ITV

Category: Cable TV

  • Delay in Phase III monetisation likely to disturb profitability of MSOs: ICRA

    Delay in Phase III monetisation likely to disturb profitability of MSOs: ICRA

    MUMBAI: In the cable TV space, in the current fiscal the revenue growth of multiple system operators (MSOs) will remain sensitive to regulatory changes, says ICRA. While lifting of stay orders and consequent discontinuation of analog signals in Phase III markets will remain a key subscription revenue growth driver, any extension with respect to Phase IV deadline (beyond December 31, 2016) will impact the activation revenues.

    With an estimated population of over 60 million households in Phase IV markets, cable TV players do not anticipate any extension in Phase IV deadline. However, the implementation is expected to be along the experience of Phase III, with analog signals being discontinued in a phased manner. Of the analog population in Phase III and Phase IV markets, residual analog subscriber base amongst the top three MSOs stood at ~9.5 million subscribers only (as on March 31, 2016), against a total analog population of over 6 0 million in the country, indicating healthy growth opportunities for DTH operators and regional MSOs. In this direction, DTH operators have introduced lower priced vanilla STBs and channel packages to tap the opportunity in Phase IV markets; however, DD Free Dish is also expected to emerge as a key player in Phase IV, given the price sensitive nature of subscribers.

    “Over the last few years, market leaders in the cable TV space have adopted an inorganic growth strategy for entering new geographies and increasing their subscriber universe, consolidation in the cable TV space is expected to continue as MSOs look at further strengthening their market position in their respective geographies,” says ICRA Ratings SR GVP Subrata Ray.

    While the overall placement revenues are expected to remain buoyant, driven by new channel launches and the inclusion of tier II and tier III markets in audience measurement metrics; some correction on account of the change in the nature of content deals (net of placement revenues) with larger broadcasting networks is anticipated. While the subject of discontinuation of analog signals in Phase III markets remains under litigation, monetisation of the Phase III markets is expected to get deferred by nearly a year before the benefits of the healthy STB seeding, achieved in Phase III markets, start percolating.

    “In view of the potential delays in Phase III monetisation, ability of the MSOs to improve cost efficiencies and ARPUs from Phase I and Phase II markets remains crucial to support the profitability metrics in the current fiscal,” says Ray.

    During this transition phase, the cash accruals of MSOs are expected to improve gradually as incremental capex requirements are likely to remain low.

    “The capex outlay of MSOs over the medium term will be driven towards achieving higher broadband penetration in identified markets; investments in LCO management and improving penetration of value-added services such as HD channels and Video-on-Demand in digitised markets. In addition, replacement capex for STBs seeded in Phase I and Phase II markets will also drive the investment requirements of MSOs over the medium term,” adds Ray.

  • Delay in Phase III monetisation likely to disturb profitability of MSOs: ICRA

    Delay in Phase III monetisation likely to disturb profitability of MSOs: ICRA

    MUMBAI: In the cable TV space, in the current fiscal the revenue growth of multiple system operators (MSOs) will remain sensitive to regulatory changes, says ICRA. While lifting of stay orders and consequent discontinuation of analog signals in Phase III markets will remain a key subscription revenue growth driver, any extension with respect to Phase IV deadline (beyond December 31, 2016) will impact the activation revenues.

    With an estimated population of over 60 million households in Phase IV markets, cable TV players do not anticipate any extension in Phase IV deadline. However, the implementation is expected to be along the experience of Phase III, with analog signals being discontinued in a phased manner. Of the analog population in Phase III and Phase IV markets, residual analog subscriber base amongst the top three MSOs stood at ~9.5 million subscribers only (as on March 31, 2016), against a total analog population of over 6 0 million in the country, indicating healthy growth opportunities for DTH operators and regional MSOs. In this direction, DTH operators have introduced lower priced vanilla STBs and channel packages to tap the opportunity in Phase IV markets; however, DD Free Dish is also expected to emerge as a key player in Phase IV, given the price sensitive nature of subscribers.

    “Over the last few years, market leaders in the cable TV space have adopted an inorganic growth strategy for entering new geographies and increasing their subscriber universe, consolidation in the cable TV space is expected to continue as MSOs look at further strengthening their market position in their respective geographies,” says ICRA Ratings SR GVP Subrata Ray.

    While the overall placement revenues are expected to remain buoyant, driven by new channel launches and the inclusion of tier II and tier III markets in audience measurement metrics; some correction on account of the change in the nature of content deals (net of placement revenues) with larger broadcasting networks is anticipated. While the subject of discontinuation of analog signals in Phase III markets remains under litigation, monetisation of the Phase III markets is expected to get deferred by nearly a year before the benefits of the healthy STB seeding, achieved in Phase III markets, start percolating.

    “In view of the potential delays in Phase III monetisation, ability of the MSOs to improve cost efficiencies and ARPUs from Phase I and Phase II markets remains crucial to support the profitability metrics in the current fiscal,” says Ray.

    During this transition phase, the cash accruals of MSOs are expected to improve gradually as incremental capex requirements are likely to remain low.

    “The capex outlay of MSOs over the medium term will be driven towards achieving higher broadband penetration in identified markets; investments in LCO management and improving penetration of value-added services such as HD channels and Video-on-Demand in digitised markets. In addition, replacement capex for STBs seeded in Phase I and Phase II markets will also drive the investment requirements of MSOs over the medium term,” adds Ray.

  • S.N. Sharma quits Reliance

    S.N. Sharma quits Reliance

    MUMBAI: Cable distribution veteran SN Sharma has quit Reliance Jio, a subsidiary of Mukesh Ambani promoted Reliance Industries Ltd (RIL).

    Sources in RIL confirmed that Sharma has put in his papers last week.

    Sharma had joined RIL’s media-cum-telecom venture Reliance Jio in 2015  and was brought on board to lead the cable distribution business of the organisation.

    RIL, which through a subsidiary company has a licence to operate as an MSO, had also brought in former Hathway Datacom chief executive K. Jayaraman to head its distribution business and Sharma reported into him.

    As part of  Reliance Jio, Sharma and Jayaraman were entrusted to build a business plan for distribution of TV channels owned by Reliance that were managed under Network18 Media and Investments Ltd.

    With an experience of more than 20 years in electronic media and cable distribution, Sharma is credited with playing a crucial role in building thw Sameer Manchanda-promoted Den Networks and Rahejas-owned Hathway.

    RIL, which owns and controls the Network18 group that operates a clutch of TV channels, has widespread interest in media, telecom, petroleum and energy sectors.

    Through its subsidiary TV18 Broadcast Limited, the group operates news channels CNBC-TV18, CNBC Awaaz, CNBC Bajar, CNBC-TV18 Prime HD, CNN-News18, IBN7, ETV channels, IBN-Lokmat (a Marathi regional news channel in partnership with the Lokmat group), apart from the newly-launched  FYI TV18.

    TV18 also operates a joint venture with Viacom, called Viacom18, which houses a portfolio of popular entertainment channels like Colors, Colors HD, Colors Infinity, Rishtey, MTV India, MTV Indies, Comedy Central, Vh1, Nick, Sonic, Nick Jr, Teen Nick and Viacom18 Motion Pictures.

  • S.N. Sharma quits Reliance

    S.N. Sharma quits Reliance

    MUMBAI: Cable distribution veteran SN Sharma has quit Reliance Jio, a subsidiary of Mukesh Ambani promoted Reliance Industries Ltd (RIL).

    Sources in RIL confirmed that Sharma has put in his papers last week.

    Sharma had joined RIL’s media-cum-telecom venture Reliance Jio in 2015  and was brought on board to lead the cable distribution business of the organisation.

    RIL, which through a subsidiary company has a licence to operate as an MSO, had also brought in former Hathway Datacom chief executive K. Jayaraman to head its distribution business and Sharma reported into him.

    As part of  Reliance Jio, Sharma and Jayaraman were entrusted to build a business plan for distribution of TV channels owned by Reliance that were managed under Network18 Media and Investments Ltd.

    With an experience of more than 20 years in electronic media and cable distribution, Sharma is credited with playing a crucial role in building thw Sameer Manchanda-promoted Den Networks and Rahejas-owned Hathway.

    RIL, which owns and controls the Network18 group that operates a clutch of TV channels, has widespread interest in media, telecom, petroleum and energy sectors.

    Through its subsidiary TV18 Broadcast Limited, the group operates news channels CNBC-TV18, CNBC Awaaz, CNBC Bajar, CNBC-TV18 Prime HD, CNN-News18, IBN7, ETV channels, IBN-Lokmat (a Marathi regional news channel in partnership with the Lokmat group), apart from the newly-launched  FYI TV18.

    TV18 also operates a joint venture with Viacom, called Viacom18, which houses a portfolio of popular entertainment channels like Colors, Colors HD, Colors Infinity, Rishtey, MTV India, MTV Indies, Comedy Central, Vh1, Nick, Sonic, Nick Jr, Teen Nick and Viacom18 Motion Pictures.

  • MSO number touches 940 with forty more getting clearance in June 2016

    MSO number touches 940 with forty more getting clearance in June 2016

    NEW DELHI: As the country marches towards the deadline of the final phase which will complete cable digitlization all over the country, as many as forty multi-system operators have received provisional licences in June and taken the total to 711.

    Early this month, the government announced the cancellation of the permanent licence of one more MSO and the number of permanent licencees (up to ten years) fell by one to 229.

    The Information and Broadcasting Ministry had cancelled the licences of 27 MSOs and closed their cases by 2 June. In most of the other cases in the list of cancelled registrations, it is because of failure to get security clearance from the Home ministry. However, there are cases of many MSOs holding provisional licences not completing certain formalities relating to shareholders and so on.

    According to the latest list upto 28 June 2016, the area of operation of four MSOs have been revised after 2 June, one of which – Thamizhaga Cable TV Communication Pvt. Ltd, Chennai – has now got licence to operate pan-India barring the metros of Delhi, Mumbai and Kolkata. Chennai is in any case under stay following a court order after the first phase.

    Of the new licencees, three – Fastway Media Cable Network Pvt. Ltd of Delhi, Metro Trade Links of Bhopal, and Megbela Infitel Cable & Broadband Private Limited from New Delhi have got pan India licences.

    The other new registrations include the states of, or specific districts in, Arunachal Pradesh, Bihar, Uttar Pradesh, Haryana, Maharashtra, Odisha, Tamil Nadu, Uttarakhand, Rajasthan, Madhya Pradesh, Telangana, Gujarat, Karnataka, Chhatisgarh, and Andhra Pradesh.

    With the Home ministry directive about doing away with security clearances for MSOs not being communicated in writing to the MIB, the pace remains slow.

    The permanent licence issued to Kal Cable of Chennai had been cancelled on 20 August 2014, but this cancellation was set aside by Madras High Court on 5 September the same year. However, Kal Cable’s name continues to be in the cancelled list – presumably because the cases are still pending.

  • MSO number touches 940 with forty more getting clearance in June 2016

    MSO number touches 940 with forty more getting clearance in June 2016

    NEW DELHI: As the country marches towards the deadline of the final phase which will complete cable digitlization all over the country, as many as forty multi-system operators have received provisional licences in June and taken the total to 711.

    Early this month, the government announced the cancellation of the permanent licence of one more MSO and the number of permanent licencees (up to ten years) fell by one to 229.

    The Information and Broadcasting Ministry had cancelled the licences of 27 MSOs and closed their cases by 2 June. In most of the other cases in the list of cancelled registrations, it is because of failure to get security clearance from the Home ministry. However, there are cases of many MSOs holding provisional licences not completing certain formalities relating to shareholders and so on.

    According to the latest list upto 28 June 2016, the area of operation of four MSOs have been revised after 2 June, one of which – Thamizhaga Cable TV Communication Pvt. Ltd, Chennai – has now got licence to operate pan-India barring the metros of Delhi, Mumbai and Kolkata. Chennai is in any case under stay following a court order after the first phase.

    Of the new licencees, three – Fastway Media Cable Network Pvt. Ltd of Delhi, Metro Trade Links of Bhopal, and Megbela Infitel Cable & Broadband Private Limited from New Delhi have got pan India licences.

    The other new registrations include the states of, or specific districts in, Arunachal Pradesh, Bihar, Uttar Pradesh, Haryana, Maharashtra, Odisha, Tamil Nadu, Uttarakhand, Rajasthan, Madhya Pradesh, Telangana, Gujarat, Karnataka, Chhatisgarh, and Andhra Pradesh.

    With the Home ministry directive about doing away with security clearances for MSOs not being communicated in writing to the MIB, the pace remains slow.

    The permanent licence issued to Kal Cable of Chennai had been cancelled on 20 August 2014, but this cancellation was set aside by Madras High Court on 5 September the same year. However, Kal Cable’s name continues to be in the cancelled list – presumably because the cases are still pending.

  • Mauli Cable asked to pay Rs 15 lakh to Hathway at time of signing agreement

    Mauli Cable asked to pay Rs 15 lakh to Hathway at time of signing agreement

    NEW DELHI: Mauli Cable Network has been directed by the Telecom Disputes Settlement and Appellate Tribunal to pay upgront a sum of Rs 15 lakh to Hathway Cable and Datacom when signig a fresh interconnect agreement on 28 June at the office of the latter.

    The vacation bench of Member B B Srivastava in its order of 24 June 2016 noted that Mauli had not denied the amount of Rs 33,27,944 but that the invoice had been raised only on 6 June 2016.

    Listing the matter for 8 July 2016, the Tribunal said the balance would be paid within four weeks of its order.

    The Tribunal noted that Mauli was prepared to visit the office of Hathway on 28 June 2016 for signing a new agreement. It also noted that counsel for Hathway said that a representative of Mauli who had earlier turned up for this purpose without any authority to sign the agreement.

    Hathway told the Tribunal that it was providing the signals to Mauli for transmission, thereby answering the question raised by Mauli which had said it was not clear who the agreement was to be signed with.

  • Mauli Cable asked to pay Rs 15 lakh to Hathway at time of signing agreement

    Mauli Cable asked to pay Rs 15 lakh to Hathway at time of signing agreement

    NEW DELHI: Mauli Cable Network has been directed by the Telecom Disputes Settlement and Appellate Tribunal to pay upgront a sum of Rs 15 lakh to Hathway Cable and Datacom when signig a fresh interconnect agreement on 28 June at the office of the latter.

    The vacation bench of Member B B Srivastava in its order of 24 June 2016 noted that Mauli had not denied the amount of Rs 33,27,944 but that the invoice had been raised only on 6 June 2016.

    Listing the matter for 8 July 2016, the Tribunal said the balance would be paid within four weeks of its order.

    The Tribunal noted that Mauli was prepared to visit the office of Hathway on 28 June 2016 for signing a new agreement. It also noted that counsel for Hathway said that a representative of Mauli who had earlier turned up for this purpose without any authority to sign the agreement.

    Hathway told the Tribunal that it was providing the signals to Mauli for transmission, thereby answering the question raised by Mauli which had said it was not clear who the agreement was to be signed with.

  • Wadhwa says Siti Cable is continually looking for acquisitions

    Wadhwa says Siti Cable is continually looking for acquisitions

    MUMBAI: Siti Cable, part of the Essel group is not going to immediately get the benefits of the 100 per cent FDI relaxation in the TV distribution sector. This was revealed by Siti Cable executive director & CEO VD Wadhwa to TV channel Bloomberg TV a couple of days ago.

    Wadhwa said that the promoters own 71 per cent of Siti Cable Networks; with the non-promoter holding standing at 29 per cent. “At least for the next two to four quarters I don’t see any major benefits coming out to the government in terms of foreign currency inflows into the business,” he told Bloomberg TV.

    He added that the company would continue to grow both organically and inorganically in FY 2017. “The industry is going through a tight cash situation. The industry has largely been fragmented,” he stated. “Now consolidation is happening at the cable operator level, it is happening at the regional level. It is only a matter of time before it starts happening at the national level as well.”

    He revealed that his company was participating in the consolidation as post digitization it was becoming difficult for the cable operator to survive alone. “We are keeping our eye open because we have identified some of the geographies wherever we would like to expand by acquisition and wherever we see a strategic fit,” he explained.

    He pointed out to the network’s acquisitions recently in Maharashtra and Gujarat where Siti Cable was relatively weak.

    “In both these places we have expanded through partnerships. In Mumbai, we acquired 600,000 subscribers by acquiring 76 per cent in a local network Scod18. In Gujarat, we have acquired 700,000-800,000 subscribers by doing a 51:49 per cent joint venture in Gujarat,” he revealed.

    He said Siti Cable had agreed to take a 50 per cent stake in Assam-based Axom Communications as the existing promoter was comfortable in partaking of only that much equity. “The new Companies Act allows us to control an organization either through an equity stake or through the composition of the board. We chose to get a majority on the board and will be consolidating the results with Siti Cable’s financials on account of that,” he disclosed.

    Wadhwa explained that Siti Cable would be more open to taking anywhere between 51 per cent and 76 per cent stakes in cable TV ventures as it makes sense to have a partner who knows the local territory well to still be involved in the business even after acquisition or a partnership.

  • Wadhwa says Siti Cable is continually looking for acquisitions

    Wadhwa says Siti Cable is continually looking for acquisitions

    MUMBAI: Siti Cable, part of the Essel group is not going to immediately get the benefits of the 100 per cent FDI relaxation in the TV distribution sector. This was revealed by Siti Cable executive director & CEO VD Wadhwa to TV channel Bloomberg TV a couple of days ago.

    Wadhwa said that the promoters own 71 per cent of Siti Cable Networks; with the non-promoter holding standing at 29 per cent. “At least for the next two to four quarters I don’t see any major benefits coming out to the government in terms of foreign currency inflows into the business,” he told Bloomberg TV.

    He added that the company would continue to grow both organically and inorganically in FY 2017. “The industry is going through a tight cash situation. The industry has largely been fragmented,” he stated. “Now consolidation is happening at the cable operator level, it is happening at the regional level. It is only a matter of time before it starts happening at the national level as well.”

    He revealed that his company was participating in the consolidation as post digitization it was becoming difficult for the cable operator to survive alone. “We are keeping our eye open because we have identified some of the geographies wherever we would like to expand by acquisition and wherever we see a strategic fit,” he explained.

    He pointed out to the network’s acquisitions recently in Maharashtra and Gujarat where Siti Cable was relatively weak.

    “In both these places we have expanded through partnerships. In Mumbai, we acquired 600,000 subscribers by acquiring 76 per cent in a local network Scod18. In Gujarat, we have acquired 700,000-800,000 subscribers by doing a 51:49 per cent joint venture in Gujarat,” he revealed.

    He said Siti Cable had agreed to take a 50 per cent stake in Assam-based Axom Communications as the existing promoter was comfortable in partaking of only that much equity. “The new Companies Act allows us to control an organization either through an equity stake or through the composition of the board. We chose to get a majority on the board and will be consolidating the results with Siti Cable’s financials on account of that,” he disclosed.

    Wadhwa explained that Siti Cable would be more open to taking anywhere between 51 per cent and 76 per cent stakes in cable TV ventures as it makes sense to have a partner who knows the local territory well to still be involved in the business even after acquisition or a partnership.