may sound Utopian, but the Entertainment Report, put
out by the Confederation of Indian Industry (CII)
and Ernst & Young, believes that a self-regulatory
body comprising MSOs and broadcasters can solve most
of the ills plaguing the television industry in the
The report, EnterMedia 2001, was released yesterday
during the inauguration of the two-day conference
on "The Business of Entertainment" organised by the
CII in Mumbai.
The report suggests the following measures that can
bring about a healthy MSO-broadcaster relationship:
issue of under reporting of the subscriber base, which
has been the cause of friction between the MSOs and
broadcasters can be tackled by developing a model
for channel pricing, the report says. This can be
achieved by taking into account channel TRPs, viewership
demand, and service tax, competition and entertainment
duties. Such a model will benefit both parties due
to comprehensive coverage of all aspects.
The new system that is envisaged presupposes regularly
updating of the subscriber base through the MSOs to
the broadcasters, increasing awareness of IPR legislations
among cable ops through leading channels and developing
a rating measurement system that reflects the true
worth of a programme.
Again, the report leaves the finer and more tedious
business of developing such a model to a happy co-operation
between the two warring parties.
For direct to home broadcast to become a viable option,
the report recommends that the government reconsider
the 20 per cent cap on broadcasters' equity in any
new DTH venture, which restricts the primary investor's
majority shareholding. The government also needs to
create a level playing field to ensure that the first
player who invests in setting up a customer base in
an Open Architecture model does not suffer with the
entry of other players. DTH, the report notes, is
likely to throw up several problems like a mismatch
between the set top box design and the DTH service
configuration in the Open Architecture System. The
consumer's range of options is likely to be governed
by the alternatives permitted by the access card provided
by the DTH operator.
The report has a pat on the cable ops' back for laying
a network that reaches 40 million households in less
than 10 years, thus covering nearly half the television
set owning population in the country. At the same
time, it castigates the ops for the lack of proper
monitoring and supervisory system that has led to
underreporting, the main bone of contention between
them and the MSOs. On the issue of customer addressability,
the cable ops have the sympathy of the report, which
points out that MSOs are often arm twisted by broadcasters
into telecasting a 'bouquet of channels', including
even the ones that do not have adequate viewership.
What The government Can Do
Television content, which has burgeoned into a Rs
25,000 million industry, generating demand for 40,000
hours of original software for 43 channels in FY 2000,
needs to be granted 'preferred industry' status by
providing incentives similar to the IT software indstry,
the report says. Among the proposals mooted are:
Creation of special economic zones for TV production
Exemption of income on export of TV software for
a period of five years
Lowering of import duties on production equipment
similar to exemption on cinematographic equipment.
In Some Professionalism
The TV software industry needs an injection of professionalism,
the report says, mooting the setting up of technical
training institutes for improving the quality of content.
This sector is poised to register a strong growth
because of the increase in demand for content, programming
rates and revenues from ads accruing to content producers.
The report suggests the government's infrastructure
support in establishing such institutes will go a
long way in beefing the qaulity of software to international
The television content segment, essentially a seller's
market, will eventually regain a balance between demand
and supply following the imminent shakeout among the
channels. The report however warns that the segment
will come under tremendous pressure to keep up with
the demands of viewers.
It recommends that Indian content companies should
invest in infrastructure and expand operations rapidly
across media segments. At the same time, the report
says, they should aim to become global content players
by leveraging on their cost advantage and developing
content for the international market.