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Regulation will continue to be a challenge in India: Reliance's Rajesh Sawhney

MUMBAI: On the occasion of India being the country of honour at next month‘s television trade event Mipcom Indiantelevision.com is doing a series of pieces on what the leading figures in India‘s television and entertainment industry feel about the media scene.

The first one in this series is Reliance Entertainment president Rajesh Sawhney. He offers his views on regulation, as too the potential of the new digital distribution platforms.

Indian TV Industry overview: The stature of the Indian television industry will continue to grow in coming years. The Indian economy will grow at 9 to 10 per cent per annum. Conusumerism is on meteoric rise, which is fuelling advertising growth in general and on TV advertising in particular.

Digitalisation of cable, DTH and IPTV induction will see multiple growth in declared subsrcribers and subscription revenues. Revenue from advertising and TV subscriptions grew 17 per cent in 2006 to $4.2 billion; this figure is likely to more than double to $10 billion by 2011.

Regulation: Regulation will continue to be a challenge in India. While there are plenty of bullish figures for India’s pay-TV market, yet there are regulatory hurdles such as non-exclusivity of content on DTH or the price capping of pay-TV channels in the case of conditional access (Cas).

I advocate self regulation as far as content is concerned. The pricing of TV channels and bouquets is a tricky issue and the regulator has to see that there are no monopolistic or restrictive behaviour. The interest of the consumer needs to be balanced with the health of broadcasters as well as platform owners.

The digitisation of media: India is on the cusp of change. A digital revolution. DTH, digital cable and IPTV are realities today. These changes bring with them new level of technical sophistication and content production. It is being projected that India (which had 116-120 million television homes in 2006, of which 61 per cent have pay TV) will have 90 per cent penetration from an estimated 185 million television homes in 2015.

DTH, Digital cable and IPTV are three forces that are backed by capital, coporate horse power and regulatory will power. However, transition to digital technology will face trendous challenges from entrenched trade, consumer apathy, but also intensive competition.

On the IPTV front: The State-owned incumbents have a incumbency advantage, which they are frittering away. They own 50 m subs copper factory, but so far they have not shown much enterprise in making the copper factory evolve to provide triple play services. I feel that the private sector participation is key to growth of IPTV in India which is around the corner.

I feel that IPTV has a great future in India in long term. However in the short term, it will be DTH that will be key to driving consumer penetration.

DTH: DTH is an exciting market in India. It will also be a tough market with 6 serious players in the battle. The DTH satellite market is set to grow from 2.6 million subscribers in 2006 to 38 million by 2015. I also expect DTH to provide a new platform for new and innovative content to flourish in India. Content has been key to the success of DTH platforms in other markets. We will see how this plays a role in the evolution of DTH in Indian market.

Digital Cable: The introduction of Cas was scheduled to be done in a phased manner at least in three metros this year. But there seems to be a delay. Given the regulatory structure for cable industry, delays are inevitable.

Even the mom and pop nature of Indian cable industry is a hindrance in the roll out of efficient and effective digital cable networks.

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