This story first appeared in DNA Money edition on Friday, June 22, 2012.
The deferment of switchover from analog to digital cable signals in the four metros by the Union information and broadcasting ministry has not gone down well with the direct-to-home (DTH) service providers.
Describing it as a major setback to them, the DTH industry players have expressed hopes that the deadline would not be revised further. The ministry has extended the deadline by four months to October 31, citing lack of on the ground preparation by the multi-system operators (MSOs) and local cable operators (LCOs).
RC Venkateish, CEO, Dish TV India, said the deadline extension is not fair on the DTH players. “As a service provider we have made significant investments towards digitisation infrastructure, support staff / manpower, customer service initiatives, etc. And suddenly the goal post has been moved. DTH operators, since the last six years, have been religiously pursuing digitisation and the regulator appears to be only concerned about MSOs / LCOs which, despite having enough time on their side, haven’t prepared themselves for it. I hope the new deadline is made sacrosanct and doesn’t become a rolling date,” he said.
As part of the Phase I cable digitisation exercise, over 12 million television homes in New Delhi, Mumbai, Kolkata and Chennai were to switchover to digital signals by June 30, 2012. And by the end of fourth phase in December 2014, over 90 million analogue cable TV homes were estimated to convert to digital. Industry experts said the digitisation goal will not be met if the deadlines keep getting extended.
Harit Nagpal, president, DTH Operators Association of India, said the DTH community, which is licensed, regulated and pays taxes on behalf of each of its customers, has once again lost out to its analog competitors, which are not subjected to these rules.
“It is difficult to understand what different is being planned in the next 3-4 months that was not in the last six which would not lead to another postponement in October. Moreover, November hosts Diwali and could turn out to be an unwise time since it’s the peak month for broadcasters for advertising revenues and the migrant installer community goes back to their hometowns,” said Nagpal.
With significant capital expenditure already incurred in anticipation of huge demand for their services, DTH operators fear deadline extension is likely to impact business.
Shashi Arora, CEO, Airtel Digital TV, “It will put strain on the financial health of the DTH industry due to additional inventory carrying costs and investments in infrastructure that the industry will have to incur now. While we were fully geared up for the earlier deadline, we will continue to support government’s digitisation agenda as it is in the best interest of our customers and look forward to its successful implementation at the earliest.”
While applauding the ministry’s decision to extend the deadline, the MSO / LCO fraternity said the deferment was inevitable.
Ashok Mansukhani, president - MSO Alliance and whole-time director - Hinduja Ventures, said he was not at all surprised and was entirely expecting the deadline extension. “There was a significant delay in the regulator’s recommendations and tariff order. As a result there was not enough time left for MSOs and LCOs to finish the necessary arrangements and agreements with broadcasters. Now that we have time on our side, the focus will be on getting the Reference Interconnect Offers (carriage fees) and other commercial terms finalised so that a proper business model could be put in place.”
A meeting between the Telecom Regulatory Authority of India (Trai) and MSOs is scheduled to take place on June 25, 2012, to chalk out activities / timelines for meeting the new deadline. The Trai taskforce will be meeting every fortnight to take stock of what is happening and how much ground has been covered by the MSOs / LCOs in the effort towards digitisation.
Another hurdle, industry sources said, was with the issue of new MSO licences that were handed over by the regulator as late as Wednesday. As a result new players were in no position to roll out their services within 10 days, they said.
However, Mansukhani is confident that despite the delay in issue of licences, the new MSOs will work aggressively and put together necessary infrastructure (head-end, STBs and other customers support services) and catch up with the others.
The deferment of switchover from analog to digital cable signals in the four metros by the Union information and broadcasting ministry has not gone down well with the direct-to-home (DTH) service providers.
Describing it as a major setback to them, the DTH industry players have expressed hopes that the deadline would not be revised further. The ministry has extended the deadline by four months to October 31, citing lack of on the ground preparation by the multi-system operators (MSOs) and local cable operators (LCOs).
RC Venkateish, CEO, Dish TV India, said the deadline extension is not fair on the DTH players. “As a service provider we have made significant investments towards digitisation infrastructure, support staff / manpower, customer service initiatives, etc. And suddenly the goal post has been moved. DTH operators, since the last six years, have been religiously pursuing digitisation and the regulator appears to be only concerned about MSOs / LCOs which, despite having enough time on their side, haven’t prepared themselves for it. I hope the new deadline is made sacrosanct and doesn’t become a rolling date,” he said.
As part of the Phase I cable digitisation exercise, over 12 million television homes in New Delhi, Mumbai, Kolkata and Chennai were to switchover to digital signals by June 30, 2012. And by the end of fourth phase in December 2014, over 90 million analogue cable TV homes were estimated to convert to digital. Industry experts said the digitisation goal will not be met if the deadlines keep getting extended.
Harit Nagpal, president, DTH Operators Association of India, said the DTH community, which is licensed, regulated and pays taxes on behalf of each of its customers, has once again lost out to its analog competitors, which are not subjected to these rules.
“It is difficult to understand what different is being planned in the next 3-4 months that was not in the last six which would not lead to another postponement in October. Moreover, November hosts Diwali and could turn out to be an unwise time since it’s the peak month for broadcasters for advertising revenues and the migrant installer community goes back to their hometowns,” said Nagpal.
With significant capital expenditure already incurred in anticipation of huge demand for their services, DTH operators fear deadline extension is likely to impact business.
Shashi Arora, CEO, Airtel Digital TV, “It will put strain on the financial health of the DTH industry due to additional inventory carrying costs and investments in infrastructure that the industry will have to incur now. While we were fully geared up for the earlier deadline, we will continue to support government’s digitisation agenda as it is in the best interest of our customers and look forward to its successful implementation at the earliest.”
While applauding the ministry’s decision to extend the deadline, the MSO / LCO fraternity said the deferment was inevitable.
Ashok Mansukhani, president - MSO Alliance and whole-time director - Hinduja Ventures, said he was not at all surprised and was entirely expecting the deadline extension. “There was a significant delay in the regulator’s recommendations and tariff order. As a result there was not enough time left for MSOs and LCOs to finish the necessary arrangements and agreements with broadcasters. Now that we have time on our side, the focus will be on getting the Reference Interconnect Offers (carriage fees) and other commercial terms finalised so that a proper business model could be put in place.”
A meeting between the Telecom Regulatory Authority of India (Trai) and MSOs is scheduled to take place on June 25, 2012, to chalk out activities / timelines for meeting the new deadline. The Trai taskforce will be meeting every fortnight to take stock of what is happening and how much ground has been covered by the MSOs / LCOs in the effort towards digitisation.
Another hurdle, industry sources said, was with the issue of new MSO licences that were handed over by the regulator as late as Wednesday. As a result new players were in no position to roll out their services within 10 days, they said.
However, Mansukhani is confident that despite the delay in issue of licences, the new MSOs will work aggressively and put together necessary infrastructure (head-end, STBs and other customers support services) and catch up with the others.
No comments:
Post a Comment