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Star, Hathway, INCableNet form alliance to fight underdeclaration

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MUMBAI: Underdeclaration - the monkey on the backs of broadcasters and, apparently, MSO's as well, may well have a solution if an initiative announced today proves successful.

Lead broadcaster Star India, Hinduja group MSO INCableNet and Hathway Datacom (in which Star officially has a 26 per cent stake) have formed a joint action group to counter under-declaration of subscriber numbers in Mumbai.

Star India COO Sameer Nair said the coming together on a common platform to address this vexing issue was the result of ongoing discussions in process for the last few months.

Every tale has a villain. And for these foes turned partners, it is the local cable operator (LCO) who happens to control the last mile of connectivity. INCableNet COO Rajiv Vyas said: "Today there is a leak in the value chain. It is this inherent inefficiency that we hope to tackle so that every one in the value chain gets their proper revenue share." According to Vyas, "leakage" (read underdeclaration at the LCO level) was to the tune of 80 per cent on an average and it was essential for the long-term survival of the industry as a whole that it be plugged.

Elaborating on the common strategy that the three had worked out Hathway MD Jayaraman said this system prevents LCOs from switching over to a rival MSO to get off from paying pending dues or where negotiations are on for increasing declarations.

Queried as to what prevented the errant LCO from switching over to Zee Group cable arm SitiCable, Jayaraman clarified that all the MSOs were working together on this initiative though it was IncableNet, Hathway and Star who were leading the effort.

When it was pointed out that this appeared to be essentially an understanding that the MSOs would not interfere in each other's areas of influence and Star did not appear to have much of a role in the implementation process, Nair clarified: "Star's being in the picture checkmates a common tactic employed by the LCOs of procuring (set top) boxes directly from the broadcaster when in dispute with an MSO."

Jayaraman stressed that while there would be resistance to the moves from the ground level operators, the message that was being conveyed was that if the industry did not evolve a self-regulatory mechanism, the government would ultimately step in and introduce legislative measures.

Nair summed up the aim of the initiative by saying: "We are happy to be a part of this exercise taken by the MSOs and will give all help in order to ensure that each link in the distribution chain receives a fair share of the revenues without burdening the consumer with higher costs."

When posed a direct question as to whether Star would desist from going in for its annual price hike from 1 January 2003 if the present effort was a success, Nair would only say: "Our aim is not to increase rates next year."

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