Saturday, 21 July 2012

The Great Betrayal

The present amendment to the Cable TV Act and subsequent regulations drafted to satisfy the hidden agenda in the DAS Law has lead to the present stalemate in implementing Digitalisation in the country. This will be one of the major factor for its failure as these regulations have been drafted with lot of assumptions grossly neglecting the ground realities. 
Recent extension of deadline for the first phase of digitalization pertaining to the four metros coming just 10 days before the deadline of 01 July itself is an indication that something has drastically gone wrong; Perhaps, people at the helms of affairs did not do their home work properly and took the ground realities seriously. Achieving just 25% of STB penetration instead of 100% expected by 30 June is a shame for the planners who have, for some reasons played with the hopes of the industry. This means that the deadlines and the inputs for the process were not commensurate with the realities. 

For whose benefit are we carrying out this massive exercise; People, cable operators, broadcasters or the DTH players? What I know about the industry is that is the cable TV networks being digitalized for the benefit of the consumers as well as creating a 100 million household infrastructure network to deliver broadband so that the country’s economy gets a boost. However, aim of TRAI and the Ministry appears to be to ensure maximum revenue to the pay broadcasters making each and every TV channel reach the subscribers irrespective of the fact whether consumers can afford the service or not. A fallout of this exercise is that it must be done at any cost even if thousands of independent entrepreneurs are made to lose their livelihood. 

Public Interest Overlooked 
People who drafted the law have totally sidestepped public as well as national interest and aimed to only help a few stake holders. 
There are 100 million analog households. At least 40% of them will be in the category of poor. We cannot assume all of them will afford to take up digital cable service buying an STB. Government has not prepared well to cater to these subscribers. 
Only 10-20% of the Cable TV subscribers may opt to have a digital quality audio and video because they can afford it. This can easily be judged from the number of LCD/LED panels sold in the country. Majority of the people may not have any knowledge of what is digital and how to differentiate a good quality picture from a reasonably ok one. For many consumers, DTH which is totally digital is horrible with its pixilated picture and blackouts during rains and cloudy days or when the dish moves a little on the side. 
It has been proved that no one needs 500 TV channels. TRAI's logic of about 500 channels existing for each state and hence all 500 must reach even in the smallest of area is highly misplaced and with not so clean intentions. Here, I feel it is being bought at par with DTH because all DTH channels reach direct to consumers all over the country. Why do we need to do this when the option to go on DTH is available to consumers in every part of the country? People who can afford an STB, HDTV Sets and high end pay channel services will definitely opt for DTH? Let cable remain an entertainment of the masses. How will the government ensure that each and every existing consumer can get the cable service? 
Definitely, a consumer would like to have the TV entertainment because it puts him on a path of progress, giving him dreams. It doesn't matter if it is analog or digital. Since Cable TV operation is a private industry, least the government can do is to encourage migration to digital broadband network giving adequate incentives. 
Forcing a technology on masses giving no option of a cheaper technology is to deprive millions of consumers their daily entertainment available to them for the last 25 years. We know our government is not capable of fulfilling even the basic needs of all the people, how can we expect it to subsidise STBs for digital cable? But definitely it can enough incentives to Digital cable so that every operator would like to go for it. Also there is no compelling public demand for the digital service yet. 
No spectrum is saved by passing digital signals in a cable network. Government can benefit only by digitalising the terrestrial transmissions of Doordarshan that will also allow them to provide more channels in the free- to- air Doordarshan services. Yes, that is something of public interest but I&B Ministry is not focusing on this. Ministry can even make lot of money by selling the terrestrial TV slots to private broadcasters and make tons of money like it is done in the telecom sector. 

Government's Role 
Government's Role, in particular that of the I&B Ministry and TRAI has been very dubious in the whole process. No Doubt digitalisation is very important and need of the time. All developed nations are going in for digital broadcasting. But that is restricted to only government's public service broadcasting or terrestrial broadcasting where we save on the critical resource of spectrum that can be utilised for many other public services. 

Digital switchover 
Prasar Bharati had started planning to digitalise its services in 2006. In fact Delhi was to be totally digitalised by 2010 Commonwealth Games and rest of the nation by 2012. One really needs to question the Ministry about what happened to all these plans and how much exchequer’s money has already been spent on these plans without any visible results in the last six years. 

Digitalisation of Cable TV was never a National Priority 
First of all Cable TV is a private service sector where government has all the right to levy taxes, lay down standards to levy taxes, standards of service but has no right to dictate how to run this business. It should assist the service providers in giving best of the services, enabling them with Right of Way, subsidy on equipment, tax rebates and easy investments etc. However none of this has happened. Even the tax rebates and duty exemption proposals have been rejected by the Finance Ministry, indicating that mandatory digitalisation of the Cable TV sector is not such a priority where government can afford to spend so much of public funds. 
As far as additional tax revenue is concerned, it is again an assumed benefit of digitalization. Firstly, there is no sure count of pay TV subscribers in India. We are relying on TAM figures that represent the data of only a few cities. Secondly, if we make the services out of the reach of millions, government loses the revenue of service tax and entertainment tax. Even pay TV broadcasters tend to lose drastically in their viewership as in a-la-carte mode or even in bouquets, many may not afford all the popular or regional channels. 

Broadband is a National Priority- But overlooked 
Greater priority tasks are waiting to be tackled by the Government like providing food, water, power, education and health of the people than forcing a private industry to adopt a technology. There was indeed an opportunity for the government to exploit the Cable networks by integrating them with the National Fiber Optic Network for which PM has allocated 20000 crores. 
By using the last mile of Cable Networks government can reach more than 25000 vllage panchayats in a much shorter time and spending much less. Government can take over the rural cable TV networks under its fold and develop the infrastructure further using the well trained manpower of the Cable TV networks in the rural areas that connect more than 35 million homes or about 200 million people. 
But all this is not in the responsibility of the I&B Ministry, so who else will do that?. The newly formed Bharat Broadband Network Ltd can be entrusted with this task. This will give a real meaning to the Digitalisation process rather than spending resources to ensuring more and more TV channels reach the consumers. 
Broadcasters must understand All satellite broadcasting is in digital form. Why then the broadcasters are so much concerned about digitalisation of cable networks. Broadcasters are ruing the four months' extension of the Phase - I deadline saying that they had spent so much of money and effort in promoting and communicating the date and making sure consumers went along. 
But the fact is that Public is more confused than before. Messages on TV channels ask them to approach their Cable Operator or DTH operator. When Cable TV is being digitised, why should a subscriber approach a DTH company? Moreover, DTH service provides the same content as a cable network. Many advertisements of DTH companies are touting the consumers not to go for Cable TV box because they have a superior box. If the government is serious about digitalization of cable TV, why should it allow such predatory ads of competing technology? That means even before a subscriber asks his cable operator to install an STB, he is confused whether to go for the Cable TV box or a DTH box. And since he knows that DTH is a costly service (otherwise he would have already gone for it), he will prefer to wait till the end. 
If broadcasters were really serious about digitalisation; they would have carried elaborate discussions on the subject with the consumers like they did during the Lokpal Bill movement to make people aware of the goodness of the service. I don’t see a single such programme. Mere ticker or message in English does not make any impact on the consumers. And the government should guard the cable industry against any unfair competition from DTH or any other digital service and open the competition only at the end of the switchover phase when there is a level playing field for all of them.


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