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NEW DELHI: In the 2008-09 budget, the Union Finance Minister P Chidambaram has no major giveaway to the media and entertainment sector except in the areas of convergence and digitalisation. The budget has waived duties on the set-top boxes, giving a boost to the cable TV, direct-to-home (DTH) and IPTV operators. Chidambaram has also reduced duty on convergence products from 10 per cent to 5 per cent. Presenting the budget, Chidambaram said specific parts of STBs and specified raw materials for use in IT and electronic hardware industry have been fully exempted from customs duty. The minister also announced that to establish parity between devices used in the information/communication sector and the entertainment sector, he was reducing the customs duty on convergence products by half. While the announcement partly meets the demand by the Indian Broadcasting Foundation relating to STBs, it has failed to meet the long-standing demands of the film industry articulated through various organisations including Ficci and representations to the Information and Broadcasting ministry. Noting that India‘s music, literature, dance, art, cuisine and especially films are attracting huge interest around the world, Chidambaram announced a provision of Rs 750 million to the Indian Council of Cultural Relations to design and implement a programme to project these in a sophisticated and subtle manner. He described this as the ‘soft power‘ of India. In a move that may help the printing and newspaper industry, Chidambaram announced reduction of the excise duty from 12 to 8 per cent on “paper, paper board and articles made therefrom manufactured out of non-conventional raw materials by units not having an attached bamboo/wood pulp making plant.” There would be a further reduction on clearances up to 3,500 tonnes from 8 per cent to nil. Furthermore, the excise duty on certain varieties of writing, printing and packing paper will be reduced from 12 per cent to 8 per cent. |
Tag: cable
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STB duties waived, duty on convergence products cut to 5%
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Media Partners Asia: Cable the ultimate key to India’s broadband digital future
This is an executive summary of a Viewpoint Paper presented to the Prime Minister’s Office on 16 March 2007. The Paper was produced by research firm Media Partners Asia (MPA), and also supported by Liberty Global, Inc; Macquarie Media Group and Star Group.
The current cable industry, which already contributes 0.6 per cent directly to GDP, has the potential to increase this direct contribution exponentially, if it maximizes its broadband digital potential and attract investment. To do this, cable needs to be seen by the Government of India as the significant platform in the national economic context and as the key driving national broadband digital growth. Therefore, it needs higher priority in policy planning and a framework that allows it to maximize value.
Cable today in India is the dominant last mile pipe, connected to 20 million more homes than fixed line telephony. Cable TV already connects an estimated 71 million homes and almost 60 per cent of homes that own a TV set subscribe to cable TV, with India overtaking the US in 2006 to become the second largest Cable power in the world. Projected to further establish its status as the leading last mile network, cable will, serve more than 100 million TV homes by 2010. Its size and scale, if harnessed, presents a great opportunity to drive broadband digital deployment.
What is needed is an influx of capital an order of magnitude greater than currently exists. However, investors say that sentiment on broadband digital development in India is being somewhat dampened by the regulatory framework, which has grown too intrusive and harmful to long-term growth. As a result, investors are still cautious about funding long term broadband digital network upgrades when regulation imposes strict controls on the pricing of new capital intensive services. Concerns have intensified with the regulation for the deployment of digital conditional access systems or CAS in India. While all investors are agreed that CAS will provide a significant impetus to the deployment of broadband digital networks, they think it will work only in a less tightly regulated context.
Shane O’Neill, Chief Strategic Officer & Board Member, Liberty Global Inc., says: “The market is very attractive in terms of sheer size and growth potential but could be held back by ‘over regulation’ in key areas such as channel rate regulation, mandated revenue shares between industry participants and FDI caps. A lighter approach might be necessary to encourage the significant investment required to develop the broadband and digital industries both of which are very important for India’s future development.”
Alex Harvey, MD of Macquarie Media Group, adds, “We think India’s cable businesses, due to their ability to offer a range of converged services, will be material areas of growth and opportunity. A key element to realising these growth opportunities will be a transparent and proactive regulatory environment – this must be a priority area of government focus.”
Paul Aiello, the new CEO of STAR Group says: “The stakes are high for policymakers and the regulator to get it right, ensuring progressive policies that facilitate investment and growth.”
Investors are eyeing many deals in the cable broadband/digital space… one of the complications for some of the larger investor groups is how the current regulatory framework will play out – the current restrictions on revenue share, channel distribution and pricing are not optimal for investment, especially as there is no concrete signal was to when these restrictions will be lifted.
(The views expressed here are those of the author and Indiantelevision.com need not necessarily subscribe to the same.)
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Intelsat to distribute ViewAfrica, ViewAsia Networks programming
MUMBAI: Intelsat has announced that UK-based View Africa and ViewAsia Networks have launched two regional platforms on the Intelsat system, expanding their program offering in Africa and Asia.
Through its multi-year contract on the Intelsat 7 and Intelsat 10 satellites, ViewAfrica Network is distributing a free-to-air programming bouquet that now reaches all the Sub-Saharan countries with specific DTH focus on South Africa and Nigeria, and ViewAsia is distributing its programming into the cable headends of Asia.
ViewAfrica Network, uplinking out of Telemedia in South Africa, carries a free-to-air bouquet of religious programming that currently includes the following networks: Daystar, LoveWorld, Divine Truth Broadcasting and Emmanuel TV. ViewAfrica is among 27 DTH platforms built on the global Intelsat system.
Intelsat 7 provides video, direct-to-home and telecommunications services throughout Europe, the Middle East, Africa and Asia. Intelsat 10’s Ku-band payload contains multiple high-powered beams focused on Africa, Europe, India, the Middle East, Central and Western Asia as well as Northeast Asia.The beams on Intelsat 10 can be switched between the various regions, offering greater flexibility in the creation of new platforms for the delivery of video, data and IP-based services, a company release says.
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Neo Sports targets Pan Asian expansion by mid 2007
MUMBAI: Neo Sports has announced the details of its Pan Asian expansion as part of its mission to be a Pan Asian cricket channel by the middle of 2007. These markets include the Middle East, Bangladesh, Hong Kong, New Zealand, Sri Lanka and Nepal. Shortly, the cricket dedicated channel will also commence broadcasting in Malaysia and Singapore.
Neo Sports Broadcast Pvt Ltd CEO Shashi Kalathil said, “In barely three months of our commercial launch in India, we have succeeded in a comprehensive Pan Asian roll-out. Asia is a very important market for us as it is an amalgamation of cultures and nationalities with a huge Indian ethnic community.”
The revenues from the Pan Asian operations of Neo Sports outside India, between subscription and advertising are expected to add up to approximately $ 26 million in 2007-2008 with an approximately 30 per cent EBIDTA margin, as incremental cost for international operations is relatively insignificant since the bulk of the costs are already absorbed in the Indian operations, informs an official release.
Neo Sports was launched in Nepal through Pacific Traders on Cable and MMDS and has also partnered with the Pehla bouquet on the ADD platform in the Middle East, which is the pay TV platform management company in the Middle East, North Africa and Europe.
Neo Sports has also been launched on Cable in Bangladesh via SAARC Media in January 2007 and in Sri Lanka through Sri Lanka Broadband Network. In March 2007 Neo Sports will commence broadcasting on Hong Kong’s Cable system I-Cable and via DTH on One Broadcast Ltd, in New Zealand.
Neo Sports, which had its soft launch in October 2006 and its commercial launch in the first week of January 2007 in India, has secured platform partnerships across Asia, as part of its mission to be a Pan Asian cricket channel by the middle of 2007.
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FCC report suggests limiting of TV violence
MUMBAI: A new draft report from the US media watchdog the Federal Communications Commission (FCC) suggests the US government may be able to limit violence on TV in a way that does not violate the Constitution.
The long-overdue report suggests that Congress could craft a law that would let the agency regulate violent programming much like it regulates sexual content and profanity — by barring it from being aired during hours when children may be watching, for example.
An FCC official was quoted in media reports saying that violence could be treated similarly to broadcast indecency, with its airing prohibited during times when children might be watching.
However the official the FCC hasn’t officially adopted the findings of the draft report. Congress could order cable and satellite TV providers to allow viewers to buy channels individually or in family-friendly packages to limit how much violence children see.
The report had been requested by Congress. The report also suggests that cable and satellite TV could be subjected to an “a la carte” regime that would let viewers choose their channels.Citing studies, the draft says that there is evidence that violent programming can lead to “short-term aggressive behavior in children”.
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Nielsen Media Research launches Arianna Software in US
MUMBAI: Nielsen Media Research has released Arianna, a software tool used to analyse ratings data in local markets in the US.
The software will enable local clients to go beyond the reporting capabilities of existing software, and move into the arena of desktop data analysis. The version of Arianna can analyse metered market overnight ratings data for a single market.
The product will first be rolled out to Local People Meter markets – the ten markets that are currently metered by this technology and the three markets scheduled for 2007. Arianna will then be rolled out to the set meter markets during the first quarter of the year. A version for agency, rep firm, national broadcast and cable clients which includes a multi-market report, will be released later this year.
Arianna is the AGB Nielsen Media Research proprietary analysis software tool that is used by Nielsen Media Research under license. The AGB Group and Nielsen Media Research International formed a joint venture in August 2005 to offer television ratings in 30 countries under the AGB Nielsen Media Research brand name.
It is through an agreement with the JV that Nielsen Media Research can market Arianna, which was initially developed by AGB and modified jointly by the JV and Nielsen Media Research for the US market. Arianna is currently in use in 30 countries across four continents.
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Cisco offers debt to cable operators, pushes Scientific Atlanta STBs
MUMBAI: Cable operators dry of cash for digital implementation can now look forward to Cisco Systems, Inc. The global networking equipment and network management giant is willing to finance cable operators in India as it sees opportunity in riding the digital cable wave to push its set-top boxes (STBs).
There is a catch, though: operators will have access to the loan only if they use STBs from Scientific Atlanta, the company that Cisco acquired to bulk up on businesses that cater to consumers.
The debt will be provided through its wholly owned subsidiary company, Cisco Capital.
Cisco has approached several small and medium-sized operators in the Cas (conditional access system) areas, offering a variety of financing options. “We are willing to provide soft loans to cable operators which can be paid over a period of time. This way we can push our digital end-to-end solutions including headend, encryption system and boxes,” says a source in the company.
The loan size will depend upon the credit worthiness of the operator and the funding will be made available in phases. “We won’t be funding the cable network in one go, but infuse it in several doses,” says the source.
Cisco realises how tough it will be to evaluate the health of the cable networks. “Most of them do not have proper documents and it is difficult to rate their creditworthiness,” the source adds.
Among the cable operators Cisco has initiated talks are Kolkata-based Manthan and JPR Network, an independent operator in Mumbai. But there are no takers yet.
“We are more interested in equity than in debt. As we will have to subsidise the STBs, it will be very difficult to recover and repay the loan. The average revenue per user (ARPU) from Cas subscribers is also low. Besides, Scientific Atlanta boxes are more expensive than what is available in China and Korea,” says JPR Network promoter Raja Nadar.
Cisco, however, believes its end-to-end digital solutions and the pressure cable operators face to put quality infrastructure in place will drive in good business. “There is just a 20 per cent difference between what we provide and what others are offering. But we have a better system and bridge an end-to-end requirement,” the source says.
Rajan Raheja-promoted Hathway Cable & Datacom and Asianet are using the Scientific Atlanta headend, STBs and encryption system, the source adds. Hathway, in which Star has a 26 per cent stake, already has seeded Humax STBs and uses News Corp-owned NDS encryption systems.
For Hathway, Scientific Atlanta is going to be a second supply vendor as the market for digital cable expands.
Cisco acquired Scientific Atlanta so that it could tap the rapidly growing cable, satellite and IPTV markets across the world.
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Star operating profit down 36% in Dec 06 quarter
MUMBAI: In the first contraction in profit that Star has had since it began generating profits in early 2003, News Corp’s Asian arm has reported second quarter operating income down 36 per cent from the same period a year ago.
Though the quarter (up to 31 December 2006) saw growth in subscription revenues, it was more than offset by a decline in advertising revenue at Star Plus.
On the distribution side, the biggest initiative by Star India during the quarter was the $ 175 million deal with Nimbus to distribute its channels.According to Hong Kong-based Media Partners Asia (MPA), operating profit or EBIT (earnings before interest and taxes) was down 36 per cent year on year to under $ 30 million. Operating profit in the September 06 quarter was up 8 per cent YoY. MPA estimates for the first half of the year show operating profit down 28 per cent YoY to $41 million, MPA estimates.
A point of note of course is that the corresponding period in 2005 not only had the second season of KBC on Star Plus but also saw the first season of Nach Baliye on Star One providing a strong push to advertising sales revenues. Still, there is no getting away from the fact that softness in ratings at Star plus is also contributing to revenue declines.
Speaking about Star’s performance during a conference call with analysts after the announcement of News Corp’s results, president & COO Peter Chernin said: “When the third season (of KBC) did finally launch and the numbers were extremely strong, up more than 25 per cent over last year’s premier, which should give us great momentum for the second half of the year and lead to not only higher advertising results but higher ancillary revenues led by phone revenue from additional calls that come in with the show.”
Chernin also made a mention of the executive roiling that has been going on at Star when he said, “You’ve also read that we made some changes to senior management, changes which we think will strengthen our operations and improve our programming going forward.
“… I think we have aggressive expectations for Star. Beginning on India, we’d like to see continued growth in our channels. We expect the growth of Tata Sky (in which News Corp holds 20 per cent) to continue. I think the most significant impact digital (DTH, CAS) will have on the company is growth of revenues inside Star as we see additional subscribers and an ability to, you know, get higher declarations of subs from the cable/pay-TV operators. We’ll also see new channel launches there (Tata Sky), and also important new ancillary businesses in the Internet, production and movies, et cetera. So we’re optimistic about Star going forward in India. “
News Corp chairman Rupert Murdoch was equally gung ho about the expectations on the DTH front: “Tata Sky DTH in India at 500,000+ subscribers, will hit 1 million during 1H 07, adding 8,000 subs per day at peak levels, averaging about 5-6,000 per day. I’d just say that Tata Sky is [going] a lot faster than we had budgeted for.”
Commenting on the expectations from the rest of Asia, Chernin said, “Additionally, we’re also ambitious in other Asian countries, particularly Indonesia, where we’ve recently launched. We recently acquired a television network which we’re optimistic. A very big country. We’re hoping that could be the next India… and also just continuing growth in other territories, Taiwan, Hong Kong, China, and expanding into others.”
On the China side, Murdoch was almost diffident when he said: “We don’t do very well in China. We have an interest — we just sold half of it in Phoenix (China Mobile deal, $165 million sale). We’ve got more than our money back [in our] total investment and we’re still there. We brought in a new partner China Mobile [inaudible] relations and we think it will do nicely. And we have our own little channel, XK [Xing Kong], which is produced in Shanghai and distributed through the southeast. That’s pretty much a break-even operation.
“We are very [inaudible] all I would say there is that nobody and I challenge anyone to argue this, none of the leading American companies or British media companies have made any impact there yet. It’s possible that, I mean there MySpace finds room there… It may be a MySpace China, which we can license, but we’re just feeling our way there. It’s a vast market, but it’s certainly a very, very sensitive one and as we’ve seen what’s happened to Google there, what’s happened to eBay there, even to Yahoo. It is a very difficult market for outsiders.”
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PayMate partners OnMobile to allow consumers to pay bills via mobile phones
MUMBAI: In the era of digital services the mobile phone can well be referred as man’s best friend for the umpteen tasks it performs. Extending the benefits of this little gadget, mobile commerce solutions company PayMate has recently partnered with OnMobile, a value added services provider, to allow consumers to pay bills via mobile for services available on OnMobile powered voice portals and WAP sites such as Hutch, Airtel, Idea, Reliance, Tata, Fame Cinemas, Adlabs Multiplexes and the 505 platform.
Paymate customers will be able to pay via mobile while shopping, gifting, movie ticketing, airline ticketing and making bill payments on OnMobile powered WAP sites or voice portals. A user selects a product and proceeds to the payment menu wherein PayMate is offered as a mode of payment. The user then has to enter his PayMate PIN and complete the payment process. The user receives an SMS confirming the successful purchase of the product, states an official release.
“PayMate is extremely convenient, easy to use and compatible across all mobile handsets and operators. Most merchants have difficulty in accepting remote payments since customers are apprehensive about sharing credit/ debit card details online or over the phone. This makes PayMate an ideal solution for accepting payments online, over the phone or even at a counter since customers do not have to divulge any credit or debit card details at any time.” says PayMate founder & MD Ajay Adiseshann.
“OnMobile has enabled Paymate to offer its innovative and secure payment service via OnMobile IVR and WAP products to more than 100 million telecom subscribers in India. We will continue to offer more payment options for telecom subscribers” says OnMobile head-mobile commerce Balachandran Unni.
The company is also in the process of tying up with several offline merchants such as telco’s, utilities, insurance companies, cable and broadband services, tele-shopping etc and will be announcing its tie-ups in a phased manner, adds the release.
PayMate is currently being offered to Citibank bank credit card and banking customers and will roll out services with other banks shortly. To use PayMate, Citibank customers need to sign up for this service free with the bank by simply sending “PayMate” as an SMS to 2484. The customer will then be called and registered for the service following which they can pay at any of PayMate’s accredited merchants via a single SMS.
On receiving this SMS, the bank will verify the user’s mobile number with the account and on confirmation will debit the account accordingly. The merchant and the customer will receive a confirmation message from the bank approving the transaction. The entire transaction takes place at the cost of a single premium SMS.
The company ensures a secure payment solution as no credit/debit card information is ever disclosed during the transaction process. The trust model is based on the recommendations by Ernst & Young; which provides the security measures for both the bank as well as the customer.
PayMate is accepted at over 2500 online portals including travel, astrology, electronics, education, jobs, NGOs, apparels, matrimony, entertainment and healthcare etc. PayMate has also announced its tie-ups with Tele-brands, Big Tree (cinema ticketing), Mumbai Gold Cabs, Planet M, CRS Health, Seijo and the Soul Dish, VSNL, Future Bazaar among others.
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Zee News net profit Rs 93 million
MUMBAI: Zee News Limited (ZNL) today reported nine months revenues of Rs 1,665 million representing a 39 per cent growth over the corresponding period in the previous fiscal, compared on proforma numbers.
Overall net profit stood at Rs 93 million.
Subhash Chandra, chairman, stated, “Zee News Limited finished the nine months with a good performance, highlighted by strong advertising revenue growth of 54 per cent and robust operating profit growth of 179 per cent. We believe that Zee News Limited has the potential to grow into a media giant with a regional focus.”
“We are extremely pleased to see the steady steps towards digitization of the Indian cable and satellite industry. CAS has been successfully implemented in the notified areas of Mumbai, Delhi and Kolkata. With more subscribers opting for digital services even in other parts of the country, it will give a big boost to our subscription revenues in the near future. All these have extremely positive and long term impact on our business given that most of our channels are pay.” Chandra added.
Commenting on the restructuring exercise, Chandra continued, “The restructuring exercise for ZNL is now complete. ZNL is ready to exploit the vast emerging opportunities and will deliver long term shareholder value.”
