Surajeet Dasgupta, living in the Chittaranjan Park area of South Delhi, is not unduly perturbed that at the stroke of midnight (or so the cable operators were telling us earlier) there is a chance that his house would stop receiving the pay channels (his family‘s most fav channels: Cartoon Network, HBO, ESPN, Star Sports and Star Plus).He also hasn‘t yet bought or rented a set-top box that would be necessary to access the pay channels with the cable industry here deciding to implement conditional access system (CAS) in the south zone of the metro.
Says Dasgupta, "I‘ll wait and see whether the industry is serious about CAS this time. Moreover, my cable operator has promised me that I‘d continue to watch the ongoing India-Australia cricket Test on Star Sports on Monday as he doesn‘t have a box to give me. Reason being the boxes haven‘t reached him yet."
"The cablewallah said he doesn‘t have a box to sell us, which anyway looks like a costly proposition, and that till January we can continue watching all the channels, as we have done in the past, for Rs 100 a month," says Ms Dubey, a housewife residing in another part of South Delhi‘s Vasant Vihar, hoping that CAS would again get deferred or else the Dubey family would have to do with just the free to air channels.
That, in a nutshell, is the first brush with addressability for the 400,000-450,000 cable subscribers of Delhi‘s south zone. The consumers are playing the wait and watch game, while the LCO is attempting to assure the subscribers that there won‘t be a total blackout as had been threatened earlier. But, it would be nice if they go in for a box.
However, this is also indicative of another fact: despite the brave front being put up by the cable industry, especially the multi-system operators (MSOs) are not ready to rollout CAS at such short notice. Evident in the LCOs telling consumers in most parts of south Delhi that the boxes are yet to reach them or would be dispatched later as other things, like agreements with broadcasters, are yet to be inked and delivered.
For this confusion amongst the industry players, Zee Telefilms vice-chairman and head of Siti Cable (servicing over 20 per cent of the C&S homes in South Delhi), Jawahar Goel, offers an explanation: "You see the cable operator has already paid the broadcasters the subscription money for December. So, how the cable industry uses the remaining 15 days of the month by blacking out pay channels totally or letting the consumer slowly realise the situation is up to the cable industry."
Pointing out that, more importantly, a beginning has been made, Goel adds, "There would be instances where some LCOs would say boxes have not reached them as even within a limited area the logistics need some time to be worked out."
THE VITAL STATS
Every industry move, whether government induced or not, involves numbers that form the backbone of a business strategy.
In the case of cable TV, this is the most difficult part. An NRS or an IRS may have put a number to the total number of cable and satellite (C&S) homes in India at approximately 40 million, but beyond that the numbers are very difficult to get and, if some are bandied around, they are equally tough to ascertain.
No wonder, a consolidated figure for the number of C&S homes in South Delhi ranges from 250,000 to 700,000, depending on which MSO is asked for the number. Hathway Datacom and INCableNet would put the South Delhi C&S homes at not above 350,000, while Siti Cable‘s Goel feels that it would be anywhere between 500,000-600,000.
A senior Hathway executive, while trying to explain the C&S homes being on the lower side, says, "The South Delhi area may look big, but, unlike North or West Delhi, is not densely populated."
However, a figure that has been submitted to the government during various interactions in the run-up to the CAS implementation, puts the total number of C&S homes in South Delhi at between 400,000-450,000.
According to data obtained by indiantelevision.com from an MSO, there would be approximately 70,000 homes serviced by Siti Cable in South Delhi, approximately 40,000 by Trinity Networks that was formerly known as Spectranet (revealed by Trinity‘s Arun Mohan), over 80,000 by Hathway Datacom, about 20,000 by INCableNet and 35,000-odd by independent cable operators like Home Cable‘s Vikki Choudhry.
Why this huge range for the number of C&S homes in South Delhi? A senior Star India executive, involved in distribution, comes up with an explanation that sounds logical.
"The number varies because the attempt is to put it on a lower side as that‘s the number for which MSOs pay us the subscription money. Low subscription money is justified by projecting a lower number of C&S homes," the Star executive explains.
Interestingly, Star executives point out, there are about 800,000 legal electricity connection in South Delhi. Even if it is assumed that out of these connections, 30 per cent don‘t subscribe to cable TV, then also the number is much more than 400,000.
THE BOX, DEMAND AND PREPAREDNESS
The demand for the set-top box, at the moment, is near zilch. Fresh demand over the last one week has not come and the South Delhi market has only those boxes that had been seeded (outright sales, plus complementary) before Delhi got denotified from the CAS map.
Admits Home Cable‘s Choudhry, "I have some 800 (analog) boxes with me and none of them have moved in recent times." Points out HTMT‘s Seshasayee, "There won‘t be a huge demand from Monday onwards. The consumer would wait to see the turn of events and whether the cable ops are serious about routing pay channels through boxes from Sunday midnight that would mean blackout of pay channels for non-box homes."
According to the data provided by the industry, which needs to be taken with a pinch of salt, Hathway has about 1,200 boxes (outright sales) in South Delhi, while Siti cable claims to have seeded 2,000-odd boxes. The figures for INCableNet have not been disclosed, while Home Cable has moved 700-odd boxes. But all these were supposed to have gone out before the assembly elections.
Where preparedness is concerned, most MSOs do seem to be adequately prepared. A quick round of various headends of the leading MSOs by indiantelevision.com showed that the likes of Siti Cable are prepared for CAS, some last minute things notwithstanding.
While the MSOs would be rolling out digital CAS, some independents like Home Cable would rely on analog. Trinity, having the least number of headends amongst the MSOs, is starting off with analog boxes, but "would switch to digital in about three months time," says Arun Mohan.
Because the lot of backend work has been completed, the availability of boxes does not look like a problem. INCableNet claims that it about 90,000 boxes (conditional access by NagraVision) are in its godowns to be moved to the cable ops. Close to a similar number is also with Siti Cable and Hathway says it has "enough to cater to South Delhi‘s demand." Trinity‘s Mohan says the company has 6,000 boxes from Canada‘s Trivision already in, while another 10,000 are in the process of being brought into the country.
But, director of business development and chief technical officer of Hinduja TMT, K V Seshasayee feels that the cable industry has to be in top form to meet the demand when it starts coming in thick and fast at a later stage. "We do have to perform well because I don‘t feel the MSOs can meet the demand for more than 1,000 boxes a day."
THE MARKETING OF CAS
What do you do when the subscriber or the consumer is not willing or reluctant to shell out additional money for the boxes and the monthly rent? You throw in sops for a box buyer like Siti Cable and INCableNet are planning to do.
While Siti Cable is likely to add about five cable-delivered channels for its CAS-enabled consumers by bring in some fare from ASC Enterprise/Zee‘s DTH bouquet, INCableNet is close to signing up with at least four American and European entertainment channels for its CAS consumers.
"We have to give something extra to the consumer who switches over to the box. That‘s why we are planning to throw in a digital movie channel and also ones like Zee Classic and Premier Movies," Goel says.
INCableNet has gone a step beyond the introduction of new channels for marketing purpose. It has also tied up with MTV and Shop 24 for gifts and discount coupons for its CAS-enabled consumers.
A more conservative Siti Cable is relying on crawlers on CAS on its various video channels in South Delhi and is in the process of distributing pamphlets in the cable homes as part of an `education‘ process.
Using the video channel for communicating CAS-related information and the service is the most common practice employed by all, including Hathway, Home Cable and independent operators.
Points out Goel, "With the media giving enough publicity about CAS, why should we spend more from our pocket than what is necessary at a basic level?"
The demand for boxes would start coming in by middle of January, the industry feels, when it is also likely to get ramped up.
Still, the industry expects that in the first month of introduction of CAS, depending on the fare and that MSOs sign up with broadcasters, between 10-15 per cent C&S households would become CAS enabled.
According to a senior executive of Hathway, "We expect that within three months 40 per cent of the South Delhi C&S homes would have been made CAS-enabled and the figure would reach 60 per cent in six months time, which is the maximum ceiling that we are looking at."
The MSOs have returned with minor changes on their various offers for the boxes. Depending on the service provider an outright purchase of a box from Siti Cable cost the consumer Rs 2,990, A Hathway box would cost Rs 3,025 and an INCableNet box would cost Rs 3050. Add to that sales tax of eight per cent, the smart card price (refundable) of Rs 400 and an activation charge of Rs 250. The last two figures are common for all the three.
On rent, a Siti cable box would cost about Rs 2,500 (refundable), plus a monthly rental fee of Rs 18 and the cost of the smart card and the activation charge.
Hathway/Win has two rental schemes. The early bird scheme is a refundable deposit of Rs 999 with the monthly rental of Rs 40, while the regular rental scheme envisages a refundable deposit of Rs 2,600 with a monthly fee of Rs 28.
INCableNet has come out with an scheme of Rs. 999 as the refundable deposit with Rs. 50 monthly rental fee.
THE GREY AREAS
Apart from the availability of boxes (or the lack of them), an important factor in the success of CAS would be the agreements that broadcasters and MSOs have to conclude.
"Whether CAS can be effectively rolled out from 15 December in South Delhi would depend a lot on whether the broadcasters and the cable industry conclude the agreements soon or not," a senior government official, monitoring this introduction process, today said.
Yes, the agreements remain a grey area. Because till the time of writing this report, final shapes had been given to various contracts and details between broadcasters and MSOs, but the final inking was yet to happen.
"The deals have been agreed upon and over the next few days should be formalised," Goel says, pointing out that had the broadcasters come prepared with offers, some deals would have already been swung.
Still, Hathway‘s early bird scheme for a prospective CAS consumer has been worked out to Rs 149 for all the Star, ESS and Sony channels, Ten Sports, Hallmark and Nickalodeon. Says Hathway‘s president (operation) for North India, SN Sharma, "We would be giving a hefty discount on the Value Package for a limited period that we‘ll decide depending on the response from consumers."
Later, if a consumer takes the Star bouquet from Hathway, it‘d cost Rs 55.50, while the Sony bouquet would cost Rs 55 and ESS Rs 32.
Interestingly, Zee Turner is yet to discuss and finalise things with Hathway.
But agreeing on the cost has not been easy as Seshasayee says, "With CAS becoming an inevitability, the cable industry would hold tough negotiations with the broadcasters."
So tough were the negotiations that though Star has agreed upon a bouquet price of Rs 111 for Siti Cable (including The History Channel) in a deal that is yet to be signed, during negotiations Star‘s distribution head was not even ready to share the company‘s various permutations and combinations with Siti Cable representatives.
But the issue of increase in subscriber base, a pre-condition applied by Star India, can yet thrown up hitches.
So, will CAS finally become a reality in South Delhi? From Monday in most parts, a status quo may prevail for a few days. Going by the mood all round, including the silence from the government‘s side, it looks like addressability would get rolled out in South Delhi over a period of time that would definitely see some hitches, glitches and misses. Unless, of course, the CAS tale takes another twist.