He may not look like an average geek, sitting in his plush woodwork-heavy office room in the office complex of Zee Telefilms in Noida, on the outskirts of Delhi, which also is the home for Zee News, Zee Sports and the hub of uplink activities for the network. But Jawahar Goel, one of the younger brothers of Zee promoter Subhash Chandra, is a technology freak. As a person spearheading the network's distribution and DTH businesses, Goel needs to have such an understanding and he goes about it all with a childlike eagerness to learn more.

Even as Goel fiddles with his slim laptop, which is not only wi-fi enabled, but also equipped with Reliance's CDMA phone card to dial up Internet when he's outside Delhi, his thought process doesn't waver from the topic of conversation. "Technology is a great asset. It gives you access to information that would have remained outside one's domain earlier," Goel gushes as he sifts through his e-mails, quietly smiling to himself at times, digesting the information.

A street-smart businessman, Goel is said to have been the hardest negotiator on behalf of Chandra during board meetings when Siti Cable was 50 per cent owned by Rupert Murdoch in the late 1990s. And tales of his performances at Siti Cable board meets, at a time when R Basu was the CEO of Star India, are legendary. At one such meet, where financial aspects were being discussed for the cable arm's expansion, senior Star representatives were said to have walked out frustrated after miserably failing to match Goel's stridency.

In this interview with Indiantelevision.com's Anjan Mitra, Jawahar Goel holds forth on various aspects of the distribution business in particular, and broadcast industry in general.

Excerpts:

What's your overview of the cable and broadcast industry as of today?
If the latest NRS data is to be believed, then it indicates good tidings as it signifies growth. (In its latest report National Readership Survey has stated that India presently boasts of 61 million C&S homes.) But the figures would also mean that the cable industry has to smarten its tactics as in the coming time there would be tough competition from new technologies like DTH.

The cable industry has grown in a haphazard way over the years, but the time has now come for consolidation to take place and to think of the future instead of sitting on past laurels.

If we calculate for 61 million cable homes at an average payout rate of Rs 200 per home per month, I'd say the cable industry's turnover at present would be slightly over Rs 15,000 crore (Rs 150 billion). Please remember that this figure stands true only for the cable business and I am not including the broadcast part of it. It's not a small figure, nor a small industry. If the industry doesn't mend its ways and plan for the future, bottomlines in the cable business would be under pressure over the next two to three years.

Though NRS is saying that the C&S homes have grown, how would you rate 2004 as a year?
Year 2004 was a difficult one for the cable industry. It does not need an understanding of rocket science to realise that. The freeze mandated by the Telecom Regulatory Authority of India (Trai, the broadcast regulator) and the after-effects of the CAS fiasco had built up pressure on everybody in the cable industry, including the last mile operator (LMO). For the MSO, it was like getting sandwiched between the demands of pay broadcasters and the inadequacy of the LMO to cough up additional money because of subscribers' reluctance to pay more.

We managed to see the year through by having an informal understanding amongst MSOs, which also brought about some synergy. As long as the industry shows unity in some form or other, it would stand to gain. But the irony is that unity is a word that is quite alien in the cable industry, which helps other segments of the broadcast industry to take advantage of us.

Why do you feel that services like DTH would put pressure on cable TV as new technologies are seen as niche businesses?
DTH might be a niche service now, but over the years, it would have substantial amount of market share in the overall TV universe. I am looking at the future and feel that by middle of 2006 when other DTH services would have also come up, there would be at least a five per cent shift of consumers from cable. By the end of 2007, the shift would increase to 10-11 per cent.

As per your calculation, the rate of shift to DTH from cable is quite fast? Any particular reason for this reasoning?
Foremost reason for this shift is the mode in which a cable service is delivered. Analog mode of delivery would never be able to match the digital finesse of a DTH service. Another reason is the lack of bandwidth available with the cable industry. This inadequacy has resulted in a failure to accommodate the growing number of TV channels on an average cable network.

Big MSOs like Siti Cable, Hathway and INCablenet may have started the process of digitisation, but what about the LMO who is bringing the service into homes? With consumers also not in a mood to acquire boxes to enhance channel receptivity, it has led to a situation where other malpractices have cropped their ugly head in an aggressive way. This lack of bandwidth has led to the growing demand for carriage fee and I'd say that this year the distribution budgets of TV channels, including carriage fee, is the highest ever in the cable industry's history.

In such a scenario, when a consumer with decent capacity to afford a premium service, samples a service like DTH, which is digital and offers a different kind of viewing experience, he would make a go for it.

What, according to you, should be done by the cable industry to put up a fight for the market share?
Digitisation is the mantra. In an analog mode, which is what our services are presently on, channel offerings would not grow beyond a point and the lack of this growth would also hamper the overall growth of the cable industry. Realising this, probably, Trai has suggested that a future roadmap for digitisation should be set in motion. As far as my understanding goes, Trai is looking at migration to a digital regime in a phased manner. It's hoped that by the time 2010 comes, when Delhi is hosting the Commonwealth Games, partial digitisation of cable networks would have taken place.

Otherwise, big channels with deep pockets would chew away limited bandwidth giving rise to more problems.

Sector regulator's suggestions are fine, but the government too has to be willing to implement them in the form of policies. What do you have to say on this?
I agree with you that the government and our policy-makers also need to be sensitised to the problems of the industry, which is not happening.

Former I&B minister Sushma Swaraj wanted to break the monopoly of the pay broadcasters and mooted CAS or addressability. Her successor, Ravi Shankar Prasad (belonging to the same government in Delhi) suspended CAS because of elections and now the present minister, Jaipal Reddy, would like to pursue digitisation because of increasing number of TV channels. However, the cable industry would like to believe in the promises when they are finally delivered by our politicians.

When the LMOs and smaller cable operations start facing losses (because of subscriber shift to DTH, for example) , then they may wake up to reality. But consumer shift is inevitable. At Dish TV (20 per cent owned by Zee Telefilms) we are experiencing this `shift' trend as consumers are lapping up Dish TV's DTH service, even in urban areas where cable TV has been thriving.

Still, when digitisation is talked about, I feel, it's being done so more for the sake of sampling than a serious pursuit at this moment.

What are the types of services that you think cable service needs to offer to be an effective competition?
Cable TV has to migrate to an addressable system where pay-per-view option is given to subscribers. Apart from that radio channels, electronic programming guide, tele text, channel expander devises, and other such value-added services need to be provided.

But aren't these services similar to a DTH service ?
Yes, they are. But that's the future. Cable has to raise its standards from the present to compete effectively with other services like DTH, broadband and still continue to be a viable service. And, for this digitisation is as important as having an addressable system. Though, broadband is a service that I don't think will become even near-mass product over the next two years.

Will the consumer, who is not ready to pay even more channel enhancing devises, be willing to cough up for such digital services on the cable?
In the initial phase, such add-on services over cable might have to be subsidized, but ultimately it would go. When the subsidy goes, people should be offered what they are willing to consume. For that to happen, I reiterate, digitisation of the whole system is important.

Is Siti Cable gearing to become an MSO of the future?
At the moment, we are in the process of becoming digital-ready and hope that by end 2007 we would have been partially successful in doing that.

Is there a possibility of revisiting a proposal to make Siti Cable a public limited company, as had been mentioned a couple of years ago by Essel group chairman Subhash Chandra?
As I said, we are readying ourselves for the future with technology. By end 2007, it (Siti Cable) could be a candidate for becoming a listed company after it's spun off as a separate company. At the moment, Siti is very much part of Zee Telefilms, contributing its share of revenue to the overall kitty.

What would be Siti's share of revenue?
I would not be able to talk about numbers at this point of time.