ITV

Category: Cable TV

  • MSOs feel the heat in Kolkata

    MSOs feel the heat in Kolkata

    KOLKATA: It seems to be a really difficult time for the multi system operators (MSOs) in Kolkata. We have learnt that Kolkata Cable & Broadband Pariseva Ltd has been asked to pay a hefty amount to the government authorities as it has been avoiding the tax payment for quite some time.

    In another case, former CEO and managing director of Digicable Comm and now the head of the Kolkata operations of Hathway, Amit Nag, who was recently denied anticipatory bail by the Supreme Court, is allegedly untraceable. Sources indicate that the investigation may reach some other senior officials in the national MSO if he does not show up.

     
    Last week indiantelevision.com reported that two officials from Kolkata Cable & Broadband Pariseva Ltd – managing director Bijoy Kumar Agarwal and director Prasun Kumar Das – were arrested as the firm had not paid service tax to the tune of Rs 5.52 crore to the government exchequer.

    According to sources, the company has not paid the tax even after regularly collecting it from consumers and thus it has now been asked to pay around Rs 11-13 crore including the fine in the next 20-25 days.

    In the case of Nag, we have learnt that the national multi service operator Digicable had lodged an FIR against Nag alleging misuse of position and sharing of confidential data and digital materials like set top boxes and fibre optic wires.

    Siticable Kolkata director Suresh Sethia disclosed that Nag had allegedly deleted some sensitive data even when he was with Indian Cable Network Co (a Siticable affiliate in Kolkata) and now he has done the same with Digicable.

    Apparently, Nag had applied for a bail plea which was also rejected by division bench of Calcutta High Court.

    Sethia says: “We had filed a case against him on 1 January 2010 for deleting sensitive data like line diagrams and sharing of confidential data with competitors. Digicable has also complained of the same offence. In our case, the charge sheet was already filed in April 2013. In case of Digi, his bail request is cancelled and now he is absconding.”

    All this seems to be turning against the MSOs as the business community has even got a warning from the finance minister P Chidambaram that the government may arrest and prosecute the ‘chronic’ service tax evaders.

  • LCOs may decrease in number in the next three years

    LCOs may decrease in number in the next three years

    KOLKATA: Lately,  indiantelevision.com  has done a series of reports about local cable operators (LCOs) being unhappy with the process of digitisation. A critical area of concern being the Telecom Regulatory Authority of India’s (TRAI) ruling on consumer application forms (CAFs) and billing, which according to LCOs, makes multi system operators (MSOs) the owners of their hard-won subscribers.

    On the back of these reports comes another disturbing finding: experts say LCOs in the city’s DAS area – currently pegged at 7,000 to 8,000 – will drastically decrease in numbers in the next three years.

    Says Mrinal Chatterjee, who runs Akash Sutra, a cable network in Bangur and its adjoining areas: “During analogue times, the share between the MSOs and us used to be 20:80 but after DAS, it has come down to 65:35. The business model is not at all lucrative enough. A major number of operators might look at other options for existence.” Many others are thinking of ways to ‘only exist’ in the cable TV business, wherein they have invested nearly 20 years of their life; he adds.

    Whereas, Suresh Sethia, Siticable Kolkata director says: “Small operators will become a part of larger networks but will still be in business.” Asked to define the term ‘small operators’ Sethia goes on to explain that LCOs with 100-150 subscribers are small while those with 2,000 and more customers are big. “There are groups of LCOs having more than 10,000 subscribers that are considered large,” he says.

    Sources however say that in Kolkata, most cable ops are yet to sign revenue-sharing agreements with their MSOs.

    An MSO says while the company has asked affiliated LCOs to educate subscribers about the different packages on offer, LCOs are not doing their work. “Secondly, the LCOs did not pay us for each connection in the analogue regime. But with installed set top boxes and the number of connections transparent, LCOs are not supporting us properly implement the new system,” he says.

    By contrast, an LCO who is part of the recently formed Bengal Broadband initiative (GIVE LINK TO OUR STORY) argues: “A multi system operator may provide cable TV services directly to subscribers. They don’t need our services and we are not mere collection agents. So, I will try to become a MSO.”

    Another cable op questions: “Filling up forms to gather information about viewers’ preferences coupled with sharing of network could result in monopoly of MSOs. Where are we in the system?”

     

    According to Swapan Chowdhury, convener of the Cable Operators Digitalisation Committee of the Association of Cable Operators, the authorities must do something in favour of operators. But he is quick to assure that people who have spent years in this industry will be here and ‘nothing will change’.

    Corpus Media consultant GK Viswanath corroborates Chowdhury’s view and says: “LCOs will not leave the industry. They’ve spent time and money here. LCOs will be the franchisees or payment collectors.” Going forward, he feels the small LCOs will merge with the MSOs and not with big LCOs.

  • MCOF to meet MSOs to discuss billing issues

    MCOF to meet MSOs to discuss billing issues

    MUMBAI: The easier a process becomes, the better it is. It seems this is the process that Maharashtra Cable Operators’ Foundation (MCOF) has opted for in order to make the entire digitisation process a smooth ride. In a new initiative, the apex body of cable operators in Maharashtra has sent a letter to all the MSOs inviting them to a meeting where they would discuss about the proper implementation of digitisation.

     

    In the letter, of which Indiantelevision.com has a copy, the MSOs have been requested to schedule the meeting in the coming week.

     

    When both the parties meet, they are expected to discuss issues related to: interconnect agreement, billing, Consumer Application Form (CAF), package activation, a la carte channels choice, disconnection of set top boxes (STBs) without notice, misleading and false  information given about the LMO to the customer over call center, ownership of STB and uniform rates.
    We are making an effort from our side to meet each MSO separately, says Arvind Prabhoo

     

    The letter has come out a day after the Telecom Regulatory Authority of India (TRAI) gave the MSOs the final deadline of 15 December to submit the duly filled CAFs and also implement gross billing by December.  “CAF is not the only issue, there are issues related to service tax and billing,” says MCOF president Arvind Prabhoo.  “There is no clarity on whether the consumers will be billed on the service provided by the MSO or on the MRP of the package that the subscriber opts for,” he adds.

     

    The meeting has been called to discuss the issues concerning both the MSOs and the LMOs.

     

    “We are making an effort from our side to meet each MSO separately. In the meeting, we will try and understand the system of billing devised by the MSO and make suggestions, if required. If not, we will go hand-in-hand with MSOs, provided our legal status is maintained,” informs Prabhoo.

     

    The apex body which comprises more than 1500 LMOs is also unsure about the settlement mechanism between the MSO and the LMO once the billing is done. “The MSOs so far haven’t spoken to the LMOs on how they will pay the LMO for the customer it bills,” points out Prabhoo.

     

    Expressing concern on the 15 December deadline set for submitting CAFs, Prabhoo says, “If 50 per cent CAFs have been filled in one year on an average, how does TRAI expect the remaining 50 per cent to be filled in next three weeks? Also, with the holiday season coming in, is TRAI looking at switching off STBs, if the deadline is not met?”

     

    With TRAI pushing MSOs to start gross billing from December, Prabhoo comments, “The issue relating to entertainment tax is subjudiced. So when the MSO says it will start gross billing from next month, is it looking at levying entertainment tax as well?”

     

    It should also be noted that the Nasik Cable Operators Association has moved the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) on billing. While TRAI was supposed to respond to it on 22 November, the tribunal has granted time till 23 January to the regulator to respond. “So when both entertainment tax and billing is subjudiced, why is TRAI pushing cable operators for contempt of court?” he questions.

     

    On the issue of TRAI asking the MSOs to either convince the LMOs to start billing or do it themselves, Prabhoo sternly says, “They can do it, if they want. We are not going to be delivery boys. We are owners of our own businesses. And we have the right to bill our own consumers and that is what we are fighting for.”

  • MSO MD, director behind bars for not paying service tax

    MSO MD, director behind bars for not paying service tax

    KOLKATA: Two officials of a Kolkata-based multi service operator (MSO) Kolkata Cable & Broadband Pariseva Ltd were arrested today, as the firm had not paid service tax to the tune of Rs 5.52 crore to the government exchequer.

    The arrest of the two officials of Kolkata Cable & Broadband Pariseva Ltd came close on the heels of Union Finance Minister P Chidambaram’s visit to the city two days ago.

    Talking tough, Chidambaram on Tuesday warned the business community here that the government would use provisions of arrests and prosecutions against ‘chronic’ service tax evaders.

    KK Jaiswal, service tax commissioner of Kolkata, on Thursday said two persons, namely Bijoy Kumar Agarwal, managing director, and Prasun Kumar Das, director of Kolkata Cable & Broadband Pariseva Ltd, were arrested.

    “The firm, engaged in providing service as an MSO, is collecting service charges regularly. Investigation revealed that they have collected service tax around Rs 5.52 crore, but have not deposited the same to the government. This is a cognizable offence and punishable upto seven years of imprisonment. Both the persons have been produced before the Alipore Court,” Jaiswal addressed at a media interaction.

    He said the amount of tax was due for the period of 2008-09 to 2012-13.

    “Steps are being taken to recover the amount,” Jaiswal added.

    Earlier, Chidambaram said the government had arrested 13 people across the country in connection of tax evasions.

  • 100 Kolkata LCOs group to set up a new headend

    100 Kolkata LCOs group to set up a new headend

    KOLKATA: One would imagine that cable operators would be a happy lot, considering the country is on the threshold of the last two phases of digitisation. However, the truth is LMOs (last mile operators) or LCOs are unhappy with the Telecom Regulatory Authority of India (TRAI) ruling on consumer application forms (CAF) and billing, which according to them, makes multi system operators (MSOs) the owners of consumers.

    Earlier this week, indiantelevison.com reported how a group of LCOs and independent MCOs met the Parliamentary Committee on Information and Technology in New Delhi to put forth their views on the subject.

    The latest, sources reveal, is that around 100 Kolkata-based LCOs – some affiliated with Siticable, others with Manthan – have come together and invested between Rs 2 and Rs 3 crore toward setting up a headend and accompanying infrastructure at Salt Lake College More in the city.

    This group is believed to be in the process of setting up a cooperative venture and is eager to start its own services. With the LCOs’ rising concern over MSOs becoming the owners of their hard-won subscribers, the development does not come as a surprise to the industry.

    However, “MSOs are creating hurdles for these LCOs,” sources added, without divulging any details.

    Swapan Chowdhury, convener of the Kolkata Cable Operators Digitalisation Committee of the Association of Cable Operators confirmed that this new cooperative had indeed been formed and that the LCOs might name the service Bengal Brand. “It is a difficult time for LCOs in Kolkata as the MSOs are not allowing them to go ahead with their plans,” he said.

    Rajiv Sharma, lead analyst (telecom and media), HSBC Securities, opined: “The local cable operators are also thinking of becoming MSOs by coming together… Not good news for the stock prices of existing MSOs which have raised funds from the public even if LCOs fail eventually.”

    Namit Dave, cable TV analyst, stated that bunching together was probably a good option for smaller operators. “A 200 channel headend costs nearly Rs 1 crore; a smaller operator with subscribers running into a few thousands would not find the investment profitable in a small town. However, if operators were to get together, it could end up being a profitable venture,” he pointed out.

    Kolkata-based Manthan Broadband Services director Sudip Ghosh sees more cable ops coming together in east India. Says he: “Players with a subscriber base of more than 500,000 may not consolidate headends. But Kolkata can see the consolidation of players with others having a subscriber base of around 300,000-400,000.

  • Sky adds 4oD catch-up service to NOW TV Box

    Sky adds 4oD catch-up service to NOW TV Box

    MUMBAI: Channel 4’s 4oD has become the latest terrestrial catch-up TV service to launch on Sky’s NOW TV Box, which already offers access to BBC iPlayer and Channel 5’s Demand 5.

    Shows such as Homeland, Marvel’s Agents of S.H.I.E.L.D. and Made in Chelsea as well as box sets from classic series such as Black Books, Father Ted and Peep Show are now available on demand for owners of the NOW TV Box. This adds more than 3,000 hours of content to the service for customers to enjoy at no extra cost. NOW TV also offers catch-up entertainment from Sky Atlantic, Fox, Discovery and Comedy Central.

    NOW TV director Gidon Katz commented in a report: “The NOW TV Box provides millions of people with the opportunity to transform their regular TV into a Smart TV for less than a tenner. There is now even more to watch. The launch of 4oD means the NOW TV Box delivers an even bigger choice of on-demand TV. It’s available alongside flexible pay-as-you-go access to must-see sport, the latest movies you missed at the cinema and the TV shows everyone’s talking about. Offering convenient, contract-free accesses to such outstanding content, no wonder that NOW TV Boxes have been flying off the shelves.”

    Channel 4 director of commercial and business development Laurence Dawkin-Jones added: “Bringing 4oD on the NOW TV Box represents the latest device launch in a busy year for Channel 4 that has seen us extend our content reach to many new platforms. We’re always looking for new places we can ensure our viewers can enjoy our popular on-demand service, and are delighted to add this to the portfolio.”

  • LCOs demand access to SMS from MSOs

    LCOs demand access to SMS from MSOs

    KOLKATA: The process of shifting from analogue to digital feed is not without its share of problems; a key issue being the resultant tug-of-war between local cable operators (LCOs) and multi system operators (MSOs) over access to the subscriber management system (SMS).

    The Digital Addressable Cable TV Systems (DAS) requires MSOs to establish a subscriber management system (SMS), where details of all subscribers, along with their choice of services including channels and bouquets, are maintained.

    While cable and entertainment analysts feel, “This brings in addressability and consequently, complete transparency in the whole system,” LCOs have a different take on the matter. They are of the opinion that once MSOs start billing consumers directly, they may end up losing control over their hard-won subscribers. Hence, they’re now asking MSOs to allow them access to the SMS to avoid such an eventuality.

    Says Rajiv Sharma, lead analyst (telecom and media), HSBC Securities: “LCOs are worried about losing control over their subscribers if MSOs bill directly. They are of the view that MSOs should allow LCOs access to subscriber management systems, which are similar to what is being done for airline ticketing.”

    A city-based cable op told indiantelevision.com, on condition of anonymity, that he had worked very hard for the last 20 years and it would be very unprofessional if his business and database were to go out of his hand and to the MSO whom he would then have to depend on totally.

    Meanwhile, an MSO questioned as to how he could allow LCOs access to the SMS which his company had spent a few crores on. Typically, it’s the MSOs that invest in infrastructure including network, encryption, ERP, call centers and SMS.

    Director Manthan Broadband Services pointed out the benefits of SMS as enabling subscribers exercise their choice of services and budget their bills accordingly. “It also helps us in managing their accounting and billing of the services rendered effectively in the long term,” said he.

    Cable analyst Namit Dave suggested that MSOs and LCOs should work hand-in-hand for mutual benefit. While Sharma pointed out that the battle between MSOs and LCOs was sending out wrong signals to the investor community. “Gross billing remains a deterrent for MSOs and we anticipate some delay as we don’t expect clarity on the entertainment tax issue anytime soon,” he said. News is Hathway has suggested it expects to move to gross billing not before phase I i.e. the fourth quarter of the current fiscal.

  • Kolkata cable ops to meet FM

    Kolkata cable ops to meet FM

    KOLKATA: With cable operators liable to pay 12.36 per cent of the subscription amount collected per month from customers as service tax to the government, 12 cable ops met the finance minister P Chidambaram in the city today to talk on Voluntary Compliance Encouragement Scheme (VCES).

     

    Two months ago, indiantelevision.com was the first to report issuing of summons to over 350 city-based cable ops for evasion of service tax for the past five years. We had also reported how service tax officials conducted two raids to probe into alleged financial irregularities of two MSOs.

     

    This, despite the government having introduced the VCES on 10 May. VCES is a one-time amnesty scheme for paying service tax dues for the said five-year period from 1 October 2007 to 31 December, 2012, without any interest or penalty.
    Cable Operators Digitalisation Committee of the Association of Cable Operators convener Swapan Chowdhury, confirmed the news saying: “We will discuss the voluntary service tax with the minister.”

     

    A key issue the cable ops plan to discuss is the government’s U-turn on the proposed service tax waiver for operators with turnover of less than Rs 10 lakh per annum. With authorities now saying that as cable ops are selling brands like Manthan and Siticable, they are liable to pay service tax, irrespective of the turnover shown in books, Chowdhury stressed: “We requested the government not to include operators below Rs 10 lakh turnover for service tax payment.”

     

    As the secretary of Cable and Broadband Operators’ Welfare Association, Chowdhury also informed the finance minister that after implementation of DAS in the city, consumers have had to wait for bills and upon not receiving them, remained unwilling to pay service tax to the LCOs.

     

    About the amnesty scheme, which Chidambaram has been urging service tax defaulters to take advantage of, tax consultant Namit Dave said: “By giving up interest, the government wants people to clear their dues.”
    Meanwhile, an industry analyst opined that MSOs which have evaded service tax to the tune of Rs 15 crore to Rs 20 crore in the past four years, now have a chance to pay their dues without penalty and prosecution.

  • Comcast, TWC likely to close acquisition deal

    Comcast, TWC likely to close acquisition deal

    MUMBAI: Time Warner Cable and Comcast Corp are likely to close an acquisition deal that could be worth $58 billion. It is learnt that the duo are in informal discussion for the same.

     

    Several pay TV operators have showed interest in acquiring Time Warner Cable. While so far it was Charter Communications that was eyeing the operator, now several media reports are hinting towards a possible acquisition by Comcast.

     

    Charter has been on the hunt for an acquisition, as John Malone, who controls 27 per cent in the company through Liberty Global, looks to bootstrap Charter’s growth. With 4.3 million subscribers, mergers and acquisitions has become an ongoing strategy for Charter. It should be noted that earlier in the year, Charter bought Optimum West from Cablevision for $1.6 billion.

     

    Media reports suggest that Comcast and Charter could, however, buy Time Warner Cable together, and divide its holdings, as they did with Adelphia Communications back in 2006. Comcast could take the New York City operation and gain a more valuable presence there, while Charter could gain dominance in LA.

     

    Consolidation in the cable industry is likely as MSOs look to gain enough size to have a card to play against content owners regarding programming costs considering that no media company could be economically viable if they lose 33 per cent of the country’s pay-TV subscribers.

     

    One way or another, TWC will likely be bought by someone. It lost 306,000 video subscribers in the third quarter after a month-long blackout of CBS and Showtime in a retransmission dispute.

     

    TWC currently has 11 million customers, and Comcast has 21 million; together, they would serve about a third of the nation’s pay-TV subscribers.

  • LCOs, independent MSOs unhappy with digitisation

    LCOs, independent MSOs unhappy with digitisation

    MUMBAI: Back in 2012, when India kicked-off the process of digitisation, local cable operators (LCOs) were an unhappy lot; approaching state high courts for respite from what they perceived as a threat to their business.

     

    Today, one would imagine cable ops to be happy, considering the first two phases of DAS are almost complete and India is on the threshold of the final phases (III and IV) of the big switch (analogue to digital feed).

     

    However, the truth is: cable ops are not happy with the Telecom Regulatory Authority of India (TRAI) ruling on consumer application forms (CAF) and billing, which according to LCOs, makes multi system operators (MSOs) owners of consumers. In this connection, a group of LCOs and independent MSOs met the Parliamentary Committee on Information and Technology in New Delhi and put forth their views.

     

    ABS 7 Star CMD Atul Saraf told the committee: “The ownership of the consumers should be with the LCOs and not with the MSOs. The TRAI and the Information and Broadcasting Ministry (I&B Ministry) should amend the DAS rules keeping in mind the interest of all stake holders.”
    Almost 90 per cent of the STBs are imported from China, we propose that 70 per cent of the STBs should be Indian, says Atul Saraf

     

    Saraf pointed out that though there were 60,000 LCOs and 8,000 MSOs across the country, the task force formed for the process did not include a single LCO or MSO. “A new task force should be formed with all stake holders and not a couple of MSOs and broadcasters who are in vertical monopoly,” he remarked.

     

    Drawing attention to the low quality of the Chinese set top boxes (STBs) being used, he said cable ops who had already spent close to USD 4 billion in the first two phases would be forced to spend another USD 4-5 billion in the last two phases of DAS. “Currently, most of the STBs being seeded are Chinese. The boxes which are of low quality may have to be replaced in the next couple of years, which means more cost for the operators,” Saraf said, cautioning against implementing phases III and IV before the completion of the first two phases.

     

    “There should be a Broadcast Act to monitor broadcasters. Also, only after both the consumers and cable operators reap the benefits of DAS phase I and II, phase III and IV should be implemented,” he said.

    Increasing import duty on STBs will discourage the MSOs from importing STBs from China, points Arvind Prabhoo

     

    On behalf of the cable op community, Saraf demanded: “We want the committee to question the government as to why these loopholes were not looked at before importing such STBs,” pointing toward the growing need for indigenous box manufacturing. “Currently, almost 90 per cent of the STBs are imported from China; we propose that 70 per cent of the STBs should be Indian,” said he.

     

    He proposed that while the current import duty on STBs is 10 per cent, it should be raised to 50 per cent. “Wasn’t digitisation meant to uplift Indian STB manufacturers and also create more jobs for them? What I fail to understand is how the TRAI and I&B Ministry did not see these loopholes before implementing digitisation,” Saraf questioned.

     

    Seconding Saraf on the hike in import duty as well as indigenous manufacture of STBs was Maharashtra Cable Operators Federation president Arvind Prabhoo. “Of course, importance should be given to the national STB manufacturers. If the import duty is increased, it will surely discourage the MSOs from importing STBs from China and also encourage Indian manufacturers. That digitisation should have helped generate revenue and employment for Indians, are issues the government should have thought about,” he said.
    We plan to go and meet the members of parliament once the winter session commences,says Pramod Pandya

     

    He opined that the government had been misled at some point. “I think that a certain section of the industry presented a wrong picture to the government. But, I am sure they will work on it now.”

     

    Gujarat Cable Operators Association president Pramod Pandya wanted to know if any consumer survey had been conducted before implementing digitisation. “I do not understand the need to force the implementation of DAS, if the country doesn’t have infrastructure to support it,” he thundered, pointing out that cable ops are hopeful the Broadcast Bill will be proposed during the winter session of the Parliament. “We plan to go and meet the members of parliament once the winter session commences,” he rounded off.