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Tag: Phase III

  • Videocon d2h armed with adequate STBs ahead of DAS III deadline

    Videocon d2h armed with adequate STBs ahead of DAS III deadline

    MUMBAI: Indian direct to home (DTH) operator Videocon d2h says it is fully geared up for Digital Addressable Systems (DAS) phase III, the deadline for which is 31 December, 2015. 

     

    The company expects Phase III to be 50 million TV household in terms of size.

     

    The Telecom Regulatory Authority of India (TRAI) in its recent communication expressed satisfaction at the progress of the seeding of set-top boxes (STBs) in Phase III areas. TRAI has also advised consumers of urban areas who are still receiving cable TV services without STBs to avail and install STBs before the cut-off date in order to receive uninterrupted TV/services. It has reaffirmed its commitment to meet the deadline.  

     

    It is anticipated that there will be a huge demand for STBs for the Digitisation phase III, and Videocon d2h STBs are available in the markets. TRAI has been taking steps to create awareness among consumers and stakeholders by holding workshops on the implementation of DAS and consumer outreach programmes.

     

    Videocon d2h executive chairman Saurabh Dhoot said, “We welcome the digitisation mandate by Government wholeheartedly and will continue to support this initiative. The latest communication by Government in reaffirming its commitment is encouraging. This will ensure world class services to end consumer and create a level playing field between DTH and cable.”

     

    Videocon d2h CEO Anil Khera added, “Consumers who are on analog cable mode can subscribe to a Videocon d2h Digital Set Top Box to access uninterrupted services before digitisation is implemented. Videocon d2h has ample STBs to cater to demand of the digitisation towns. Consumers can subscribe to Videocon d2h to avoid a black out of the analog cable services and enjoy the wide range of channels and services provided.”

  • TRAI urges urban consumers to get STBs by end of month; rules out extension of Phase III

    TRAI urges urban consumers to get STBs by end of month; rules out extension of Phase III

    New Delhi,: Firmly ruling out any possibility of further extension of the deadline for digitization of cable television, the Telecom Regulatory Authority of India today categorically said that cable TV services in urban areas in the country will be digital from January 1, 2016.

     

    In a press release Trai also advised consumers of urban areas who are still receiving cable TV services without Set Top Boxes to avail and install these before the cut-off date in order to receive uninterrupted TV.

     

    Trai said it had been taking steps for creating awareness amongst consumers and stakeholders by holding workshops and consumer outreach programmes about the implementation of DAS. Trai held a meeting with major stakeholders of the broadcasting and cable TV sector on December 1 with major stakeholders in the sector. Trai had earlier asked all stakeholders to inform it by 28 November for pending interconnect agreements or if they were facing any problems.

     

    The broadcasters, direct-to-home operators and multi-system operators were asked to carry out exhaustive consumer awareness programmes about digitization of cable TV services so that the remaining customers in the urban areas are able to install STBs before the cut-off date of December 31. 

     

    Broadcasters of TV channels were asked to send advance intimation by December 7 to the cable operators about non availability of TV channels for retransmission in analogue mode to the consumers from January 1, 2016.

     

    Trai noted that the progress of seeding STBs in DAS Phase-III notified areas is ‘satisfactory and a good number of customers are getting the benefits of digitization’.

      

    Trai said that while Phase -I had covered the four Metros of Delhi, Mumbai, Kolkata and Chennai by October 31, 2012; Phase II covered cities with a population more than one million (38 cities) by March 31, 2013.

     

    Phase -III is aimed at covering all Other Urban areas (Municipal Corporation/ Municipalities) except cities /towns/areas specified for corresponding Phase-I and Phase-II by December 31, 2015. The final phase will cover the rest of India by 31 December 2016.

     

    The list of urban areas covered under Phase III of digitization is available on the website of the Ministry of Information & Broadcasting (www.mib.nic.in).

     

    At the outset, TRAI said cable TV is one of the most popular medium of mass entertainment and education and there are presently more than 100 million cable TV subscribers.

  • TDSAT appoints advocate commissioner to examine subscription claims of Chirala MSO

    TDSAT appoints advocate commissioner to examine subscription claims of Chirala MSO

    NEW DELHI: An Advocate Commissioner has been appointed by the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) to carry out a sample survey of the SLRs of Chirala Cable Network, which is seeking signals of Taj TV, Eenadu TV, Maa TV and Sun Distribution Services.

     

    The Tribunal said Advocate Commissioner Tushar Singh would go on a date duly intimated to all concerned to Chirala town and its rural areas where the multi system operator (MSO) claims it has subscribers. All the parties may nominate their representative to accompany the Advocate Commissioner in course of the survey. 

     

    Singh will go to all panchayat areas named in the SLR submitted by the petitioner. In each area he will visit at least 10 houses named in the SLR and 10 houses outside the SLR to verify whether any one of them are the petitioner’s subscribers or they are taking their signals from some other MSO/LCO. 

     

    Listing the matter for 4 January, the Advocate Commissioner was asked to submit a report within three weeks and he will be paid, apart from actual expenses, an honorarium of Rs 30,000 per day.

     

    The order came on a petition by the MSO wanting the signals of the four respondents against whom it has filed these four petitions. The petitioner is operating in Chirala town and adjoining rural areas. The controversy between the parties is mainly in regard to the petitioner’s SLR in rural areas, adjoining Chirala town.

     

    The Tribunal noted that Chirala town falls under Phase III of the DAS regime and the rural areas adjoining it come under Phase IV. In Chirala town, the petitioner is getting Sun’s signals through A.C.T Digital. 

     

    During the proceedings, the petitioner filed two or three SLRs, which on verification by Sun are said to have been found incorrect. According to Sun, the petitioner does not have any subscriber in the rural areas around Chirala town and it is making an attempt to penetrate the rural areas on the basis of incorrect SLRs “which would make it very difficult for the broadcasters to raise their invoices.”

     

    The Tribunal also noted that the petitioner had once again filed a fat affidavit giving its latest SLRs according to which it has 3219 subscribers of which 1138 are in Chirala town and the rest in the rural areas.

     

    The ascertainment that the correct SLRs that should form the basis for determining the licence fee payable by the petitioner to the broadcasters is an issue of facts, which may be determined on the basis of evidences led by the parties.

  • MSO clearances finally cross 550 with less than six weeks left for completing Phase III of DAS

    MSO clearances finally cross 550 with less than six weeks left for completing Phase III of DAS

    New Delhi: The number of multi system operators has raced to 553 by 24 November from around 470 early this month, as the government races to prepare to meet the deadline of completing the third phase of digital addressable system.

     

    Of these, 230 have got ten-year licences with three provisional licencees getting permanent licences, and a total of 323 (against 246 early this month) getting provisional licences. One temporary licencee was also given permanent licence till 2024 after its area of operation was changed.

     

    Information and Broadcasting Ministry sources said it had still not received any formal communication of the Home Ministry’s decision to do away with security clearances for MSOs, while some had been given provisional licences pending certain formalities relating to shareholders and so on.

     

    According to the list put on the I and B Ministry’s website today, Kal Cables of Chennai and Digi Cable Network Pvt Ltd of Mumbai remain on the cancellation list. Scod 18 Networking Pvt Ltd of Mumbai has also been refused security clearance while SR Cable TV Pvt Ltd of Bangalore has shut down its business.

     

    Two MSOs which had earlier been granted permanent licences were permitted to change their areas of operation.

      

    The new entrants in the permanent licence list include Waltair Entertainment Pvt. Ltd for Phase II in Vishakapatnam; Den Manoranjan Satellite Pvt. Ltd of Pune for Maharashtra; and Seemanchal Digital Network of Purnea for Bihar.  

  • DAS Phase III drives STB demand in Q3 2015; India accounts for 97% shipments

    DAS Phase III drives STB demand in Q3 2015; India accounts for 97% shipments

    MUMBAI: The set-top-box (STB) market in the SAARC region has registered record growth in third quarter of 2015, as rapid digitisation in the Phase III cities of Digital Addressable Systems (DAS) in India is driving the demand for STBs. 

    With pay-TV industry in all major SAARC countries moving toward digitisation – mandatory or voluntary – STBs of all kind from SD to HDTV and hybrid boxes are witnessing steady and robust growth.

    According to new research report from Dataxis, “The STB Market in SAARC countries (Bangladesh, Nepal, India, Pakistan and Sri Lanka)-Q32015,” STB shipments to SAARC countries have witnessed 73 per cent quarter-on-quarter growth during the Q3 2015. In the quarter under consideration, 7.34 million STBs were shipped in the SAARC region with an estimated value of $176 million. 

    India leads the STB shipments for the period, accounting for about 97 per cent of the total shipments to the SAARC region in the September ended quarter of 2015, according to Dataxis. 

    Skyworth tops the STB shipments to SAARC in the Q3 2015. The company reportedly has plans to locally manufacture STBs for the Indian market. 

    Local manufacturing in India, which accounted for just five per cent of total STBs sold during the first and second phase of seeding, is showing steady growth in the third phase. Dataxis estimates that the sale of made-in-India STBs will witness growth up to 15 per cent in the fourth phase of digitisation.

    “Local STB manufacturing in India has increased almost fourfold in the third quarter of 2015, and this is in line with our expectations. As the deadline for the third phase digitisation nears, there is high demand for STBs from the MSOs and most of the independent and small size operators are coming forward to partner with indigenous brands,” said Dataxis media analyst Sreeja VN.

    The Indian government was also proactive during the period by promoting the make in India campaign in the sector. The decisions by three major DTH players namely Airtel Digital TV, Dish DTH and Videocon D2H to opt for indigenous brands have also boosted the Indian STB industry.

    Another notable trend, according to the Dataxis Research, is the increase in demand for High-Definition (HD) and Ultra HD STBs in the region. Dataxis’s analysis of STB shipment for the Q2 2015 and Q3 2015, depicts steady growth in the volume of HD STBs shipped to India. The rise in the number of HD and UHD STBs has also contributed to a rise in the average selling price of STBs to the country. 

    The key STB vendors for the quarter are Technicolor, Skyworth, Changhong, Huawei and Coship (international vendors), and Mybox, One-eIGHT technologies, Trend Electronics, Ridsys, and Willet Communications (domestic vendors).

  • Broadcasters ready to extend existing analogue agreements in view of tardy pace of agreements, DAS Task Force told

    Broadcasters ready to extend existing analogue agreements in view of tardy pace of agreements, DAS Task Force told

    New Delhi: With less than three months to go for the deadline of Phase III of Digital Addressable System, the Indian Broadcasting Foundation has said that broadcasters are ready to extend the existing analogue interconnect agreements with multisystem operators for transition from analogue to digital service in view of the slow progress in signing of interconnect agreements.

     

     The commitment was made in the last meeting of the Task Force set up by the Information and Broadcasting Ministry in its meeting on 22 September. The minutes of the meeting were placed on the Ministry website today.

     

    The meeting was presided over by special secretary J S Mathur who asked the Telecom Regulatory Authority of India (TRAI) to convene a meeting of broadcasters and MSOs resolve issues. (It may be recalled that TRAI had earlier asked both broadcasters and MSOs to approach it in case of any problems with regard to interconnect agreements.

     

    Referring to the low number of interconnect agreements, Mathur remarked that without signing of agreements between broadcasters and MSOs, the progress on digitisation was not possible.

     

    Agreeing there had been slow progress in signing of agreements with major MSOs as the latter were awaiting the decision in a case before the Telecom Disputes Settlement and Arbitration Tribunal, the IBF said broadcasters had signed provisional agreements with many applicant operators, who have digitised their networks under the condition that they would get registered as MSOs for DAS operation before the cut-off date for Phase III.

     

    IBF was asked to submit an area-wise list indicating the status of signing of agreements to the Ministry. The meeting was told that just 62 of the 300-odd multi system operators had signed agreements with broadcasters.

     

    Mathur expressed his gratitude to the Indian Broadcasting Foundation for developing the advertisement on cable TV digitization in Phase lll areas and airing it on their member channels. He said All India Radio and Doordarshan were already giving advertisements on cable digitisation on their channels and they need to scale it up. The IBF representative said the Ads had been planned in bilingual format but IBF will consider making it multilingual as requested.

     

    Joint Secretary (Broadcasting) R Jaya said as a next step towards publicity awareness campaign, broadcasters and MSOs should now inform the cable TV users in Phase III areas through scroll messages on their channels to get STBs installed in their homes before the cut-off date.

     

    Jaya mentioned that MSOs registration by the Ministry was open. In case broadcasters have entered into agreements with non-registered operators they should ensure that they have applied for MSO registration with MIB. She advised broadcasters to impress upon these operators to immediately register themselves as MSOs with the Ministry failing which they cannot operate digital services.

     

    Meanwhile announcing that the toll free help line is expected to start operating soon, Jaya told the meeting that seven regional workshops had been held so far with Nodal officers in different cities, and these officers had been advised to provide the right of way (RoW) to the MSOs/LCOs under the provisions of the Cable Television Networks (Regulation) Act 1995 and also give details of those Phase III areas in their districts where no registered MSO is operating.

     

    The nodal officials were told to disseminate a clear message that the cut off dates are final and the analogue cable viewers should change to digital before the cutoff date.

     

    She said twelve regional units including the central unit in Delhi have been established for monitoring the implementation of DAS Phase III areas under Mission Digitisation project.

     

    Referring to the fact that seven regional workshops had been held so far, she said Nodal officers were being advised to provide the right of way (Row) to the MSOs/LCOs under the provisions of the Cable Television Networks (Regulation) Act 1995 and, also intimate Phase III areas in their districts where no registered MSO is operating. The nodal officials were also told to disseminate a clear message that the cut off dates are final and the analogue cable viewers should change to digital before the cutoff date.

     

    The workshops have been held at Chandigarh, Lucknow, Ahmedabad, Jaipur, Bhopal, Shillong and Hyderabad. A workshop at Patna had to be cancelled due to elections in the state. The workshops had been successful in sensitizing the state nodal officers about their role and responsibilities In the pre and post digitization period in phase lll areas.

     

    The Siticable representative said broadcasters have not responded to their requests for interconnect agreements for phase III areas so far and so they are unable to fix the channel package rates and get the SAF and CAF forms filled up from subscribers as required under DAS regulations. He questioned the propriety of running of digital cable service by cable operators without first getting registered from MIB as per the DAS regulations,

     

    The representative of the Telecom Authority of India said it was up to broadcasters and MSOs to continue existing interconnect agreement even after transition from analogue to digital. He added that there was no impropriety in running the digital service by an operator before the cutoff date without registration from the Ministry.

     

    The representative of IMCL said it had signed 60% of interconnect agreements with broadcasters in Phase III areas. Regarding interconnect agreements with other broadcasters they requested TRAI to intervene.

     

    The representative of MOCF mentioned that MSOs were not signing interconnect agreements with LCOs and TRAI should intervene and prescribe a standard interconnect agreement.

     

    A representative of the cable operator association from Assam said since no agreements were being signed in Assam despite requests from MSOs, broadcasters should nominate a nodal officer to deal with the issue at regional level.

     

    ASSOCHAM said it had along with a Cable Operators Federation already started a Chetna Yatra which was planned mandatorily to cover 450 cities sensitizing the consumers and operators alike about the cable digitisation in Phase III areas by 31 December. He added that a comprehensive report on this will be submitted to the Ministry.

     

    Members made various suggestions about the awareness campaign. A representative of the local cable operators association from Assam said that to make this effective, the TV Ads should be in regional languages. He wanted to know whether the Chetna Yatra planned to cover north east also.

     

    A representative of ARTBI said it did not have the facility to dub the ad in different regional languages but said its member channels would run it if this was provided to them.

  • TRAI prefers industry-driven guidelines instead of mandating directives: SK Gupta

    TRAI prefers industry-driven guidelines instead of mandating directives: SK Gupta

    GOA: Even as he reiterated that there will be no further extension of date for the third phase of Digital Addressable System (DAS) slated for 31 December, 2015, Telecom Regulatory Authority of India (TRAI) principal advisor  SK Gupta stressed the need of industry-driven guidelines instead of those mandated by the regulators.

     

    Pointing out that many lessons had been learnt from implementation of the first two phases of DAS, Gupta also stressed that the consumer was king and all policy decisions including tariffs had to be made with him in mind.

     

    Addressing the concluding session of the Indian Digital Operators Summit (IDOS) 2015, through teleconferencing from Delhi, Gupta accepted a suggestion for the need of a ‘supra-body’ other than the Task Force to go into these issues and solve problems that arise during implementation. 

     

    IDOS 2015 was organised by Indiantelevision.com and Media Partners Asia from 24 to 26 September in Goa.

     

    Gupta was of the opinion that the consumer’s choice was neglected and he was forced to pay for bundling of channels or bouquets instead of a la carte rates, which may not give him the channels he wants.

     

    At the outset, he said that there the industry had seen a sizeable growth. “The number of cable households have gone up from 79 million in 2006 to over 101 million at present. The number of channels have gone up to over 800,” he said.

     

    However, he added that though the number of channels have grown to over 800 in India, the driver channels totalled to just around 50.

     

    Furthermore, he said that customer still face billing problems and it wasn’t easy for them to switch to another operator. “The stakeholders must jointly resolve these issues. It has to be understood that it will not be easy to get customer to pay more,” he said.

     

    Pointing out that the increase in average revenue per user (ARPU) is illusory, if the system was faulty, Gupta asked stakeholders to reflect on it jointly. However, he was quick to add that this may not be possible, given “the level of infighting within the sector.”

     

    Gupta also urged the broadcasting sector to take a few lessons from the telecom sector, which had also begun with lot of litigations but had then realised that collaboration was the only way to go ahead. “Today they are prepared to share and sell spectrum and have accepted mobile portability. As a result, there has been tremendous growth in the telecom sector,” he said.

     

    Speaking on broadband, Gupta said, “Lowering the price of broadband is do-able if set top boxes could provide both television and broadband. TRAI gave its recommendations in this regard to the Government in January this year. This will herald the start of a new era in broadband growth.”

     

    “Stakeholders need to realise that the concept of television or video watching is moving to mono-viewing,” he said.

     

    While it was for the stakeholders to find ways to get the customer to fill the Common Assessment Framework (CAF) forms, Gupta said that lessons learnt from the first two phases should help. TRAI would “like to see consensus,” he said.

     

    Gupta also said that while TRAI had its offices in many centres of the country, he would urge the Information and Broadcasting Ministry to send proper instructions to nodal officers in the Phase III and Phase IV areas. His remark came following a complaint that most nodal officers in smaller towns were still not clear about their role in DAS.

     

  • Mumbai to pay highest fees of Rs 36.7 crore for migration to FM Phase III

    Mumbai to pay highest fees of Rs 36.7 crore for migration to FM Phase III

    MUMBAI: FM operators in Mumbai will have to shell out the highest migration fees of Rs 36.69 crore, payable to the Information & Broadcasting (I&B) Ministry for migration from FM Phase II to Phase III.

     

    The I&B Ministry has released the city wise non-refundable one time migration fee (NOTMF) for migration from FM Phase II to Phase III for existing private FM broadcasters.

     

    According to the ministry, after Mumbai, Delhi FM operators follow with the second highest migration fee of Rs 33.33 crore, whereas Bengaluru is third in line with migration fee of Rs 21.60 crore.

     

    Apart from the top three, existing FM operators in 13 cities will have to pay migration fees of above Rs 10 crore. They are: Chandigarh (Rs 19.04 crore), Hyderabad (Rs 18 crore), Patna (Rs 17.89 crore), Coimbatore (Rs 16.87 crore), Cochin (Rs 15.04 crore), Nasik (Rs 14.66 crore), Lucknow (Rs 14 crore), Pune (Rs 14 crore), Ahmedabad (Rs 13.17 crore), Indore (Rs 13.06 crore), Chennai (Rs 12.27 crore), Visakhapatanam (Rs 11.68 crore) and Vadodara (Rs 11.30 crore).

     

    Additionally, FM operators in 47 cities will have to pay migration fees between Rs 10 – Rs 1 crore. They are as follows: Vijayawada (Rs 9.97 crore), Kolhapur (Rs 9.44 crore), Trivandrum (Rs 8.09 crore), Kanpur (Rs 8 crore), Jaipur (Rs 7.74 crore), Bhopal (Rs 7.49 crore), Kolkata (Rs 7.06 crore), Kozhikode (Rs 7.02 crore), Madurai (Rs 6.49 crore), Puducherry (Rs 6.49 crore), Aurangabad (Rs 6.23 crore), Tiruchi (Rs 6.11 crore), Rajkot (Rs 6.08 crore), Amritsar (Rs 6.03 crore), Trichur (Rs 5.65 crore), Varanasi (Rs 5.26 crore), Nagpur (Rs 5.10 crore), Mysore (Rs 4.66 crore), Tirupathi (Rs 4.50 crore), Mangalore (Rs 4.45 crore), Jalandhar (Rs 4.22 crore), Allahabad (Rs 4.08 crore), Kannur (Rs 4.05 crore), Jabalpur (Rs 3.80 crore), Surat (Rs 3.60 crore), Raipur (Rs 3.43 crore), Panaji (Rs 3.18 crore), Agra (Rs 2.56 crore), Shimla (Rs 2.34 crore), Jodhpur (Rs 2.05 crore), Asansol (Rs 2.02 crore), Patiala (Rs 1.64 crore), Rajahmundry (Rs 1.58 crore), Tirunelveli (Rs 1.57 crore), Gulbarga (Rs 1.50 crore), Tuticorin (Rs 1.50 crore), Gwalior (Rs 1.40 crore), Bhubaneshwar (Rs 1.27 crore), Jamshedpur (Rs 1.26 crore), Warangal (Rs 1.25 crore), Siliguri (Rs 1.05 crore), Udaipur (Rs 1.05 crore), Karnal (Rs 1.04 crore), Ranchi (Rs 1.03 crore), Rourkela (Rs 1.02 crore), Jammu (Rs 1.01 crore) and Kota (Rs 1 crore).

     

    The operators who exercised the option to migrate to FM radio Phase III will have an option to withdraw to migrate within five calendar days of intimation of the NOTMF. The option exercised by the operator who do not wish to migrate to FM radio Phase III shall be final and binding on the operators.

  • Red FM hikes ad rates by 35% buoyed by optimism post Phase III FM auctions

    Red FM hikes ad rates by 35% buoyed by optimism post Phase III FM auctions

    NEW DELHI: Even as the results of some of the Sun Group’s bids in the FM Phase III are being held back as the matter is pending in courts, 93.5 RED FM has implemented a 35 per cent hike in ad rates across all its stations. 

     

    The new rates became effective today (21 September).

    Red FM COO Nisha Narayanan said, “We have not had a rate hike for a while now. Today, radio as a medium is growing at a Compounded Annual Growth Rate (CAGR) of 18 per cent and attracts a large number of advertisers as consumption of radio is on an overall high. The demand and supply scenario has a huge imbalance with demand way beyond the inventory that we can play on Red FM. Also the advertisers have shown faith in us to provide customised solutions for their brands and do not have an issue in paying premiums.” 

     

    “With Phase III and newer cities we plan to venture into, we have decided to go ahead with rates hike of 35 per cent across the network. With strong hold in metro cities as well as Tier II and III cities, we will continue to provide customised quality solutions for all our clients across the network and hope to receive their support for the desired increase.”

     

    Narayanan further said these were very interesting times for the FM radio space as the advertising community has been showing its faith in the medium continuously, which is evident fromthe overflowing radio inventories. 

     

    Demand across most of major metro’s and big cities has seen growth, which is equivalent to festive season rush and thus there is an eminent reason for the rate hike, which have been stagnant for almost two to three years now. 

     

    Narayanan added the Phase III auctions and an overall optimism within the industry isalso going to put pressure on the operational expenses. Thus the rate hike is one of the steps that have become a necessity to optimise the demand and supply and offer best of entertainment and mileage to advertisers and stakeholders. “More and more volume is also coming from lot of new categories and it’s good to see their trust in the medium by planning campaigns with FM stations,” she added. 

  • Ground level challenges delay digitsation benefits to MSOs & broadcasters: ICRA

    Ground level challenges delay digitsation benefits to MSOs & broadcasters: ICRA

    BENGALURU: In a vast country like India, ground level challenges is a key reason that has delayed in multi-system operators (MSOs) and broadcasters reaping the benefits of digitisation. The digitisation of the TV distribution industry, initiated in 2011, is yet to achieve its target of addressability and transparency in billing systems, which was expected to yield significant benefits to MSOs and broadcasters as per a report by Indian investment and ratings agency ICRA on the Indian Media and Entertainment Industry – TV Distribution (September 2015).

     

    Some of the noteworthy points mentioned in the report are as follows:

     

    As MSOs struggle with last mile ‘addressability’ hurdles for its digitised customer base, the industry’s ability to deliver customised / value added content remains restricted. As a result, the expected benefits of higher subscription revenues for MSOs and broadcasters are yet to be achieved. The end consumers are also yet to benefit from targeted subscription packages, which were expected to optimise the user experience. ICRA believes that end consumers are also yet to benefit from targeted subscription packages. Roll out of channel packages by MSOs remains crucial for driving ARPU growth and profitability as content costs increase.

     

    Implementation challenges and slow progress in Phase I and Phase II markets have restricted monetisation for MSOs due to slow progress in Consumer Application Form (CAF) collections – effectively LCOs have retained their control over the subscriber base, disputes in sharing of entertainment tax, ARPU is constrained and as yet determined on per subscriber basis, and not on basis of channel packages chosen.

     

    While distributors have witnessed 25-30 per cent decline in carriage income, overall carriage income for distributors has remained buoyant because the disbanding of channels aggregators has given distributors leverage with smaller broadcasters and new channels. Also, new channel launches and wider audience measurement metrics will keep carriage revenues buoyant for MSOs.

     

    DTH players and regional MSOs are likely to take the lead in implementation of Phase III and Phase IV. Extension of deadline for Phase III and Phase IV markets provides adequate time for resolving ground issues as well as coverage for large subscriber base; however lower purchasing power and price sensitive nature of subscribers make investments less attractive. DTH players remain well positioned for tapping growth opportunities in Phase III and Phase IV markets due to inherent technology advantage and easier access to cable dark areas.

     

    Credit profiles unlikely to improve significantly on account of debt funded capex plans.  Longer than expected timelines in monetisation opportunities, higher content costs for digitised areas coupled with ongoing investments for Phase III and IV would keep the return and coverage indicators of MSOs muted in near term. 

     

    While a significant amount of equity funds supported the investments in Phase I and II markets for major MSOs, investments for penetrating Phase III and IV areas, broadband penetration as well as offering value added services (such as Video on Demand) may be largely funded through debt; correspondingly the borrowing levels are expected to remain high over the next two years while the profitability generation from digitised areas stabilise gradually.

     

    In spite of execution delays, in the longer term, digitisation is expected to benefit MSOs, DTH operators and broadcasters through greater customer wallet resulting in higher subscription revenues.

     

    Sizeable subscriber penetration opportunity persists in Phase III and Phase IV markets. The market share dynamics between MSOs and DTH players are expected to change with an uptick in run rate for DTH operators (approximately 20-25 per cent market share in Phase I/II) as the industry progresses towards the Phase III and Phase IV.