Well, in a way, all of us in the industry can say "High Time"! And we, at UTV, would know...

Flashback to the past

UTV promoters were responsible for launching the very first cable TV connection in India on 19 June 1981. That was at a time when the consumer paid for receiving just ONE terrestrial channel plus one video channel and that to for three hours a day 8 pm to 11 pm. The charge was Rs 200 ......this was nearly 22 years back and in the first year of operations, we had 150,000 subscribers paying that amount.

So let us examine what has happened since then? The 150,000 connections has grown close to 35 million house holds and the channels have grown from one to 100 plus with many more 24 hour video (cable) channels thrown in.

And, like all other consumer services "market forces " now decide the tariff, depending on geography, critical mass from a control room and socio economic profiles of SEC A to SEC E.

But, one thing that was very different happened! Different from almost anywhere in the world; and that is no sense of legislation or regulation entered this industry for these 22 years. Licencising that would have enabled cable operators to get territories for a fee; which would have given them exclusivity; and with that the 'required' clarity of long term in order to enable them to make the right investments; or garner the right investors. If all these issues had been taken care of, the indigenous cable industry would have grown.

This single act, or non action, is the reason why we are at the cross roads today. Since cable operators did not have territories, they were forced to charge just what would allow them to operate in that area, and thereby started the "squeeze"!

The "squeeze" between what the cable operator would charge the consumer (without the cooperative society throwing him out) and the slow but increasing demand from the broadcasters (who were introducing a pay model wherein none had originated in any structured form) resulted in a situation devoid of any structure.

So let's jump to the present

Essentially, the conditional access system (CAS) is set to realign these anomalies, where....
a)the consumer: would get a choice of what he wants to see and not; and with that choice he will have to pay the correct amount; something he was not doing all this time ..for the "Full Monty" he was getting till now.

b)the cable operator: if he plays this correctly, will live more peacefully and not being "squeezed", which may suit most but not all.

c) the broadcaster: will finally get his due. The broadcaster will know who actually wants to pay for his fare, as in the past he was dissatisfied with the just 20 per cent reporting, but that was 20 per cent of the entire cable universe. And now, while the broadcaster may inch closer to 100 per cent disclosure, it will be only from the base of the people who want his fare.

The one thing, I believe everyone is still missing, and this is at the regulatory level, is the absence of licensing of territories. This is still a problem - we still have cable wires laid strung over buildings; or dug underground without permissions; and also the cable operator will still be accountable to the building societies for the services.

So this is one part of the missing puzzle that still needs to be plugged; and if it is not, we will still have some alignments to do later.

So now, all we have to do, is solve the short term challenges
a) who will pay for the box;

b) availability of the boxes has to match pace of roll out of CAS so that there is no black out or suspension. Such jolts, even if they last three months, will have long reaching impact for a year and more;

c) the consumer "mindset" that makes them acclimatise to the fact that ...for what they are paying now ,,,, they will get "X" and all after that is additional;

I think a) and c) are problems that will take time and therefore how this rolls out is of even greater importance.

Lastly from the content creators' point of view
I can only think of the positives, mid and long term. We are not in the value chain that can make any difference in how the consumer will react, or the roll out plan.

We are very vocal in saying that the pace of roll out cannot be forced; and has to follow a plan matched with availability of boxes and a cost rationalisation, that ensures no interruption of services.

Now, that the consumer has to adapt to this new change will take it's own time. And yes, here market forces will decide, but we cannot force a pace of change.

Also, in many cases, market forces and the made "change" will evolve; BUT we must not forget that unlike most other consumer services, this one is DIFFERENT , whether we like to admit it or not.

The nuclear family spends close to three hours a day, watching TV - for entertainment, for news and much more. And it's not a minority of the population that we are affecting like in the case of say of say the Internet, or telephony, or even the Mobile revolution. We are talking about close to 50 per cent of the country's educated population. So what we have not done for 22 years cannot be done in just six months.

Of course, it's the best thing for all; and needs to be done and done today and on 14 July, but with all the factors in place.

As content providers, the post CAS era will throw up new opportunities as...
a) niche channels will be able to operate thereby enlarging the requirement for local programming.

b)since the consumer will now choose the channels he wants...there will be a greater demand for better programming; the top shows will carry a lot more weightage; and there will be a greater need for what we call "tentpole" programming....(looking for those great hits of one or two programmes on the channel that ensure that the consumer wants that bouquet of channels just for those two programme).

c) multiple genres will become successful and broaden the base of shows for viewers to watch

On the issue of broadcasters slashing remuneration for production houses:

It would be a misnomer to assume that broadcasters were paying or are paying"high fees" for their programming. This actually implies that they were over paying - which obviously is far from the truth.

Depending on how the the CAS roll out unfolds, I think everyone knows the mid and long term gains of the post CAS era. There might be some short term pain or cost for this long term gains.

The costs at which programmes are being produced are very realistic. All of us can see the production values as well as the spend on the screen - in fact, almost everyone will be unanimous in saying that programmes on TV have leaped frogged in terms of quality and execution in the last three years.

Any special strategy/budget to meet post CAS developments

We are watching the developments and are talking to our customers and our affiliates too. Everyone is aware of the short term challenges that CAS could throw up if it is not rolled out in a pragmatic manner. But, the fact remains that everyone is in favour of CAS and its implementation.

On whether CAS affect the production values and quality of the serials/soaps on air in anyway

Broadcasters in a post CAS era will be more and more conscious that only great programming will get customers to ask and pay for their bouquet. There will lead to a pronounced need for "tentpole" programming - where there will be more of a pursuit for those two or five programmes that will set the channel apart; or where consumers are willing to pay for that "particular" channel. Just so that they can continue to watch just these few programmes.
There will be only a greater demand for better programming post CAS.

On whether production houses might re-negotiate rates with stars (actors and actresses) in the post-CAS scenario

It will all be on "reactive" mode for which it is too early to tell.

On whether production houses will indulge in cost-cutting

Serials are totally economically viable as they stand now.
Just because there is going to be some pressure on revenues on advertising for short term does not mean that the economics of producing winning content has to be relooked at or revisited. It's a complete fallacy and again just wrongly slanted, without understanding the true dynamics

Manish Popat, COO TV content, UTV Software Communications Ltd.

(The views expressed here are those of the author. www.indiantelevision.com need not necessarily subscribe to them).