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DAS phases face problems; Parliamentary Committee asks Govt. to make amends

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NEW DELHI: Even as there are consistent delays on the Home Ministry's part to examine security clearances for multi system operators (MSOs) and complaints of non-availability of reliable set top boxes (STBs), a Parliamentary Standing Committee has said suitable steps should be taken proactively to address the concerns of all the stakeholders in achieving the final phases of digitization within the envisaged time frame.

The Committee in its recent report said that about 50 per cent of the further demand of 110 million STBs required under the final phases of digitization is likely to be met by the domestic manufacturers, which is certainly an encouraging proposition.

Noting that the Telecom Regulatory Authority of India (TRAI) had found interoperability of STBs expensive and recommended financial interoperability, the Committee wanted to know the progress in getting inexpensive STBs as it had been informed that indigenous STBs would be made available in sufficient number.

Regulations notified by TRAI provide an exit option for a subscriber to change the operator/platform for any reason. The Committee said it had also been informed that the Department of Information Technology had issued a Request for Proposal (RFP) for the development of an indigenous Conditional Access System (CAS) to make interoperability of STBs possible and an Indian CAS is expected to be ready in about a year’s time.

The Committee noted the process of digitisation under Phase I and Phase II was not smooth as there was strong opposition from cable operators’ associations, non-acceptance of revenue sharing arrangements between cable operators and MSOs, and between MSOs and broadcasters, delay in filling of Consumer Application Forms, monopoly of few selected STBs manufacturers and service providers and opposition from some State Governments.

It had been informed that the Task Force for the final two phases will provide policy direction and take stock of the progress on a regular basis in order to implement the final phases in a professional manner.

The Committee noted that out of the four metro cities planned to be digital, digitization has been near total in Delhi, Mumbai and Kolkata. Chennai is yet to undergo the digital transition due to several pending court cases. Phase II of digitization was concluded by 31 March, 2013 in 38 cities spanning 14 states and one union territory. The Phase III and IV digitization process is now planned to be completed by December 2015 and December 2016 respectively.

The Committee noted that during Phase I and Phase II of the Cable TV digitization, the indigenous manufacturers were able to supply only 15 per cent of the total requirement of STBs and the rest were imported from various countries, mainly from China. As a result, complaints were received about the poor quality of STBs, their non-compliance to BIS standards, and absence of service/repair centres for STBs.

In this regard, to meet the growing demand of STBs in the country, the Ministry has reportedly taken a number of steps to promote the indigenous manufacturing of STBs, which include increasing import duty on imported STBs from five to 10 per cent, declaring STBs as a part of ‘Telecommunications Networks’ by the Department of Telecommunications on 30 June, 2014 and confirmation by the Department of Revenue on 13 August, 2014 by extension of the same under Sec 8(3) (b) of the Central Sales Tax, 1956 thus fulfilling the major demand of the indigenous STBs manufacturers for the creation of a level playing field vis-?-vis importers.

Moreover, the Department of Electronics and Information Technology had made it mandatory for the STBs to be BIS compliant for safety certification with effect from January 2014. The Information Technology Department had also entered into a contract with a domestic company to develop CAS domestically vide its order dated 24 July, 2014, which would be made available to the domestic vendors at $ 0.5 as against the current value of $2 or more.

The Committee also noted that in order to give time to the domestic manufacturers of STBs, the Government had extended the cut-off dates of digitisation, which for Phase III has been extended from 30 September, 2014 to 31 December, 2015 and for Phase IV from 31 December, 2014 to 31 December, 2016.

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