India under-performing in Pay-TV area, says a report

March 17th, 2008 - 8:19 pm ICT by admin  

New Delhi, March 17 (IANS The economic and social climate in India is highly conducive for pay-TV industry to flourish, but the sector is under-performing and is bogged down by outmoded regulation, an industry report has said. The advantage of India’s rapid cable TV growth is at risk of being eroded by overly intrusive regulations, said a report of Cable and Satellite Broadcasting Association of Asia (Casbaa), an industry-based advocacy group dedicated to the promotion of multi-channel TV via cable.

The case in point is Conditional Access System (CAS), which was made mandatory from Jan 1, 2007, but saw lukewarm response. Compared with other major markets, the digital-TV adoption rate of about six percent of television households remains modest, affecting piracy rates and content availability.

“The industry in India is looking for the ‘light-touch’ regulation appropriate for the creation of world-class digital infrastructure as well as broadband take-up,” said Simon Twiston Davies, chief executive officer of Casbaa, Monday at a press conference.

John Medeiros, deputy chief executive officer Casbaa, added: “What is needed is upgrading of cable network, huge investment, about $15 billion (Rs.600 billion), supportive even-handed regulation is essential. A light touch regulatory system, closer to the Asian norms, would bring huge digital dividends.”

The introduction of a freeze on rates and ceilings for the channel pricing is stifling the industry’s potential, as is the lack of consistent framework for the various modes of Pay-TV delivery and the government’s sweeping “must-provide” rules.

The current policies are forcing content-providers to cater for mass audiences, at the expense of potentially dynamic niche markets.

“Differentiation between types of content and consumers is particularly important,” said Medeiros.

Another obstacle pointed out in the report is the draconian limits on both pricing and packaging for video services which are affecting the entire industry value-chain with an adverse impact on investment in digital infrastructure and content availability, as well as on economic growth generally.

In last 15 years, Cable TV networks have connected 70 percent of Indian homes with wiring and it will continue to grow. They are expected to connect 100 million homes by 2012. However, the Pay-TV’s growth in India and in other Asian countries is largely dependent on digitisation.

Digital TV and broadband networks are set to play a vital role in India’s economic development just as they did in Japan, Europe and the US. Especially, with 1.1 billion people, a median age of around 25, and literacy rate of 61 percent, India’s population is increasingly educated and technology savvy.

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