9 December 2000

CABLE TV MAY BECOME TOO COSTLY FOR COMMON MAN

From Rakesh Sharma

NEW DELHI: Pressured by the upcoming nationwide cable operators, the Central Government is actively considering a proposal which may make cable TV too costly for the common man. The proposal, mooted by these cable operators, aims to make it legally binding for cable viewers to install costly monitoring systems in their homes for watching the growing number of pay channels, according to sources in the cable TV industry.

The other serious implication of this move is that it will put out of business small cable operators, who because of their small subscriber base, will find installation of new equipment for serving the new  machines to be installed in viewers' home economically unviable  due to the high cost of installation and operation.

If the Government accepts the proposal, it will bring forward a legislation which will make it mandatory for all consumers wishing to view pay channels to install a piece of equipment known as Conditional Access System (CAS).  Once this costly equipment is installed, it will become possible for the cable operators to control the delivery of channels to the consumers.

The only apparent benefit for the consumer will be that they can decide which pay channel to view and for how many days or weeks and so they need not pay for all the channels they do not view.

In the United States, hundreds of cable TV channels are available but all good channels are paid channels and that is why the American homes have to make a choice as to which channels they view or do not view. The same will happen in India if the Government accepts the CAS proposal.

According to small-time a cable operators, the CAS proposal had apparently been made in the backdrop of an  Andhra Pradesh case in which the court had upheld a consumer's plea that he should not be forced to pay by his cable operator for the pay channels he had not viewed or did not wish to view.

The cable operator said though CAS was common currency in various developed countries, including the USA, it had yet to make its presence felt in India.  Technically-speaking CAS involved two-way communication between the cable operator and the consumer, unlike the present one-way system in which signals travel only from the cable operator to the consumers. This means that the cable operators will have to completely overhaul their system, including their cable network, to provide for two-way communication. Also they will have to install costly computers and other machines to implement the CAS.

Though the consumers will find CAS very friendly to use because they then need pay only for the duration they subscribe to a particular channel, it might well see the friendly neighbourhood cable operator lose his autonomy to the new "big daddies" of convergence technologies. Reportedly at least two big companies are currently laying fiber-optic cable network all over New Delhi. The really small cable operators could go completely out of business. The reason - a CAS-based cable operation needs to have a subscriber base of around 50,000 to be economically viable, according to the Delhi-based cable operator.

The small cable operators see a big design in the move by nationwide cable operators who want to use the new convergence technology to provide not only satellite channels but also content on demand, internet and direct marketing of a wide range of products through their network. Since all this is obviously beyond the reach of  the neighborhood cable operator, he along with his cheap cable service, are like to soon pass into history.

According to sources, the big cable service providers are expecting to start their operations in a big way within a few months as they feel that the economy of the country will improve around February and people will have enough spare money again start buying consumer durable goods. As such they are pressuring the government to clear the CAS proposal as early as possible.

Along side they are using their business clout and money power to make the small cable operators fall in line. They are offering very small sums of money to virtually take over the businesses of small operators many of whom fearing imminent death of their small business are preferring to sell off their business rather than go for a franchise arrangement which might severely constraint their business autonomy. But whether the small operators manage to survive or not, the consumer will find himself being held to ransom by the big operators who are like to be favoured in various ways by the new law. Significantly, the installation of CAS will also provide the Government greater power to control and regulate the content being delivered their cable TV, thus curbing further the freedom of TV viewers, the sources added. END