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Key issues covered as Ficci Frames 2001

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The two-day global convention on the business of entertainment organised by the Federation of Indian Chambers of Commerce and Industry (FICCI) concluded Saturday with a number of key issues being discussed.

The event was a grand success which was reflected by the kind of attendance as well as the animated debates the convention witnessed on issues critical to the future of the entertainment industry in India.

There were some key points which came out of the convention some of which have been covered here.

Speaking for the government while inaugurating the convention Friday, minister for information and broadcasting Sushma Swaraj admitted the government needs to do more to give a fillip to the industry.

She identified the problems the industry was facing as problems of finance and insurance, unrealistic tax laws, inadequate infrastructure and problems in copyright laws and their implementaion while urging more steps towards corporatisation.

BROADCASTERS WORRIED

One of the crucial discussions at the FICCI meet on Friday was on the regulatory framework for broadcasting.

The speakers were RK Singh, CEO, Zee Telefilms; Kunal Dasgupta, CEO, Sony Entertainment Television and Kiran Karnik, CEO, Discovery Channel, with Anil Baijal, CEO, Prasar Bharati as the moderator and representing the government viewpoint.

Baijal highlighted the policy advancements in broadcasting but also accepted the fact that a lot of policies needed a relook and needed to keep abreast of the current developments.

Singh pointed out that the regulatory framework was not keeping pace with the advances in technology.

As a case in point Singh referred to the recently announced direct to home (DTH) broadcast guidelines. There were so many controls that the impetus was just not there to go ahead, he said.

"International experience shows that the more the regulation the lesser the development of this sector," Singh added.

Karnik pointed out the industry's worries on the convergence bill which is in the process of being finalised, particularly the issue of content regulation.

Karnik said the need was more for self regulation which was already in place in the advertising and programming fraternity and not for the government to come and lay down the law.

Codes shouldn't be left to the regulator because it is very difficult to clearly identify terms as vague as Indian culture/ values/ morality.

And the kind of fines which were being envisaged (Rs 500 million) for "defaulters" meant it was better to lose your licence than face paying the fine, Karnik pointed out. The licence fee for starting a DTH operation is RS 400 million.

Karnik was very emphatic that there was an urgent need to have the bill out sooner rather than later because it was already too long in the making.

He said in the event of delay a way out could be an ordinance which would set down the rules of the game till such time as the convergence bill becomes law.

Karnik suggested that the Cable Networks Act be amended to protect the end user - the viewer.

And finally he proposed the constitution of a professional body to handle issues like monopoly, tariffs and regulation till such time as the convergence commission is in place.

Dwelling on the recently issued DTH guidelines, he said it completely ignored the internet and radio, just two of the important platforms on which DTH could be propagated.

Defending the government, Baijal said the subgroup headed by Fali S Nariman was already discussing these issues.

FUTURE DTH SCENARIO

Kunal Dasgupta developed further on the future of DTH but clarified that at this point he didn't see his channel going in for it.

Dasgupta said DTH was bound to fail unless it was rolled out as a multi-platform convergence application.

The advantage of DTH was only if it was viewed as a multimedia tool. Dasgupta quoted the example of France where it was a bundled software aggregator having XML, IP protocol, TV protocol, streaming media, video on demand, gaming and pay per view.

Queried on what was the breakeven time frame for DTH operations Dasgupta said it was a function of penetration. If it were a single player (consortium?) a 1.8 to two million subscriber base would be where it would be achieved. However, if there were more than one player it could take over seven years for breakeven to be achieved.

And the cost - RS 6,000 million for operational set-up and another RS 6,000 million as further costs in development and distribution.

DTH AND THE LAST MILE

In a discussion on DTH and The Last Mile held Saturday, Ashok Mansukhani, CEO, Indusland Entertainment, estimated the cost of setting up a DTH operation at a lower RS 3,500 million.

Looking at the example of the United States, Mansukhani said there were only two major DTH providers supplying 225 channels. Mansukhani said he saw only a single DTH player, probably by way of a consortium, establishing itself in the near term. He echoed Dasgupta in saying that there was little to make DTH more attractive than cable unless there was a significant addition of value added services.

Mansukhani saw cable broadband is having a much more realistic growth potential than DTH which, according to him, would only come as added carriage.

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