Tag: MSO

A year when OTT onward march & TRAI tariff issue hogged limelight

MUMBAI: 2018 could have been easily dubbed as the Indian year digital or OTT, with its chaotic growth continuing and multi-million dollars being poured into programming by global and local players, however, the new tariff and regulatory regime for the broadcast and cable sector occupied as much mind space.

Though these are early days for a sure shot business model for digital space emerging as players continue to experiment with AVOD, SVOD and combination of several other models, there’s no denying OTT has more than a foot inside the door in India.

According to a report by market research firm Media Partners Asia, online video revenue, comprising net ad spend and subscription fees, will grow at an 18 per cent CAGR across Asia Pacific between 2018 and 2023, climbing from $21 billion 2018 to $48 billion by 2023. While China will account for the lion’s share of industry value, with more than 60 per cent of Asia Pacific online video revenue and more than 75 per cent of direct-to-consumer SVOD subs by 2023, other big markets by revenue would include India, Japan, Australia, Korea and Taiwan.

So, though traditional pay TV is not dead yet and will continue to grow in India as the saturation point is still far from over (BARC India estimates there are about 197 million TV homes in India over 100 million still to be covered), traditional media players have realised OTT and other forms of digital delivery of video — professional or user generated — will continue to grow and put pressures on ARPUs and other numbers as more Indians take to smartphones and devises with broadband infrastructure slowly improving and cost of data plummeting in the short term.

The inroads into India in 2018 made by Chinese mobile companies have been impressive while raising fears of tracking and data misuse too.

“With 160 million shipments of smartphones in 2019, apart from being the only market to grow in this sector, India will also be the most potential market for global content creators,” Zeel MD Punit Goenka tweeted last week. This observation is testimony to traditional media players waking up to the competition from OTT platforms for eyeballs.

The growth of online platforms also means the continued search for both original and library content too will grow as it did in 2018. Not only global players like Netflix and Amazon announced big-budget investment in original content starring leading Hindi film stars like Shah Rukh Khan and Saif Ali Khan, local companies too have upped the ante realising the potential of the digital space. Star India’s digital arm Hotstar claimed 100 million viewers for the IPL cricket and ZEE5 has come out with some refreshing non-fictional programming.

If online video distribution is growing in India, so has the demand for content regulation. Even as Indian policy-makers struggle to understand the business model(s) for digital players, the cry for regulation to suit Indian sensibilities (or lack of it) too has increased. Netflix Indian original Sacred Games is still fighting out a legal case, while informal warnings have gone to other Indian OTT platform too to tone down edgy programming being streamed.

Bouncing amongst several government organisations (MIB, TRAI and Meity), the issue of online content regulation was a hotly debated topic in India with a large section of the industry pushing for self-regulation like those prevailing for TV content.

If not in 2018, some sort of content regulation for online video will definitely come. The only thing that matters is whether in 2018 or it will be post general election in 2019.

The action in the online video segment and its delivery mode was catalysed by the arrival of Reliance Jio that has expanded from just being a player to becoming a behemoth in a short period of time, handing out services at comparatively low prices. The rollout of Jio Giga fibre network in 2018 has sharply woken up legacy distribution players, including telcos who went on a partnership spree to source content.

And, if the regulators in India struggled with the issue of online content, TRAI’s new tariff regime, proposed first quarter 2017, continued to cast a shadow in 2018 with confusion relating to some aspects (like a 15 per cent cap on discounts to consumers for TV channels) lingering on like a unfinished record playing out discordant notes. While TRAI has sought clarification from the Supreme Court on the discount issue (the next hearing is sometimes in January 2019), it has simultaneously cracked the whip on broadcasters and distribution platforms to fall in line with its new tariff regime by end of the present year.

The formulation of a new telecom policy or the National Digital Communication Policy 2018 could also be said to be a milestone as India stopped just short of creating a mega communications regulator overseeing the realms of TV broadcast, online and telecoms, depending on having increased synergies amongst these segments and their regulatory regimes.

Increased mergers & acquisitions seen in 2018 would continue consolidating the market and players. But such activities also raised doubts on possible creation of monopolies. Disney takeover of most of the media businesses of Rupert Murdoch’s 21st Century Fox, including Asia biggie Star, played out in India too even as Mukesh Ambani’s Reliance Industries and its various arms went on a shopping spree buying sizable stakes in content makers (Balaji Telefilms, Eros, for example), distribution platforms (Hathway, DEN Networks) and other media assets. That Subhash Chandra-founded Zee too is looking for an investor spiced up the mergers and acquisitions space.

Channels continued to be launched in 2018 with almost all networks rolling out new offerings in regional languages – a trend which began over 2016 and 2017. Colors Tamil, Sony Marathi, Star Sports 3, Zee Keralam were unfurled for viewers by the major players. What's keeping broadcasters buoyant is the annual expansion in advertising continues unabated at about nine to 10 per cent annually.

While legacy media players (like cable TV, MSOs/LCOs, DTH) in India have started a fight for survival and improved bottomlines in the aftermath of online’s growth, the #MeToo effect in 2018 did not leave the media and entertainment untouched.

Though #MeToo in 2018 more impacted the advertising and film segments with some big names becoming casualties, the ripple effect in the broadcast sector was low. But the movement has opened up a can of worms in the Indian media, entertainment and advertising segments.

The industry is on tenterhooks in an election year, wondering whether the BJP or NDA will make a comeback in April-May 2019 or yield to the Congress. Will the policy regime continue or will there be changes? These are questions that seem to be creasing many a brow.

But on the whole, will the trends continue in 2019? Of course, yes as it too promises to be quite a roller-coaster.

December 26, 2018
IBF to intervene in TRAI’s SC petition on 15% discount cap

MUMBAI: The TRAI tariff order, which remained a topic of intense debate and discussion in 2017 and 2018, is likely to dominate discourse early on in 2019 too, at least from a legal standpoint as the Supreme Court resumes work after the winter vacations.

A source close to the development has told Indiantelevision.com that the Indian Broadcasting Foundation (IBF) is set to intervene in the matter — a special leave petition (SLP) filed by the regulator seeking clarifications on 15 per cent discount cap — when it gets listed.

All parties, including Star India, which were part of the Madras High Court proceedings, are involved in TRAI’s petition on the issue of 15 per cent cap on discount on a bouquet price or a la carte price of TV channels to consumers.

The IBF was not originally a party, but an intervener. Hence it wasn’t incumbent upon the TRAI to make it a party in the fresh SLP. However, the IBF will now implead itself in the petition.

Currently, the tariff order and regulations are getting implemented without the 15 per cent cap as confusion prevails over its validity, though a section of the industry is of the opinion that the Madras High Court had struck down the discount cap issue. TRAI had not issued any clarification on this while setting a roadmap earlier this year for the new tariff regime’s implementation after the Madras HC order.

On Monday, Star India’s MD Sanjay Gupta during a media roundtable, responding to a question from Indiantelevision.com on the broadcaster’s position on the 15 per cent discount cap said, “It is up to the court to decide that. Now, as an SLP is in the SC…the courts will decide. I don’t have a view beyond that. In the current ruling, there is no discount cap. It may change going forward depending on the SC ruling.”

Gupta, however, was confident in adapting to a new pricing structure should the SC uphold the high court’s view on the 15 per cent cap.

“In case the court has a new ruling that discounts have changed, pricing [too] needs to change, both a-la-carte and bouquet pricing in that case, because the distance between them has to be only 15 per cent. I think we are still awaiting the court’s decision and if we need to adapt to it, then we’ll adapt to it. But there will be a shift again in pricing if that comes through,” he added.

TRAI’s petition demands that the SC set aside the portion of the high court judgment that frowns on the 15 per cent cap on discounts on bouquet prices of TV channels.

The Madras High Court, while upholding most of the TRAI tariff order — issued middle of 2016 and challenged by Star India and Vijay TV later that year on grounds of overstepping of jurisdiction — had struck down as arbitrary almost 18 months later the 15 per cent cap on bouquet prices.

With the case finally disposed of by the Supreme Court earlier this year, upholding the high court’s views, TRAI had issued a notification stating that India’s broadcast and cable industry stakeholders implement its tariff regime in phases and report on compliance.

December 19, 2018
TRAI secretary Sunil K Gupta explains need for tariff order

GOA: After several twists and turns, Telecom Regulatory Authority of India’s (TRAI) new tariff order crossed its last legal hurdle in the Supreme Court on 30 October. Now, with less than one month left for the implementation of the regulations, several questions still concern the industry stakeholders. On the second day of the Video and Broadband Summit 2018, TRAI secretary Sunil K Gupta spoke on the new regime via Skype and answered questions raised by stakeholders. He also threw light on the initiatives taken by the regulatory body to make consumers aware of the radical changes.

Indiantelevision.com needs to clarify here that since the VBS session was held in Goa last month, a development has taken place in the form of TRAI, last week, filing a fresh petition in the Supreme Court for review of the Madras High Court observations on a cap of 15 per cent discount on bouquet prices of TV channels.

Gupta started the session explaining the need to have a comprehensive regulatory framework for dealing with the problems of the broadcasting sector. Talking about the problems faced by different stakeholders, he cited the example of the issues faced by MSOs and LCOs, broadcasters as well as consumers.

In the case of MSOs and LCOs, the biggest problem was discriminatory treatment by broadcasters. As a result, it was almost impossible for smaller MSOs to get the content at the appropriate price from the broadcasters because the agreements were not transparent. Moreover, the problem was concerning customers as well due to the different rate of channels at different platforms. They didn’t have the power to choose and were forced to take channels provided by the DPOs.

Broadcasters also faced various difficulties due to the lack of transparency in the entire ecosystem. While they were giving free-to-air channels, they felt that, in many cases, those channels were being actually charged. This menace reduced the probability of use of those channels resulting in fewer viewers. As the revenue of FTA channels is highly based on viewership, the business was getting affected.

“Similarly, there were problems with broadcasters also as many time broadcasters were complaining that the content which is given to the consumers is not of high quality. Secondly, there are certain channels which were demanded by few stakeholders and because of the cap such channels could not be launched as there were serious issues particularly if you look at channels that are a requirement of a select class of stakeholders,” he said.

“So considering all these issues and also the issues of non-transparency, we have come up with a very comprehensive framework. The comprehensive framework gives rights to the broadcasters to price their channels properly and transparently communicate to consumers,” he added.

Gupta also explained that TRAI has made arrangements so that price of a particular channel can clearly be displayed on the electronic programme guide. He later added that due to the new regime, subscribers would have choice of channels as well as all the information. Moreover, Gupta said subscribers can get all the related information on the website of the MSOs in the tab which is called ‘customer corner’.

“As far as MSOs are concerned, there were issues that they did not have funds to upgrade their network for good quality experience to consumers. Now, there will be dedicated money for MSOs and LCOs so the network can be upgraded and good quality service can be given to consumers. Broadcasters also have the freedom to choose what price they can get from subscribers and also appropriately optimise the prices so that they can get maximum revenue of advertisement as well as subscriptions from the consumers,” he added.

Responding to a question from the audience, Gupta said there is no change in the license of the LCOs and they are supposed to take registration form from the post office only. But he also mentioned that they are working with MIB so that the process can be made online.

Many MSOs and LCOs raised the concern that it looks like they are being reduced to merely a commissioned agent. Gupta said the functions of LCOs and MSOs have properly been described under the Model Interconnect Agreement (MIA) and the Standard Interconnect Agreement (SIA) divisions.

“Here the framework is that a channel price which is being prescribed is the broadcaster’s understanding of the price of the particular channel. Now 20-35 per cent discount which is being given is to do certain work for that particular channel. Here, Rs 130 is being given differently and separately to MSOs and LCOs as they are providing the connectivity to consumers and consumers are getting the service from them. In addition to that, the portion of the discount on the content which is either 20 per cent or anything in between 20-35 per cent will also be accounted for sharing between the MSOs and LCOs,” he explained rejecting the claim that MSOs are only about to get commissions.

TRAI is also taking measures to inform consumers properly about the upcoming change. There will be big campaigns as well as meetings in cities like Delhi, Jaipur, Hyderabad, Kolkata, Mumbai and Bhopal. In addition to that, TRAI is also going to start a programme to inform the consumers. Even jingles will be played on radio and other media to grab consumer attention.

December 10, 2018
MIB extends feedback deadline date on mandatory sports feed sharing norms

MUMBAI: Ministry of Information and Broadcasting (MIB) has extended the deadline to give feedback on the draft sports broadcasting signals (Mandatory Sharing with Prasar Bharti) (Amendment) Bill, 2018 till 31 December 2018. In an earlier notification dated 17 October, it said that feedback must be given within a month to enable telecast of “Sporting events of national importance’ on mandatory channels of Doordarshan via cable/DTH/ IPTV operators.

As per provisions of the Sports Act, the live feed received by Prasar Bharati from the content rights owners or holders is only for the purpose of re-transmission of the said signals on Doordarshan’s own terrestrial and DTH network (DD FreeDish) and not for
cable operators or other distribution networks. The ad sales is also done by private companies after taking the pubcaster into confidence with the additional ad revenue shared between the rights holding TV channel and DD.

Viewers, who do not have DD FreeDish [pubcaster Doordarshan’s FTA DTH platform] or Doordarshan’s terrestrial network, are either unable to watch these sporting events of national importance or are compelled to watch these sporting events on highly priced sports channels.

Additonally, private DTH platforms and MSOs/LCOs were barred from showing DD's non-terrestrial channels that re-transmitted the shared feeds, after the August 2017 Supreme Court ruling, for the duration of that particular event and it was stressed upon also by Prasar Bharati fearing adverse reaction from the apex court.

The extension notice reads: “Reference this Ministry's earlier notice dated 17.1 0.201 8 seeking feedback / comments on Draft Sports Broadcasting Signals (Mandatory Sharing with Prasar Bharati) (Amendment) Bill, 2018, it is informed that the deadline for receiving feedback/comments from General Public/Stakeholders on the said draft Bill, 2018 to enable telecast of 'Sporting events of National importance'on mandatory channels of Doordarshan via Cable /DTH /IPTV Operators has been extended by this Ministry till 31 .12.2018.”

November 9, 2018
Nokia partners GTPL for broadband deal

MUMBAI: Nokia confirmed its partnership with GTPL, a cable TV and broadband service provider company. In order to upgrade its networks, GTPL will use and install Nokia’s fixed access and core technology.

GTPL’s ethernet-based access network will be replaced by the upgraded fibre cables capable of supporting ultra broadband speed. The broadband provider will also utilise Nokia Broadband Network Gateway (BNG) solutions for reliable ultra broadband access in residential areas. This will promote a faster internet experience for the subscribers.

As per the agreement, Nokia’s GPON technology will be used by GTPL, also along with that, the currently deployed Nokia BNG’s. This move will boost existing service speeds and drop-ship new ultra-broadband services including high speed internet, linear TV and video-on-demand (VoD) services.

As per ET Telecom, Nokia’s GPON equipment will be deployed across various cities in the Gujarat state by the end of this year.

Speaking to ET Telecom, managing director at GTPL Hathway, Anirudh Jadeja said, “India is recording a massive increase in broadband consumption, and as people begin using digital platforms to complete a number of day-to-day tasks they will demand an even better broadband network. We believe our partnership with Nokia is crucial to our growth. The modernised network will allow us to provide a world-class broadband experience to our subscribers. It is also in keeping with the Indian government’s drive to promote the use of the digital platform as part of its Digital India vision”.

Ahead of the partnership, head of emerging business at Nokia, Vinish Bawa looked excited as he stated, “We are delighted to work with GTPL to transform its networks to deliver an improved network experience for its subscribers. This deployment will enable GTPL to meet fast-growing demand for a better and faster network experience. Our technology solutions will allow GTPL to differentiate itself from other market players to attract more customers”.

October 26, 2018
Broadband on cable fibre declining?

BENGALURU: Is broadband on cable fibre on the decline in India? Results over the past few quarters of some of the multisystem operators or MSOs seem to indicate just that. Mukesh Dhirubhai Ambani’s largest start up in the world Reliance Jio Infocom Ltd (JIO) is the one of the biggest upheavals that has happened in the Indian telecommunications ecosystem ever. With its operations of scale and low cost services, there just does not seem to be a better bet for the prudent Indian internet user. What is missing is quality of services, but, then that is the case also with all the major mobile and internet service providers in India, be it an Airtel or a Jio or a Vodafone or the public sector BSNL and MTNL.

Wired broadband internet subscriber numbers have been declining, while wireless broadband internet subscribers have been growing according to Telecom Regulatory Authority of India (Trai) data. Among the top five wired internet services providers in India, BSNL and MTNL have been slowly and steadily losing subscribers. However, the overall loss of wired broadband subscribers is higher than the numbers bled by these two public sector behemoths. Subscription numbers of the other three players in Trai’s top five wired broadband internet service providers list such as Bharti Airtel, ACT and Hathway have been either increasing slowly or have been steady month-on-month in calendar year 2018 according to Trai data. MSOs and LCOs are among the other wired internet service providers in the country. Financial numbers released by major and other MSO and wired internet service providers such as Siti Networks, Den or Ortel indicate lower revenues from their respective broadband segments, implying either loss of subscribers or lower ARPU due to competitive pricing or both.

Is the laying of fibre cable or FTTH (fibre to the home) that Jio has planned to provide broadband internet services to the doorstep out the right way forward? Anything that Reliance does will be on a huge scale. However, why not pause and limit the size of Jio’s FTTH plans and then leapfrog and start offering 5G services? 5G is a wireless service to the user’s door and needs no messy holes or wires for access into the user’s home. All that is needed by the user is a modem that works like a wireless modem.

Affordable 5G services could effectively change how a user receives internet and related services. It’s not going to be easy and will require a huge amount of capital for the infrastructure for line of sight transmission in crowded cities, etc. But, already players such as AT&T and Verizon in the US have planned a slow but steady rollout of 5G services in the US. One the US majors will roll 5G services first in four cities by the end of 2018 and then across the US over time. Players in the US are planning to bundle 5G services with offers such as free Youtube.com TV and Apple TV 4K for a limited period of time. Jio has the resources, the wherewithal to do so.

Of course 5G could be even more bad news for the current Indian cable TV ecosystem’s wired broadband offerings, maybe even the current Indian media and entertainment ecosystem, but could be a huge beneficial and cost effective game changer for the user. Using the cliché, change is the only constant, well maybe the entire ecosystem that brings entertainment to the common Indian does need a huge shakeup?

August 17, 2018
TRAI: Make STBs, content & telecom services disabled- friendly

MUMBAI: With an aim to make communications and TV services more accessible to people with disabilities (PWDs), the Telecom Regulatory Authority of India has come out with a series of recommendations, including a confusing one suggesting that 50 per cent TV channels to be developed in PWD-friendly and accessible format over the next five years.

In its recommendations, the TRAI suggests that manufacturers maintain accessibility standards for set top boxes (STBs), mobile phones and landlines. Box makers have till 2020 to make or import at least one model in different variants in an accessible format.

Telecom service providers (TSPs), MSOs and DTH operators have been exhorted to have special desks in their call centres/customer support to assist PWDs using assistive technologies. The call centre executives must also undergo sensitivity training to deal with their issues.

Broadcasters, too, could well have to invest in content modification. According to TRAI, “The Authority is of the view that there should be phase-wise, time bound plans to develop percentage[s] of channels with the aim to have 50 per cent channels in accessible format in five years’ time frame. To start with, there can be five per cent [of TV] channels in accessible format in one year, 10 per cent in two years and 50 per cent in five years.”

When Indiantelevision.com got in touch with some TV channels on the issue, most of them said this particular TRAI suggestion on percentages of the TV channels in accessible format was not clear.

“Does TRAI mean that half of all the government-permitted TV channels would have to have closed captioning of content for PWDs, for example? Or, does it mean that a percentage of the content in a TV channel would have to be in a prescribed format? Or, does it mean that newer accessible channels or separate feeds would have to be started? As it’s difficult to have closed captioned content for news channels, for example, no matter how much a TV channel may like to be PWD-friendly, this suggestion would need further clarifications as it would mean increasing costs on making content,” a TV channel executive opined, adding, though TRAI’s intentions were laudable, an industry reeling under a slow economy would need financial incentives from the government to implement such a suggestion.

Meanwhile, continuing with TRAI recommendations, the regulator has suggested that Department of Telecom (DoT) and Ministry of Information and Broadcasting (MIB) instruct TSPs DTH operators and MSOs to conduct awareness campaigns regarding accessibility issues, design, affordability, availability of assistive tools and products, and about various government policies and schemes pertaining to accessible ICT (information, communications and telecoms) services that can be availed by PWDs.

The government has been exhorted to take several major steps. The most important one is that all government websites need to be PWD-accessibility compliant. ICT products (computer hardware, mobile phones, STBs, etc.) procured by government agencies should be accessible to PWDs and should have associated support documentation and services inaccessible format.

The government has been suggested to mandate the device manufacturers/importers not to curtail the accessibility features available in popular operating systems in any manner from their devices whether manufactured locally or imported.

Suggestions by the International Telecommunication Union (ITU) such as products and tariff plan specific to PWDs, appropriate customer care service, adding closed captioning, audio description, etc. should be taken up in India as well, TRAI has observed.

As mobile phones have become an integrated part of modern lifestyle, accessible handset for PWD citizens is also a necessity. According to TRAI, mobile handset manufacturers, who produce five or more than five different models, should produce at least one mobile handset satisfying accessibility criteria for PWDs at least by the end of 2020.

The regulatory body has recommended a steering committee, comprising various government agencies and ministries, for a timely review of accessibility of ICT services to PWDs. The committee will look into other areas, including fund requirements and collaboration with state governments, the regulator has suggested.

However, there’s a catch to this set of recommendations. As the issue was taken up suo-moto by TRAI, it needs to be seen whether MIB and DoT, for example, accept these recommendations of the regulator in any format at all as the two government organisations themselves are part of another panel looking into issues relating to PWDs vis-à-vis ICT services.

July 9, 2018
Tata Sky mulls fresh petition against TRAI tariff rollout

MUMBAI: Indian DTH operator Tata Sky is exploring options of filing a fresh petition in Delhi High Court against a Telecom Regulatory Authority of India directive to implement a new tariff regime from 3 July.

Industry sources indicated that though Tata Sky withdrew its petition filed in the morning, it could again move the court protesting on various grounds the rollout of the TRAI tariff regime.

The Delhi court, which is still to pronounce a verdict in a case relating to tariff and inter-connect orders of the regulator after being moved by Tata Sky and Airtel Digital TV over a year back, however, today refused to entertain the DTH operator’s fresh contempt plea against TRAI and said if the petitioner wished it could file a fresh petition.

Tata Sky had pleaded that TRAI media statement, issued 3 July 2018 directing broadcast and cable industry stakeholders to start rolling out the new tariff and inter-connect regimes with immediate effect, amounted to contempt of the Delhi High Court.

TRAI yesterday had said in a statement that its long-pending tariff and inter-connect orders, first issued in 2016, was to be implemented from 3 July 2018 with stakeholders to follow deadlines mentioned in the directive. The regulator had justified its stand by saying all necessary judicial compliances too were followed.

“Having complied with the judicial mandates in the matter, the Telecommunication (Broadcasting and Cable) Services (Eighth) (Addressable Systems) Tariff Order, 2017 and the Telecommunication (Broadcasting and Cable) Interconnection (Addressable Systems) Regulations, 2017 as upheld by the Hon’ble Madras High Court and the Telecommunication (Broadcasting and Cable) Services Standards of Quality of Service and Consumer Protection (Addressable Systems) Regulations, 2017 come into effect from 3rd July 2018,” the TRAI statement had said.

The statement had further stated that “in compliance to the direction” of the Delhi High Court, the regulator had “duly filed an affidavit” on 3 July 2018 in the court on implementation of its tariff and other related orders as they were cleared by another high court.

Meanwhile Star India, also expected to open up another legal front at the Supreme Court on the tariff issue, hasn’t yet made a move.

Still, industry people do admit that though TRAI may have directed implementation of its new tariff regime, but there is lack of clarity on the issue of 15 per cent cap on discounts offered by broadcasters on the prices of TV channels.

While upholding TRAI’s right to give directives on tariff-related matters, Madras High Court had given a thumb down to the capping of discounts offered. While stating that its tariff order was to come into effect from 3 July 2018, the regulator had not clarified whether the discount cap stayed or was done away with.

Keep tuned in for more developments on the tariff issue as it refuses to go away or get settled once and for all.

Also Read:

TRAI says b’cast & cable tariff, inter-connect orders come into effect 3 July

Star files caveat in Supreme Court on TRAI tariff order

Third Madras high court judge gives TRAI tariff order thumbs up

July 4, 2018
DEN Network fixed-line b’band biz plan hinges on partnerships & leveraging present infra

MUMBAI: With telcos handing out data at cheap rates in various package sizes under innovative schemes, mobile data consumption has increased rapidly in India in the last few years, while the growth of fixed-line broadband (FLBB) users has been tepid, if not completely static. MSO DEN Networks now wants to tap the hitherto unexplored opportunities of FLBB as a business proposition. So, what’s the plan?

Not only DEN wants to use its own and partners’ customer bases in 100 small cities of India, but is also, probably, eyeing the huge FLBB market that will open up as the Indian government ramps up its BharatNet project to provide Internet and broadband services to approximately 250,000 gram panchayats or local village administrations through state-run telcos and third-party service providers, including cable operators.

The reason for hi-speed broadband in 100 cities in 10 Indian states is to try overcome the low returns in big cities and metros. “We have also seen a lot of stress in the fixed line broadband ARPUs of all the major metros, be it Mumbai, Delhi, Bangalore [and] Kolkata,” DEN Networks CEO SN Sharma said during a recent analyst call, going onto add that the ARPUS were low in the “top 10 towns of the country”.

In April, DEN Broadband Pvt. Ltd, a subsidiary of DEN Networks, had announced expansion of its hi-speed internet services to 100 cities across India. After completion, DEN Broadband aims to enable 1.1 crore (11 million) Indian households with high-speed broadband services by 2020 with 20 MB speeds on an average under different sets of packaging and schemes — in contrast to average lower offerings from various telcos.

And, to back its claims, DEN Networks quotes data from international and domestic sources. In a presentation made to investors, the Sameer Manchanda-founded company justified its focus on FLBB by saying that if regulator TRAI’s December 2017 data was to be believed, there were 425 million wireless Internet subscribers, while there were only 18 million FLBB subs. Over the years, Indian FLBB growth has remained static compared to its APAC peers like Australia, China, Vietnam and Thailand.

So, how is DEN going to go about its FLBB plans in 100 cities? The company plans to leverage its existing cable universe and tie-ups with last mile operators by going the franchisee model, leveraging present infrastructure (80 per cent already fibre-enabled), and lower capex and operational costs. Affordable technology like Metro Ethernet and GPON, coupled with standardized technical solutions, customer support from DEN and a pre-paid collect model on B2C basis, according to the company, would make good business sense.

“We have a plan to enable 15 towns in the first quarter. Overall, 100 towns have to be enabled, and you will be surprised that LCOs themselves are approaching us,” Sharma informed an analyst, adding that it was not just a one-way traffic as company execs too were tapping LCOs informing them of the benefits as the infrastructure is already in place and the project could have additional revenue spin-offs for the LCOs. DEN has earmarked Rs. 100 crore (Rs.1 billion) as capex for the FLBB project over the three-year period.

What is fueling DEN’s aspirations? Quoting Singapore-based Media Partners Asia figures, the company presentation told investors that there had been

15X rise year-on-year in Internet data traffic in 2017 with video content contributing 65 per cent of total mobile data traffic apart from the fact that India’s FLBB penetration was expected to increase to 10.3 per cent from the present single digit share by year 2022. Moreover, as content and applications keep getting heavier and denser in size, FLBB high speed broadband solutions could be ideal for offices and homes.

“Our fiber is just 100 meters away from each of the subscriber that is being served by us,” Sharma explained to analysts, adding with broadband ARPUs low in metros and bigger cities it was decided to target the rest of the country that is not only a “virgin area” but has “equally good” demand.

Asked about Reliance Jio’s ambitious plans to rollout broadband services in the country, which can disrupt this segment too, Sharma refused to comment, saying, “I am nobody to comment on others business.”

Also Read :

DEN expands broadband services; plans Rs 100 cr capex

Aim to take phase 3 ARPU to phase 1 value: Den Networks’ SN Sharma

DEN readies Android-based STB for Feb launch

TDSAT rules in favor of DEN Networks, directs ZEE entertainment to provide channels on RIO basis

June 19, 2018
Hathway plans to seed 2.5 lakh high definition set top boxes in FY19

MUMBAI: Going along the lines of FY18, broadband and cable TV service provider Hathway Cable and Datacom is planning a Capex of Rs 310 crore in FY19. In addition to that, it plans to seed 2.5 lakh high definition (HD) set top boxes (STB) in FY19. The company had 2.16 lakh HD subscribers at the end of March 2018.

While in FY18 Hathway spent Rs 225 crore on broadband business and Rs 85 crore on the cable TV business, the company has a similar planning of expenditure in both the business for FY19. The company had 7.2 million cable TV subscribers along with a broadband subscriber base of 0.8 million.

“In FY18, we spent around Rs. 225 crore in broadband capex and around Rs. 85 crore in video business capex. We intend to spend similar capex in FY2019 as well. In terms of addition of consumers, we have seen good momentum so we are confident that this momentum will continue in FY2019 as well,” Hathway Cable and Datacom MD Rajan Gupta told analysts during an earnings call.

The company is focusing on four key markets including Maharastra, Mumbai, Karnataka, Bengaluru, Hyderabad, and West Bengal.

Due to the inability to implement the Telecom Regulatory Authority of India’s (TRAI) upcoming tariff order and regulations, a number of MSOs may collapse. Taking the opportunity, company is looking to acquire customers of MSOs to increase market share. Along with increase in market share, increase in average revenue per user (ARPU), HD STB seeding will play key role in the subscription revenue growth in next fiscal year.

More importantly, Gupta revealed that the company has closed content deals with broadcasters for FY19. While net increase in content cost for FY19 will be Rs. 40 crore, however, there will be no increase in content cost for two to three large broadcasters.

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Hathway CFO Vineet Garg resigns

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