the tone in 2005 was set by second bouquets, the fight for
band placements and the emergence of Tdsat as a settler
of disputes, the big story in the coming year will be DTH
for all in the TV business, especially the distribution
folks. SET Discovery President Anuj Gandhi crystal gazes
and spells out how the distribution scenario will shape
up in 2006 and in the coming years.
big story this year was to settle the second bouquet of
channels on cable networks. Every distribution company had
to face this challenge as the industry was loaded with new
channel launches. It may have taken shorter time for some
and longer for others, but the fact is that the bouquets
got carried in most markets.
the three platforms, our task, in a way, was easier because
we had existing channels like Ten Sports, NDTV 24X7, MTV,
Nick, Animax and Sab TV in our second bouquet. Zee-Turner
also had HBO which hopped out of our bouquet, but the other
channels like VH1 and CNBC Awaaz were newly launched. Star
India, perhaps, had a tougher job till Star One got established.
has been growth for all the three distribution companies,
mainly from the second bouquet. Though it took time, all
of us have been able to establish the value proposition
of our second bouquets in various degrees.
were also allowed a seven per cent hike on rates by the
Telecom Regulatory Authority of India (Trai). The cap on
rates, however, limited our ability to garner in more revenues.
second big story of 2005 was carriage fee and the fight
for band placement. Everybody got sucked into it. Cable
networks had the advantage because bandwidth was just not
available on analogue systems to carry so many channels.
Even Zee Sports had to pay for distribution, becoming the
first sports channel to do so. Carriage or placement fee
has grown by five times over the last two years.
third thing to happen was the takeover of Tdsat (Tribunal
Dispute Settlement & Appellate Tribunal) as the arbitrator
of disputes. That is one of the big changes we are witnessing
in the way the business is being done. Earlier the disputes
between broadcasters and cable operators were left to individual
negotiations and settlements.
for 2006, the big expectation is that new delivery platforms
will emerge. Direct-to-home (DTH) and new technologies offering
video services will launch in 2006, though it will take
them 2007 to sink in and establish. The last mile telecom
operators are expected to get into play. We can also have
pure play digital cable TV providers.
thing to look forward to is surely new technologies. It
will offer a lot of opportunities. Unlike analogue, it will
be a transparent and clean business. Besides, there will
be no capacity problem.
is exciting us at One Alliance is that we have two big events
to drive these technologies - Champions Trophy and ICC World
Cup. There can be several value-adds which can be created
around cricket. This will differentiate digital cable and
DTH from the analogue players. While pricing will still
remain a criteria, differentiators have to be created to
build different market segments.
challenge for these emerging platforms, however, is to drive
numbers. We will have to see how we can maximize our revenues
from these technologies.
could not get content from major broadcasters this year.
We were in talks but couldn't reach a conclusive agreement
with Dish TV. The content challenge in 2006 will be to strike
deals and be available on all the platforms.
time was spent on establishing the second bouquet in 2005,
the trend next year will be to hold on to the band positions
on cable networks. Bouquets are more or less complete. There
is no point now in adding more channels. We won't see that
story in 2006.
from the consumer's angle, there is no real requirement.
In fact, last December viewers had a good mix of 30 channels
in their prime band. Today, it is not the same thing. Placement
fees have decided which channels to load in which band.
In Delhi, for instance, there are too many news channels
in the prime band list.
you look at it, most of the channel launches in 2005 were
in the news genre. Even in the kids' space, the last to
come was the Walt Disney channels in 2004. And it is news
channels that have initiated and are the prime drivers for
carriage and placement.
in fact, are investing in distribution. There is no point
splurging on marketing without ensuring carriage on cable
networks. Broadcasters have realized this even when they
are launching channels.
bouquets have the power to push weaker channels on the back
of stronger ones. For a standalone pay channel, there is
no hope; you will need crutches in today's situation.
won't digital cable take off? There is resistance from last
mile operators who have, after all, not faced competition
for over a decade. But once DTH happens, it will change
so many things. Last mile operators will not want to let
their business go away to DTH. The market will drive digital
cable. And value-added services will start happening next
including DTH, cable and IPTV will take market share of
analogue. Estimates are that by 2010 there will be 10 million
about carriage fees? These will stay. In some smaller markets
where there are no multi system operators, low-cost digital
headends will come up. As the signal will not be encrypted,
addressability won't be possible. Consumers can't select
and pay for the channels they want to buy. We expect carriage
and band placement to reduce in these places, but not in
the short term.
will be the challenge in 2006 on the revenue front? We will
have to maintain what we get from analogue cable and try
to squeeze in some growth. Already, the 4 per cent hike
on rates allowed by Trai in 2006 is being disputed in courts.
We will have to live with whatever the outcome is. And we
will also have to live with the fact that we will have to
share our premium cricket content with Doordarshan.
opportunity is also in exploiting new revenue streams from
the delivery platforms that will come up in 2006.
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