Cable TV

EnterMedia 2001 moots broadcaster-MSO promoted regulatory body

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It 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 country.

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:

  • Developing a model for pricing of channels

  • Supervising cable operators‘ operations

  • Fighting piracy

  • Developing a TRP model

  • The 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.

Whither DTH?

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 studios

  • 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.

Get 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 levels.

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.

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