ITV

Tag: CAS

  • MSOs on prowl, Incablenet to support Home Cable in Delhi

    MSOs on prowl, Incablenet to support Home Cable in Delhi

    MUMBAI: Conditional access system (Cas) is forcing multi-system operators (MSOs) to strike alliances as they take up the challenge of expanding their digital subscribers.

    The latest to join hands is Incablenet and Vikki Choudhry’s Home Cable Network. Incablenet will be supplying its feed and digital set-top boxes (STBs) to the subscribers of Home Cable Network in South Delhi.

    “We have entered into a strategic alliance with Incablenet. They will be providing STBs to our subscribers. For those consumers who want to take our advanced boxes which are priced at Rs 2150, we will be providing them our systems. Others will have an option to take the Incablenet STBs,” says Choudhry.

    Incablenet uses a different encryption system and its boxes will not support the feed from Home Cable Network. “We have agreed to share each others fibre and infrastructure as we go ahead,” says Choudhry.

    Incablenet offers subscribers digital STBs at Rs 1500 (plus taxes) while cable TV subscription is free for six months on three bouquet packages. Home Cable, on the other hand, has an outright purchase scheme with the STB priced at Rs 2150. It offers 10 pay channels on a monthly subscription fee of Rs 45 while the 60-channel package is available for Rs 225.

    “Smaller MSOs in the Cas areas will find it difficult to subsidise the boxes and will take support of the bigger ones. Besides, they do not have enough boxes and know that any delay will mean that their subscribers will go away to other available options,” says an analyst who tracks the cable industry.

    Earlier, Wire & Wireless India Ltd (WWIL) had expanded its footprint in Delhi by acquiring a 51 per cent stake in Satellite Channels and signing up with Spectranet and Sanjay Cable Network for supplying digital services.

    In Kolkata, Sristi Broadband takes the feed from Manthan Cable Network. A group of operators of Sristi Cable TV are using the feed from Mathan and Zee’s Indian Cable Net as it could not make arrangements for STBs.

    “Sristi Broadband and a group of operators from Sristi Cable are taking feed from us,” says Manthan director Gurmeet Singh. Manthan has recently introduced a package for the second TV set where subscribers will have to pay Rs 90 a month for 50 pay channels. Manthan’s STB costs Rs 2599.

  • Cas effect: net reach of TV genres down in Mumbai, Delhi, Kolkata

    Cas effect: net reach of TV genres down in Mumbai, Delhi, Kolkata

    MUMBAI: With conditional access (Cas) coming into effect in certain areas of Mumbai, Kolkata and Delhi, the net reach as well as market share of all key genres has come down with the exception of Hindi News and cable channels.

    This is not surprising as Hindi news channels are free to air.

    Audience Measurement and Analytics has done a study on how Cas has afected television viewing. Total usage (Usage per viewer) of television shows a drop of 14 minutes in the first week of January 2007 versus the last week of December 2006.

    In Delhi the drop at the peak of prime time (for cable homes) is close to 12 per cent in the first week of the Cas rollout. Similarly Hindi movie channels too lost viewership all across the day. Mass channels and the mass genre retained reach but lost out on market share and time spent. Cable channels were the biggest gainers in this situation notes aMap.
    Mumbai presented a picture similar to Delhi with mass genre (Cable Homes) losing in terms of viewership in evening prime time and movie channels losing viewership in afternoon and evening prime time. Hindi News and Cable channels gained in market share as well asusage per viewer.

    In Kolkata the drop in ratings of mass genre across various day parts is the most. The drop is as steep as 25 per cent and 39 per cent during the afternoon prime time and the evening prime time respectively. There is a similar drop in ratings of Hindi movies and the drop during the peak day parts both in the morning and evening prime time is to the tune of 23 per cent. Cable and Hindi News channels gained market shares as well as registered an increase in the usage per viewer.

  • In pursuit of what in 2007?

    In pursuit of what in 2007?

    The CAS word gets TAM India CEO LV Krishnan thinking about what this brave new world could mean for the likes of the airtime sales exec and media planner.

    In the shifting sands of time the mind does seek for a grip; In the solitude of space constant change is unnerving; only the whiff of victory
    propel one to destination

    As the sun set on 2006, the glow of the last rays had fired the embers left behind by the changes initiated in the arena of TV channel ground distribution during the last few months. The beginning of 2007 itself is seeing a market place oscillating between the old fashioned Analog Technology to a new era of Digital Technology unleashed on the unsuspecting TV viewers by the Government, Multi System Cable operators, Broadcast Satellite owners as well as Telecom companies. With technology gizmos flying all around as well as the jargons attached to it, one is left wondering, what is going on in the simple minds of a Media Planner and Air time Sales member of our industry? Does large industry issues we debate about, top their concern? Take a guess…

    As one mingled with many of them, the concerns or issues were the same… What are we pursuing at the end of the chase?

    A perspective from the Media Planner’s diary

    March 2006: I read in today’s Media website that the Delhi High court has given a ruling to the effect that Conditional Access System is mandatory in South of Mumbai, Delhi & Calcutta for receiving pay TV. This was going to happen in the next few weeks…

    …Whoosh!

    June 2006: It didn’t happen…does it ever happen as proclaimed?

    …Zip…Zap!

    December2006: Will it happen this month? Will await Dec 31st to know…

    January 2007: It happened!

    As I walked into my office the very next day…the first day of the New Year, I wondered…

    Gosh, what will happen to my life? My Brands – Media Plans & Buys are ready to be executed, but now, will I have to put everything on hold? What will I answer my client? Will plan deliveries fall down in the 3 Metros? By how much? What is TAM data indicating?

    In a confused state of mind, I decided to get out of office to take a walk along the Worli sea-line hoping for some fresh breath from a magic genie.

    Yes, the winter air was filled with a new whiff. No doubt it was energizing my legs as I broke into a steady walk. As I took a sample of the freshness of 2007, the mind cleared to open up new possibilities staring at us… potential of ensuing change began to dawn on me. The revolution was just beginning and I was determined to ride the wave of change.

    With a renewed vigour, I walked back to my desk to put a call to my client. He was pretty surprised to hear me say that I will be coming down to meet him the same evening to explain to him the consequences of changes happening in the TV media.

    Next, I started with some desk work. I wanted to understand the magnitude of the change expected to be brought about by the CAS notification on Zone 1. A simple analysis from NRS 2006 as well as the TAM CAS document circulated earlier indicated to me that 1.6 million C&S homes across the 3 metros of Mumbai, Delhi & Calcutta will come under the purview. This meant one-fifth (20%) of C&S homes in the 3 metros or just one-twentieth (5%) of C&S homes represented by TAM All India Class I town panel.

    Hence if all the homes in the notified areas for CAS in the 3 metros did not go for set top boxes, the maximum impact in reach of my media plan due to of loss of viewing of pay channels on a National level is going to be less than 5%. In other words, the planned reach of 60% on a National scale could come down to 57%. This could only be the worst scenario. But things are already looking better with demand for set top boxes on the rise with each day passing…

    I then looked at my media plan composition – list of Pay TV channels & Free-to-Air TV (FTA) channels used to deliver the reach. On comparing this with the Free-to-Air channels available, I decided to make a few minor adjustments whereby by making minor spot changes between Free-to-Air & Pay TV channels, I was easily able to hike up the planned reach to 58% on a National level!

    As I started receiving the news that the demand for CAS set top boxes are increasing, I decided to stretch the brand campaign by a few days. This could help me leverage any additional homes that moved into using a set top box for accessing/viewing Pay TV content.

    What made me feel even more confident about achieving the media plan goal was the news that almost all the homes acquiring a CAS set top box will receive all the Pay & FTA TV channels he used to get before Dec 31st. This meant that, while in theory CAS set top box was supposed to act like a filter by providing the viewer with the choice to subscribe, at present it is only used as an enabler to watch all Pay & FTA TV channels which was available to the viewer earlier as a simple cable TV home. Thus, viewer behaviour in terms of channels watched post CAS set top box acquisition couldn’t have changed, thereby helping me to deliver my planned reach goals too.

    I am awaiting with bated breath the first TAM CAS penetration study later this month, more to understand the length of time it is going to take for viewers to start experiencing a shift to the world of digital content. I for one will be looking for the profiles of the CAS homes to try and plan execution of the new brand creative my marketing manager has promised. I have lots of ideas up my sleeve, waiting to explode in the digital space!

    A perspective from the Airtime Sales member’s diary

    January 2007: I looked up my watch and exclaimed “Damn it, going to be late again.” It was all because of this silly traffic…

    2007 had started with a sense of purpose. Yes, there were changes happening around. Positive, I could say. I was heading to meet a very important Up-market personal product marketing head. I was pleased that I could get the appointment after struggling for some many months to get it…only because I was going to show him something different!

    From the telephonic chat I had with him yesterday, I could sense his voice perk up when he heard about my channel’s new programming, showing promise among his set of exclusive consumers.

    I got out of the cab and rushed across the street clutching hard to my presentation papers. I approached the front office of the organization gasping for breath. The receptionist looked at her watch, acknowledged my presence on the intercom and then, silently led me to the massive board room. As I sat, wrapped around by the chilly air sent out by the humming air-conditioner, my mind whirred with excitement. At the same time, I had a sense of apprehension as it was for the first time I was going to present the findings about my channel from the Elite panel and I was not sure, how the marketing head could react.

    Suddenly, a booming voice saying “Hello” came in from behind. As I turned around, I came in contact with the marketing head, who was by then extending his arm to welcome me. Pleasantries were exchanged and we got quickly to the brass tracks.

    I opened my small presentation folder displaying the sheets about his products and target consumers. I could see him nodding to my opening statements. I was feeling relieved that I was bang-on in guessing his product’s consumer profile. This led me to draw up the next few sheets that explained the profile of viewers my channel catered on a daily basis. I could see him show inquisitiveness to my reports. Soon we got drawn into the discussion about my channel’s performance and the question I was waiting for all along got popped out. “How do you say that my consumers watch TV and therefore content related to your channel?”

    My best was yet to come. I opened up the data from the Elite panel to reveal to him the new, latest finding…

    His Up-scale consumers did spent time watching TV (unlike his thinking), but they spent less time watching it vis-?-vis the average TV viewer and even an SEC A TV viewer on the TAM National panel.

    The other important observation that impressed him was that the TV viewership of the Elite viewers was far more fragmented as compared to an average viewer and also the SEC A viewer in the National panel.

    While 26 channels accounted for 80% of viewership for the SEC A viewers, it took 35 channels that made up 80% share of viewing for the Elite viewers, a testimony to the wider content preference for the Elite! This invariably means that, in order to reach to the Elite viewers, the marketing head had to consume air-time across more channels of distinct content appealing to his Up-market consumers.

    As I progressed with my charts and comments, the final one hit the bulls-eye. Certain genres like English Movie channels, Business news, English news & English Entertainment channels had a visible skew towards the Elite audience as compared to even the SEC A viewers in the National panel. This made the marketing head look up. I could see a huge smile on his face as he made the comment “I always knew this and keep saying so to all my team members.” I just smiled back at him with the hope that I could have finally bagged the campaign, I thought, that deserved to run on my channel.

    It did happen as I visualized the very next moment. The marketing head picked up the nearby intercom, spoke a few words to the person on the other end, and then turned around to me to say the final words, the most precious words I have been waiting to hear “…the campaign will include your channel too.”

    That evening, I was certainly heady. We celebrated the win back in the office with a champagne pop up. 2007 indeed has begun for me in a new way I couldn’t have imagined a few days back. A real nice kick start and I hope to keep riding that way!

  • Trai warns some MSOs against analogue streaming in Cas areas

    Trai warns some MSOs against analogue streaming in Cas areas

    NEW DELHI: The Telecom Regulatory Authority of India (Trai) has warned all the MSOs that strict action would be taken against anyone beaming analogue signals in Cas (conditional access system) areas.

    This was informed to the MSOs at a meeting at Trai office on Friday. Trai said that this would have to be stopped with immediate effect, as it went against the law. Trai advisor Rakesh Kakkar told indiantelevision.com that the the regulator would come down with a heavy hand on anyone beaming analogue signals, as has been happening in some cases.

    Trai took stock of the ground situation regarding the availability of set-top boxes (STBs) and was reportedly convinced that there is no real shortage, but there is some delay in actual deployment due to the last minute placement of orders by subscribers.

    The MSOs also stated their positions about how many STBs have been deployed and how many are being imported. Reportedly, most MSOs are going for airlifting of STBs next week.

    Kakkar said that there was no shortage of STBs, but because of bunching of applications by consumers, there is problem with deployment. He added that there are some technical problems due to lack of stabilisation because of a sudden rush of orders for boxes in a short period.

    There are reports that customers are not getting channels as per the rules, and though the streaming is digital, no bouquet or a ala carte choice is available at the moment. In fact, Kakkar asked: “You must be getting the same channels through the Cas boxes as you did without Cas isn’t it?” That is because of the rush and customers not filling their forms in time, and also because the boxes given out in the initial rush were all preset, he explained. This will change soon, he added.

    MSO sources said also that they assured that there are enough boxes. One representative said that his company’s seeding is already 9,000 boxes a day. Incablenet representative Ashok Mansukhai said: “We have told Trai that our deployment would reach 10,000 boxes per day. We will be airlifting boxes from next week.”

    Wire & Wireless Ltd is also getting in additional boxes. “We have deployed 1.5 lakh boxes across the three metros over the past five days. We are going for airlifting of new boxes. By next week we will have 50,000 more boxes brought in, and by 31 January, we shall have additional 1.5 lakh boxes in position for deployment. This is apart from the 34,000 boxes awaiting clearance at Mumbai airport and another 12,500 boxes at Kolkata airport,” said WWIL executive vice president Arvind Mohan.

  • Tam’s Elite Panel data goes live

    Tam’s Elite Panel data goes live

    MUMBAI: It has taken quite a while but media research agency Tam has finally got its Elite Panel up and running.

    This latest value addition for the Indian TV industry will measure the TV viewership behaviour of the crème de la crème of the Mumbai and Delhi population.

    An Elite Household in the panel is defined as one which is SEC A1 owning AC & PC & Car.

    Tam’s Elite Panel is a mix of cable, DTH and Cas homes. The Indian Elite Panel captures the nuances of TV Viewing among the top three per cent of the Socio-Economic strata in Mumbai and Delhi. Tam Media Research CEO LV Krishnan says, “Across the globe, all Elite consumer media studies are recall based survey measurements. Very few attempts have been made to measure this exclusive set of consumers through a continuous panel based method. Tam’s Elite Panel is the world’s first such study to understand Elite consumers’ TV viewing habits.”

    “At this moment of time, I would like to thank every senior member of our industry who gave us a patient hearing, offered us valuable suggestions and stood the test of time to finally see the industry project through. What I am even more pleased about is that, throughout the two years it took us to implement the industry proposal, Tam received support from all constituents of the industry.

    The key question is how is this development viewed by the industry. Star India president, ad sales and distribution, Paritosh Joshi says that while he has not yet seen the numbers, in principle the Elite Panel together with Cas represents a strong plus for channels like Star Movies and Star World that target the affluent segment. “They will be able to offer more demonstrable numbers to clients. More and more brands that target the upmarket audience from sectors like hospitality, finance, automobiles, apparel and lifestyle are looking for the right media vehicles. This development will allow them to do that.”

    Zee Network’s ad sales head Joy Chakraborthy feels that the introduction of the Elite Panel is better late than never. “It is not fair that unique channels are measured in the same way as the general entertainment channels. That situation will change. So far unique channels have been bought on the basis of perception rather than on reality. It was a case of ‘if I am watching it then others must also be watching it’ scenario. This issue will now get addressed. We are still examining the data though, as we only just got it.”

    On the media side Starcom’s Manish Porwal was happy that the long awaited development had finally happened. “While we will wait and see how it fares in terms of consistency, the fact that it has happened is good news for the niche channels who will now get better exposure. Their representation earlier was small. It certainly allows us to look at the niche English genre with finer lenses and also allows us to better qualify the upmarket audience segment.”

    Spatial Access’ Meenakshi Madhvani says that so far the television ratings system has basically catered to the lowest common denominator i.e. the masses. Now though, one will hopefully get a better idea of what the small in number but important affluent consumers are watching. “It will allow us to get a better fix on the affluent viewers. Also the disadvantage that the niche channels had in terms of not having the numbers to show will not be there.”

    One of the additional USPs of the panel is that it has deployed the state-of-the-art Digital TVM5 peoplemeters. Commenting on this, Tam Media Research VP Pradeep Hejmadi says, “The Elite Panel comprises of homes receiving channels through a mix of Analogue cable, Digital set top box (Cas) and Direct –to-Home (DTH) platforms, making this the first technology-hybrid, platform neutral TV study.”

    Tam adds that across the globe, all Elite consumer media studies are recall based survey measurements. Very few attempts have been made to measure this exclusive set of consumers through a continuous panel based method. Tam says that its Elite Panel is world’s first such study to understand Elite consumers’ TV viewing habits.

  • ‘A revolutionary year that was also one of the government’s total failure to control the broadcasters’

    ‘A revolutionary year that was also one of the government’s total failure to control the broadcasters’

    One healthy thing is that the industry is moving… maybe slowly in some areas, but it is definitely moving, which was not there earlier. The manufacturers lobby which had become stagnant are looking forward again. Fibre optical networks are spreading.

    New technology is coming, and words we had never used two years ago, like IPTV & Mobile TV, are now common usage. DTH has been launched already and this will give competition to the cable sector and they will be bound to improve their services. HITS is on the way and if it is operated on C band then it will be good for the cable industry, but if it is put on Ku band, that will kill the cable industry. That will be a disaster.

    If it is on C band, digitalisation will become faster, but if it is on Ku band, all the DTH players would start giving out their signals, because they are already on Ku band. And the consumer will also suffer because one after another DTH players will come and ask for money for their channel bouquets if the subscribers want them, so this will hurt the latter’s interests.

    But I must say that Trai has given importance to the last mile operator, and this has been a major positive this year, they have realised the worth of the LMO and understood that it is the last mile people who have created the industry. They know now that the LMO is the one who gives the connection and actually works in the field.

    Thus, to get 25 per cent to carry pay channels on the network was worthwhile. That was not there at all and that is a great achievement. You can say this is only in the CAS area, but a beginning has been made, that these people ought to get this much, which is a model now. So now we can take this forward and at least demand what we deserve. When voluntary CAS is extended to the 55 cities, we shall at least get some margin for letting them use our networks, based on this model.

    Again, Trai for the first time has worked out the pay channel rates. Rs 5 for CAS areas and even for the non-Cas areas they have set an upper cap and declared the prices. Yes, of course the broadcasters will protest because they do not want to be controlled. The problem for the cable operator is that he never, before this, knew what he was going to charge the customer, who also never knew what he was being charged for and at what rate.

    But the best came from the High Court, the order that CAS had to be rolled out. The courts, whether TDSAT or High Court or Supreme Court has been acting only in public interest, and two of the major decisions related to fixing the price of a sports channel, when Neo wanted to charge an astronomical price but was not allowed, and when the court upheld the government Act on sharing sports events of national importance with Doordarshan.

    But beyond the rosy developments, the two worst things that happened this year were failure to extend CAS, and the failure to control the broadcasters. And in fact non-extension of CAS is mainly due to resistance from broadcasters lobby. They have earned too much of money in a non-addressable system and wants the market to stay that way.

    I feel sad also that the government this year did not heed to our demand, the only demand, that we be given funds for going digital, which would have really helped, but that was turned down. It is small money and the government should have facilitated the LMOs by telling banks to make it easy for them to get small loans to facilitate digitalisation.

    For the government this was a year of failures on several fronts, I am a member on three government committees, and all three here failed to deliver because of lack of will of the government and the most dangerous development is vertical integration, creating absolute monopolies, and the governments failure to implement cross-media restrictions.

    As far as CAS is concerned, extension, even under voluntary effort will be good for the industry. But even if an LMO, say in a place like Kota in Rajasthan ushers in voluntary CAS, the broadcasters will not give him the decoders under one pretext or the other, saying that his SMS or some other system is not accurate and he is still under-declaring his subscriber base. The government has thus squarely failed to reign in the broadcasters on all fronts.

    In passing, I must say one thing: the image of the LMOs so far had been that we are rowdy, uncontrollable. But in a series of meetings the government has seen who is rowdy, the journalist broadcasters or cablewallahs and officials are now saying, at least the LMOs have some dignity! That is why the goodwill for us has increased in the government quarters.

  • ‘A revolutionary year that was also one of the government’s total failure to control the broadcasters’

    ‘A revolutionary year that was also one of the government’s total failure to control the broadcasters’

    After working for decades on the analogue system, 2007 was a huge learning year. Whether from the regulator or from the ministry’s side, or from the Prime Minister’s Office, this was a revolutionary year.

    The major thing, of course, was the implementation of CAS, though implementation was partial, but this implementation was a slap on the face of people who put in all their efforts to derail it. More than anyone else, even more than the broadcasters, the ones who tried their level best to stop CAS were the distributors of the MSOs.

    Broadcasters and distributors both lose out if CAS comes in, and the broadcasters are hit because they are earning both from subscription as well as advertisement, and now SMS revenue stream.

    One of the ugliest efforts for derailing CAS this year was the press conference and the false survey report shown by a section of the NGO called VOICE. They said 70 per cent of the CAS subscribers wanted to go back to the old ways, but now it is clear that the so-called survey had been sponsored by a broadcaster and everyone knows who that is.

    It is the advertisers who would have gained because as of now they do not know where their money is going and where they should actually put that in, and SMS in CAS regime would tell the real story. This is why various advertiser groups have come in support of Cas.

    From the content side, again this was a very important year. The viewers were very unhappy with news content and the government tried to do something but eventually failed.

    All these news broadcasters are launching channels every day not to inform the people but to have more and more power, sometimes using that power to blackmail politicians and officials. There is an attempt to capture the media and have clout. If they were serious news people, then one broadcaster would not launch two or three news channels. They are also now launching regional news channels because they want to capture power area-wise and rule there. Apart from earning money, they want to control the mindset of the people.

    The government’s attempts to control these news channels failed miserably because the channels formed a strong lobby against the Content Code suggested by the government. This shows that the government is able to control only the farmer or the last mile operator, the cablewallah. Because as per the Cable Act, only the LMO will be targeted, whether it is for programming content that is unacceptable or the advertisements shown, over which last mile has no control.

    The LMOs do not have too much money, so they lose out in courts because they cannot hire top lawyers, and they cannot lobby with the government because they are not always qualified people or have a political clout. That is why they are the least heard, but this year, that is one big thing that has happened: the government, whether in the ministry or Telecom Regulatory Authority have at least started hearing us. I will tell you how.

    One of the most dangerous things that happened in this year is the total vertical integration of companies who have a finger in all the pies, being broadcasters, running MSOs, getting into DTH, IPTV and mobile TV. The government has failed to take steps against this monopolisation. Their officers are trying but the politicians are not allowing this.

    But two very important positives things happened this year, and if we have not started running, we have taken a few right steps. We are trying to control the broadcasters through some NGOs, and the government has started listening to us. They may not be doing much, but they are surely listening.

    One is the Content Code, and the second is digitalisation, which will help people watch more and more channels. The PMO has formed a committee on digitalisation. The other good thing is that the I&B ministry is trying its best to bring down the duties on the equipment, though finance ministry is not in a mood to listen.

  • Cas: MSOs strain to meet demand for boxes

    Cas: MSOs strain to meet demand for boxes

    MUMBAI/DELHI: Multi-system operators (MSOs) are under stress and strain to meet the demand for set-top boxes (STBs) as conditional access system (Cas) has come into effect in the notified areas of Mumbai, Delhi and Kolkata.

    “We are moving 5000-6000 STBs a day in Mumbai,” says IndusInd Media and Communications Ltd. director-in- charge Ravi Mansukhani.

    Wire & Wireless India Ltd CEO Jagjit Singh Kohli says that while he can’t give a number in terms of the number of boxes being seeded, business has been brisk and smooth. “There have not been any technical glitches. The Cas deployments in the notified areas by all the cable operators has so far been much more than what direct-to-home (DTH) has achieved in these pockets.”.

    For those who are taking the boxes, MSOs are providing all the pay channels for a trial period of 15 days. “We want to give them some time before they can decide on the channels that they want to pay for. After this period, they can choose what they want and they will be billed only for what they have decided to take,” says Mansukhani.

    Adds WWIL executive vice president Arvind Mohan: “This is a transition period, so we are giving all the channels to all the STB subscribers. The processing of the forms being filled up takes some time. We are giving the subscribers a free run of all the channels. By 15 January, the entire system will be in place, and billing will be for the month depending on the channels they have selected.”

    So how long does it take once a consumer orders for a STB? With so many people wanting a box at the same time, the maximum time it would take to get the system installed is a day as it has to be fed into the smart card and billing system, says Mansukhani.

    Interestingly, there are indications that at the ground level there is some confusion in terms of pricing. For instance, this writer, residing in the Colaba area of South Mumbai, paid Rs 2000 on 1 January for a box while the MSO had recently announced a reduction in the price to Rs 1500. “There are some confusions still prevailing on the ground about the prices and packages on offer,” admits a local cable operator.

    Speaking on behalf of the broadcasters, Star India’s distribution head Tony D’Silva says that it is too soon to comment on the adoption rate. “We had expected that there would be some confusion. We are adopting a wait and watch policy. In a few days time the situation should be clear.”

    Zee Turner CEO Arun Poddar says that there is certainly a demand and supply mismatch across all the MSOs. He concedes some last mile operators would not be communicating adequately with consumers, thus leading to confusion.

    Despite some confusion, the Cas rollout in South Delhi is happening steadily as there is a rush for the STBs.

    SN Sharma of Hathway denied that there is any shortage of boxes. “This is a continuous process and we are getting consignments from our Korea company on a daily basis. There is a lag of time for getting connected because the local cable operator has a manpower shortage,” he says.

    The time between a request coming in and a box being connected is about an hour, he adds. “The LCOs have about five or six people working, who have to attend to calls for repairs, collect payments and also deploy the boxes. So the connection giving ability is in the same ratio as the staff strength.”

    According to RWA president GS Gulati, most of the residents in Delhi were still waiting and have not subscribed to either cable or DTH operators. “The cable operator has left a box for me at my shop, but I have not got connected, because we do not know what is better, this or DTH.”

    In some areas, people complained about technical glitches. Sometime during the evening of 1 January, Cas boxes in some areas of south Delhi went blank for about 10 minutes first, and then intermittently for shorter durations about three times.

    “This should not be the case, because the boxes are highly efficient. This must be some fault like a loose connection or a person tinkering too much with the remote control, as people do with all new things,” Sharma says.

  • ‘As an industry, we should support unregulated Cas’

    ‘As an industry, we should support unregulated Cas’

    SET Discovery president Anuj Gandhi offers his take on how the distribution scenario would shape up in 2007 in the wake of digital cable and direct-to-home (DTH) penetration.

     

    The year 2006 was when broadcasters consolidated their businesses and made money on the second bouquet. The incremental increase in revenues for distribution companies largely came from this.

     

    The combined growth in pay TV revenues was in the region of Rs 2.5-3 billion. This included the southern channels and later in the year Sun TV, the most popular channel in the region, also turned pay. Star One, which had problems in Mumbai and Kolkata, got established. We also made money from our second bouquet.

     

    Direct-to-home (DTH) also became a reality in the year. Though it took time, Star India and SET Discovery bouquets were available on DTH as rates became realistic.

     

    On the cable TV front, progress was made towards implementation of Cas (conditional access system). The Telecom Regulatory Authority of India (Trai) came out with more definite regulations and there was intervention from the various courts. Unlike 2003, Cas definitely is more structured and planned this time. It, however, remains to be seen in 2007 whether it turns out to be a success or not.

     

    The big story in 2007 would be DTHccccccccccccccccccccccccccccccccccccccccccccccccccc and digital cable. Pay broadcasters would expect to net Rs 3.5-4 billion from DTH and the bulk of it would be incremental without eating into cable TV.

     

    We should see deals being struck on all addressable platforms. Digital cable, voluntary Cas, Headend-In-The-Sky (HITS) should all become a reality and make economic sense to distribution companies like us. As an industry, we should support unregulated Cas. Things will take time to settle down till digital gets in mass volumes.

     

    The big problem area should be a la carte pricing, but I don’t see channels deciding to price themselves individually below Rs 5. We would also see bouquets emerging in the Cas areas. It won’t be easy for consumers to forget the channels that they were receiving for so long. Family packages, properly priced, should take off. Pricing and a lot of other things, though, will depend on volumes.

     

    Equations will change in carriage payouts to multi-system operators (MSOs). As ratings towns get added, carriage will move there. And these towns would not have a digital story. But I don’t see budgets of broadcasters towards carriage really jumping. What would happen is that they would be picking and choosing the places where they want better placement and carriage.

     

    IPTV will see trial runs in 2007 but the commercial launches should happen only a year after that. All in all, there will be lot of changes in the marketplace in 2007.

  • ‘Investors are waiting for Cas to roll out before they come up with definite valuations’ : Ravi Mansukhani – IMCL director-in-charge

    ‘Investors are waiting for Cas to roll out before they come up with definite valuations’ : Ravi Mansukhani – IMCL director-in-charge

    Cable TV is in the midst of transition. We are seeing Cas being just implemented. Consumers are wanting set-top boxes (STBs) so that they can see their favourite pay channels. Multi-system operators (MSOs) are gearing up so that demand doesn’t outstrip supply. They know this is their last chance: if they don’t do it right, direct-to-home (DTH) will take over and they will become dinosaurs.

     

    In an exclusive chat with Indiantelevision.com’s Sibabrata Das, IndusInd Media and Communications Ltd director-in-charge Ravi Mansukhani discusses the dynamic changes taking place in the area of cable TV, the exciting prospects for digitisation, and the challenges that lie ahead as way of competition from emerging technologies.

     

    Excerpts:

    HTMT had earlier decided to consolidate its media businesses under InNetwork Entertainment Ltd (INEL). What made it change track and bring IndusInd Media and Communications Ltd (IMCL) as the umbrella entity?

    Suddenly the cable distribution business, which is with IMCL, has become big and is heading towards transparency under conditional access system (Cas). It has got a definite growth path now. That was not the case earlier and we thought we would bring everything under INEL which is the content company. The track has changed and content will sit on distribution. So we are merging In2Cable ( the broadband subsidiary) and INEL into IMCL. The parent company for the consolidated media business will be HTMT (an existing listed entity). The demerged IT/ITES entity will be listed under HTMT Technologies.

    While Zee Telefilms has demerged its media entity, your restructuring process is actually consolidating the media business. Is this because the different lines of media business are still having nascent revenues?

    We couldn’t have separated the different media activities as we don’t have size at this stage. We are only demerging the IT/ITES business from the media activities as we believe these have separate identities, will need independent focus, and can unlock value for the shareholders.

    Will HTMT (residual) also house the real estate business?

    The company will have the media businesses, Shop 24 Seven (shopping channel) and the real estate business. The demerger process is underway and a listing is expected by February-end after the restructuring process gets the necessary regulatory approvals.

    Isn’t this a strange mix for an investor in the company?

    There is some real estate property which was sitting there earlier in the company. Since we aren’t expanding on that at this stage, we are leaving it as it is. Real estate may become a play later.

    How much cash will be allocated towards expanding the media business?

    We will have Rs 5 billion for this. This will be used for new business initiatives, acquisitions and funding the expansion of the media and entertainment business.

    Like Zee’s Wire & Wireless India Ltd (WWIL), are you planning to make last mile acquisitions to expand your network?

    We are adopting a different business plan where we want to partner rather than buy out operators. WWIL, on the other hand, wants to acquire 51 per cent in cable networks. Our expansion plan includes offering to operators shares in HTMT (after demerger) as they form an integral part of our distribution chain. This will be based on the subscribers they declare. No decision has been taken as to the exact ratio that would be on offer.

    Will one share be issued to operators for every declared subscriber?

    We are working towards that.

    Do you think your strategy will be more acceptable?

    We have decided that is the best way to go forward, even in the non Cas (conditional access system) areas. By becoming shareholders, operators won’t perceive us as a threat. They can own their network while we make the investments on technology and digital cable. This way they can retain their customers, particularly as they face threat from DTH and other digital cable service providers. We are not exercising the buying option yet. If they want to sell, we may step in later. And by having ownership over the network, it would be in their interest to drive up ARPUs (average revenue per user) and launch value-added services.

    Will ARPUs fall?

    Initially, it will fall or stay flat. The subscriber ARPU in the Cas areas where we are operating is Rs 250. We see this going up to $10 (Rs 450) in two years and, perhaps, to $15 (Rs 675) in five years because of value-added services. Our topline is going to be rammed in the first year, but the bottomline is going to improve immediately as we will have an assured distribution margin.

    Would you prefer inducting a strategic rather than a private equity investor?

    We would favour a strategic than a pure financial investor. We feel inputs from a strategic partner would give us a competitive edge.
    But the possibility of roping in an investor would likely be after the listing of the two entities.
    ‘We are not looking at customer acquisition via bouquet packages. For the ground to open up territorially for the MSOs, it will take time.‘

    Are investors keen to know about the content side of your story?

    Investors at this stage basically want to know our distribution plan. Our focus right now is on the distribution side of the business. Perhaps, by April we will have an investment plan for content and the other lines of media business.

    Have you initiated talks with global major Liberty which has shown interest in entering into India?

    There are a bunch of them who are interested in India’s cable story. But all the investors are waiting for Cas to roll out before they come up with definite valuations.

    Multi-system operators (MSOs) have announced bouquet packages. Do you see this as a price war to win consumers or local operators from rival networks?

    Our schemes are directed to make our existing consumers happy. We are not looking at customer acquisition via packages.

    Isn’t there a conscious effort to protect your turf from WWIL, which wants to poach operators to increase its thin presence in Mumbai, and DTH service providers like Tata Sky?

    We took care to offer a better quality package than WWIL or Tata Sky. We are offering six months of free subscription for consumers who have to pay just Rs 1500 (plus taxes) in the Cas areas. We are offering three bouquet packages – Star loaded (Sitara with 18 pay channels), Sony-led (Sona with 20 channels) and Zee-Turner (Zabardast with 35 channels). Under the STB rental scheme, we are offering the Optimiser package (Star and Sony bouquets) at Rs 120 (second TV set Rs 55) and the Super Saver scheme (Star, Sony and Zee bouquets) at Rs 190 (second TV set Rs 100). DTH has a high entry barrier as installation of the boxes are costlier than cable. And for the ground to open up territorially for the MSOs, it will take time.

    With WWIL intending to poach operators, do you have a truce on the ground with Hathway Cable & Datacom?

    We would like to keep the peace on the ground.

    With Cas already on, do you see a situation where demand for STBs will outstrip supply?

    We are confident of tackling it. We have in stock 168,000 STBs and have seeded over 40,000 boxes. We are installing more than 5,000 boxes a day. People are waking up as the pay channels are blacked out. We are ready to meet the surge in demand. We have also ordered for over 100,000 STBs from a Korean vendor.

    How keen are you to beef up the content side?

    We will put all our energies into distribution now. Once we have a solid distribution platform, then we are actually de-risking on the content front. We want to get into movie production and are looking at the distribution chain as well. We have earlier done movie financing and have funded around 14 movies from the current crop.

    Are you going to line up special channels for Cas subscribers?

    We are launching thematic channels without advertisement breaks. We have already started In Digital Premium which was made available first in Mumbai. It will also be seen in Delhi and we have movies in different themes – action-oriented, comedy and drama. We are planning to charge Rs 5-10 per movie. We will add more channels.

    What are your plans for CVO?

    The cable movie channel is highly popular and is licensed across 55 cities. But it has been stagnating over the last few years. With our distribution growing, it will bounce back into the growth path. We continue to acquire movies. Last year, we bought 150 movies.

    Revenues from cable internet and content have been depressed. How are you planning to promote your broadband business?

    We are revamping our broadband business. We will be aggressive on pricing. Our focus so far was on quality, not price. We never believed in LAN-based (local area network) internet. Now we will be doing that model. For the last two years, we concentrated on consolidating and upgrading our networks. Even we will start VoIP (Voice over Internet Protocol). We have this system connecting all our Hinduja offices across the globe. We will have to see how we can expand on that and launch commercially.

    What are your revenue projections this fiscal?

    We did Rs 1.6 billion last fiscal, with cable distribution accounting for Rs 1.38 billion, INEL Rs 170 million and In2Cable Rs 50 million. We are not sure how we would finally end up this fiscal as we expect the last quarter to be chaotic. But the topline should leapfrog by FY08.