Television

'The commercialisation of IPTV will happen as we have a policy in place now' : Sujata Dev - Time Broadband Services Pvt. Ltd co-founder, CEO & MD

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Having stitched a deal with state-owned telecom major Bharat Sanchar Nigam Ltd (BSNL), Time Broadband Services Ltd (TBSL) is preparing for an IPTV roll out in 20 cities across Uttar Pradesh and the eastern region of India.

Armed with an investment from Dubai Investment Group, the company has worked out on the technology front with H.264 AVC, Verimatrix encryption system and Amino set-top boxes.

In an interview with Indiantelevision.com's Gaurav Laghate, TBSL co-founder, CEO & MD Sujata Dev talks about the challenges that are in store for IPTV operators in India and the company's growth plans.

Excerpts:

Why has a serious IPTV roll out not happened in India despite telecom majors like Reliance, Bharti and Tatas showing an interest in it for the last few years?

The commercialisation of IPTV will happen now as the legislation has thrown some clarity on the policy issue. The Telecom Regulatory Authority of India (Trai) has also given its recommendations. When these were still dark areas, the telcos were in the trial stage. A proper IPTV roll out should happen within the next six months.

Aren't there areas of concern as the government is yet to give the nod to some of Trai's recommendations?

The policy is not clear whether IPTV providers can downlink directly or it has to be churned through the cable operator. Then there is the pricing issue. We need a similar policy like it is for DTH or digital cable in Cas (conditional access system) areas. If IPTV has to compete with other digital addressable delivery platforms, it has to have a level playing field. For the same content, you can't have a different pricing.

There is also the 'must carry' clause for eight Doordarshan channels while in case of cable it is four. This will occupy 16 mbps (2 mbps per channel). Copyright for IPTV is another challenging area.

Time Broadband had a franchisee deal with MTNL for providing IPTV a few years back. Why no roll out happened since then while other players like IOL Broadband and Aksh Optifibre went ahead to launch their services?

Since there was no IPTV policy, we didn't want to launch commercially. There was no copyright definition for IPTV content. The technology was also evolving. Besides, MTNL worked out a different revenue sharing system with later franchisees like Aksh. We are sorting out our issues with MTNL.

What was the roadblock on the technology front?

We had decided on ADSL2+ technology. For a market like India where there is 2 mbps on the last mile, you will need H.264 AVC which was evolving as a technology. We have Amino set-top boxes (STBs) and Verimatrix encryption system.

Since you were under arbitration with MTNL, what was it that attracted Dubai Investment Group (DIG) to take a 40 per cent stake in your company through its subsidiary Dubai Ventures?

They were attracted by the knowledge base that we had acquired. DIG has a telecom and IPTV presence in many markets. Time Broadband will be the new technology company which will support their projects in different markets. We have launched IPTV over 2.5G mobile platform in Malaysia. They see us as futuristic telecom company.

'We are be profitable once we reach a 2.5 million subscriber base. For achieving this target, we will require an investment of around Rs 7 billion'

How much has DIG invested into the project and who are the other shareholders?

The company has pumped in close to Rs 1 billion. DIG will continue to invest. We will become profitable once we reach a 2.5 million subscriber base. For achieving this target, we will require an investment of around Rs 7 billion. Aniyan Kutty Kunju, the chairman of Jai Hind TV (a Malayalam news channel), is another shareholder.

How will you manage to have 2.5 million IPTV subscribers?

We have signed up with BSNL to roll out IPTV on their network across 20 towns in Uttar Pradesh and the eastern region of India. We are also looking at MTNL. Unlike the private telecom operators, these two state-owned majors have the last mile connectivity. Besides, as content aggregators we have the advantage of even doing business with all the telcos. We are also optimistic about IPTV on mobile phones once 3G opens up in India.

We have created a lot of content for mobile, as the screen and user habits are different. We have lifestyle, yoga, spiritual, music and sports content. We have tied up with IMI for music and different producers for other content.

What makes you so bullish when the private telecom operators like Reliance, Bharti and Tatas have jumped into DTH as they feel IPTV can have slow growth in the Indian market, at least in the short run?

The USP of IPTV is the interactivity which is not present in cable or DTH. IPTV has room for interactive and premium content. As for the telcos, they may work out a business model where they offer channels through DTH and rely mainly on interactivity for their IPTV success.

In Korea, gaming has driven IPTV while in Hong Kong it is exclusive and premium content which has brought in subscribers. In India, interactive services and e-learning may drive IPTV.

State-owned telcos BSNL and MTNL have gone in for non exclusive franchisees to develop their content delivery network. Do you see business feasibility for all of them?

BSNL and MTNL are limiting their franchisees. Some of the franchisees may have entered to boost their value as they are listed entities. We are in as we see a serious business opportunity in IPTV. We realise that with low ARPUs (average revenue per user) and subsidy on STBs, profitability can come only after five years. IPTV is more part of telecom. We have a serious investor in DIG and have a business plan knowing the hardships of the Indian market.

For acquiring content like movies, how successful have you been to work out revenue share arrangements with rights owners?

We believe that is the best model to be in. We have done some deals along these lines. There can also be a MG (minimum guarantee) system for a certain number of subscribers, after which a revenue share model can be arrived at.

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