TV industry has seen a 14 per cent jump in carriage fees. The reason for the jump in carriage fee could be many. Here are a few reasons which we understand could be playing a role in the changed carriage fee pattern:

1) Delayed digitisation: The MSOs have already invested heavily in phase I and II and have also borrowed money for phase III and IV markets. Now with the government announcing the final dates for digitisation as 2015 for phase III and 2016 for phase IV, MSOs fear that the LCOs will not increase their collections from the ground.

2) Low ARPUs: Even in phase I and II areas, the ARPU hasn’t gone up as expected by the MSOs. And so they haven’t been able to recover the money they had invested.

3) New channel launches: Broadcasters launching new channels need greater reach and visibility and so pay more in order to get carried by the platform and also to ensure that it is available to all the subscribers of the platform. This in turn sets a benchmark for the other players also.

4) Lack of transparency: Even though one of the aims of digitisation was bringing in transparency and addressability, both haven’t happened as yet. The cable operators have not been able to get the consumer application forms filled and thus, are still unaware of the choice of consumer. Also, there is still under declaration of consumers.

“This is true especially for news channels, niche channels and the new channels that have been recently launched. While the existing channels have not seen any hike in carriage fees, broadcasters that launched new channels in the different genres, right from GECs to regional to music and movies have seen a jump in carriage fees, which ranges from 15-25 per cent,” says a distribution head on condition of anonymity.

Another source close to the development agrees and says, “Yes! The carriage fee for broadcasters launching new channels have gone up. This can be anywhere between 20-25 per cent, depending on the distribution strategy of the broadcaster and the visibility it is looking for.”

Many in the industry blame the new channel launches for the increase in the carriage fee. “While for the news channels the carriage fee had seen a drop by 10-15 per cent, the new channels that are being launched every now and then, sets a different benchmark. Since broadcasters want better reach for their new channels, they pay huge sums as carriage fee to MSOs and this affects the news channels as well,” says a news broadcaster.

Even at the recently concluded MIPCOM 2014, Colors CEO Raj Nayak during a panel discussion had stressed that there needs to be complete implementation of digitisation. “While in the phase I of digitisation, the carriage fees had come down by 20 per cent, it has now gone back to square one and this is a dangerous trend,” he had then said.

Viacom18 group CEO Sudhanshu Vats feels no different. In his recent interaction with Indiantelevision.com he had said, “Carriage, rather than continually coming down, has begun to rise again in recent months.”

According to India TV chairman and editor-in-chief Rajat Sharma, when digitisation kickstarted, news broadcasters expected consumers to get better quality channels and carriage fees to disappear. “For the MSOs, it is the carriage fee from the news channels that helps them sustain, since they pay the GECs huge sums for getting their programming on their platform,” opines Sharma.

Unlike the expectations by many, carriage fees haven’t yet been abolished. “When phase I of digitisation was implemented, carriage fees did come down in terms of what was being paid in the four metros. The national level MSOs saw the benefits of digitisation and passed on some of that benefit to broadcasters. However, with phase II, it hasn’t happened. On the contrary they are going up and extortionist demands are being made again. Perhaps because in other parts of the country the MSOs are in partnership with local or regional players who do not want to let go of carriage fees even though that was meant to be a natural outcome of digitisation,” informs NDTV executive vice chairperson KVL Narayan Rao.

Rao further adds, “It is impossible for news broadcasters to withstand payment of high carriage fees. Other components of digitisation like buoyant and fair subscription revenues, have not kicked in either. Something needs to be done about these aspects immediately. Carriage fees in particular have to be rationalised.” Rao also pegs the carriage fee increase between 10-30 per cent.

As for Focus Network group CEO Neeraj Sanan, carriage fee revenues for MSOs are likely to reduce. “However the carriage paid by a broadcaster to an MSO, will increase post first year of DAS due to aggregation at MSO level and the ever increasing number of channels,” he adds.

Even the MSOs agree that the carriage fee has seen an upward trend. “This is true mostly for the new channel launches. Broadcasters want better reach for their new channels and are ready to pay more carriage fee for those channels. The new channels are seeing a hike in carriage fee by about 20-25 per cent,” concludes the MSO.

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Cable TV

Den Networks Q3 profit steady despite revenue pressure

Published

3 weeks ago

January 19, 2026

indiantelevision.com Team

MUMBAI: When margins wobble, liquidity talks and in Q3 FY25-26, cash did most of the talking. Den Networks Limited closed the December quarter with consolidated revenue of Rs.251 crore, marginally higher than the previous quarter but down 4 per cent year-on-year, even as profitability stayed resilient on the back of strong cash reserves and disciplined cost control.

Subscription income softened to Rs.98 crore, slipping 3 per cent sequentially and 14 per cent from last year, while placement and marketing income offered some cheer, rising 15 per cent quarter-on-quarter to Rs.148 crore. Total costs climbed faster than revenue, up 7 per cent QoQ to Rs.238 crore, driven largely by higher content costs and operating expenses. As a result, EBITDA dropped sharply to Rs.13 crore from Rs.19 crore in Q2 and Rs.28 crore a year ago, pulling margins down to 5 per cent.

Yet, the bottom line refused to blink. Profit after tax stood at Rs.40 crore, up 15 per cent sequentially and only marginally lower than last year’s Rs.42 crore. A healthy Rs.57 crore in other income helped cushion operating pressure, keeping profit before tax at Rs.48 crore, broadly stable quarter-on-quarter despite the tougher cost environment.

The real headline-grabber, however, sits on the balance sheet. The company remains debt-free, with cash and cash equivalents swelling to Rs.3,279 crore as of December 31, 2025. Net worth rose to Rs.3,748 crore, while online collections accounted for 97 per cent of total receipts, underscoring strong cash discipline across operations, including subsidiaries.

In short, while Q3 showed signs of operating strain, the financial backbone remains solid. With zero gross debt, steady profits and a formidable cash war chest, the company enters the next quarter with flexibility firmly on its side proving that in uncertain markets, balance sheet strength can be the best growth strategy.

Cable TV

Plugging along as Hathway tunes in steady profits this quarter

Published

3 weeks ago

January 17, 2026

indiantelevision.com Team

MUMBAI: In a quarter where staying connected mattered more than moving fast, Hathway Cable and Datacom kept its signal steady. The cable and broadband major reported a net profit of Rs 21.7 crore for the December 2025 quarter, marking a clear improvement from Rs 13.6 crore a year earlier, even as pressures persisted in parts of its operating portfolio.

For the quarter ended December 31, 2025, revenue from operations stood largely flat at Rs 536.6 crore, compared with Rs 511.2 crore in the same period last year. Including other income of Rs 21.1 crore, total income rose to Rs 557.7 crore, reflecting incremental gains despite a competitive media and connectivity landscape.

Profitability improved on the back of disciplined cost control and higher contribution from associates. Profit before tax increased to Rs 28.2 crore, up from Rs 19.1 crore in Q3 FY25, aided by Rs 3.9 crore in share of profit from associates and joint ventures. After tax, earnings for the quarter climbed nearly 60 per cent year-on-year.

Over the nine months ended December 31, 2025, Hathway reported a net profit of Rs 71 crore, compared with Rs 57.7 crore in the corresponding period last year. Total income for the nine months came in at Rs 1,677.3 crore, up from Rs 1,599.8 crore, while profit before tax rose to Rs 94.7 crore from Rs 84.2 crore.

A closer look at the segments shows a familiar split story. The cable television business remained under pressure, reporting a segment loss of Rs 11.4 crore for the quarter, though this narrowed sharply from the Rs 16.6 crore loss seen a year ago. In contrast, the broadband business returned to the black, delivering a modest but positive contribution of Rs 4.2 crore, helped by associate income. Dealing in securities continued to be a bright spot, generating Rs 14.7 crore in quarterly profits.

Costs stayed broadly contained. Pay channel costs, the single largest expense, rose to Rs 287.4 crore, while depreciation and amortisation stood at Rs 74 crore. Finance costs remained negligible at Rs 0.2 crore, keeping leverage risks in check.

Hathway’s earnings per share for the quarter improved to Rs 0.12, up from Rs 0.08 a year ago. The company maintained a strong balance sheet, with total assets of Rs 5,302.4 crore and total liabilities of Rs 848.9 crore as of December 31, 2025.

While structural challenges persist in the traditional cable business, the numbers suggest Hathway is slowly recalibrating its mix trimming losses where needed, leaning on associate income, and keeping the broadband engine ticking. For now, the company may not be racing ahead, but it is clearly staying tuned in to profitability.

Cable TV

Signal drop Tejas Networks’ numbers stay patchy in a volatile quarter

Published

4 weeks ago

January 10, 2026

indiantelevision.com Team

MUMBAI: In telecom, even the strongest signals face interference and Tejas Networks Limited’s latest numbers show just how noisy the airwaves remain. The Tata Group-backed networking firm reported unaudited standalone revenue of Rs 305.72 crore for the quarter ended December 31, 2025, up sequentially from Rs 261.37 crore in the September quarter, but sharply lower compared with the Rs 2,642.05 crore clocked in the year-ago period. The topline recovery, however, was overshadowed by a pre-tax loss of Rs 303.20 crore, widening from a Rs 473.03 crore loss in the previous quarter, and reversing a Rs 211.06 crore profit reported in the December 2024 quarter.

After tax, the company posted a loss of Rs 196.89 crore for Q3 FY26, compared with a loss of Rs 307.17 crore in Q2 FY26 and a profit of Rs 165.42 crore a year earlier. For the nine months ended December 31, 2025, Tejas Networks reported revenue of Rs 769.02 crore and a loss after tax of Rs 697.97 crore, a sharp swing from a Rs 512.67 crore profit in the corresponding nine-month period last year. The numbers reflect a year marked by execution challenges rather than demand collapse.

Costs remained the dominant spoiler. Total expenses for the December quarter stood at Rs 616.50 crore, driven by elevated material costs, employee expenses and provisioning. The company also flagged several one-offs and adjustments: a Rs 9.85 crore provision linked to the implementation of new labour codes, ₹24.35 crore in warranty provisions, and reversals related to inventory obsolescence. Earlier quarters had already absorbed heavy charges tied to contract manufacturing losses, design changes and write-downs, the hangover from which continues to weigh on profitability.

Tejas reiterated that it operates as a single reportable segment focused on telecom and data networking products and services, offering little insulation from sector-wide volatility. While revenue momentum has stabilised sequentially, the contrast with the previous financial year remains stark. For context, the company closed FY25 with audited standalone revenue of Rs 8,915.73 crore and a profit after tax of Rs 450.66 crore, underscoring how sharply the operating environment has shifted in FY26.

The results were reviewed by the audit committee and approved by the board on January 9, 2026, but they leave investors with a familiar question: when does recovery turn structural rather than episodic? For now, Tejas Networks appears to be in reset mode, balancing execution clean-up with cost discipline. In a sector where margins can be as fragile as fibre strands, the next few quarters will matter as much as the signals the company sends to the market.