[icernet] Booming Indian cable TV industry has fight on its hands with viewers

[Arul Selvan]

  Millions of Indian television viewers used to enjoying dozens of 
channels for free have been jolted by a government move to make them pay 
for watching the most popular channels. Such has been the disgruntlement 
caused by the upcoming Conditional Access System (CAS) that it is even 
threatening to blow into an election issue with opposition political 
leaders berating the new set-up.

The government has said consumers in four cities - New Delhi, Bombay, 
Calcutta and Madras - will have to install set-top boxes on all 
television sets by July 14 to view a large number of cable and satellite 
channels. This will mean they will have to fork out around 2,000 rupees 
(US$40) for a set-top box in addition to paying extra money for watching 
the most popular channels, which will all charge their viewers. India 
had perhaps the lowest charges for television viewers in the world as 
they could view between 30 to 100 channels for paying cable operators 
monthly sums of around 250 rupees (US$5.3).

Anand V. Patwardhan, chairman of the Consumer Guidance Society of India, 
said the 6.4 million cable consumers in the four cities will find their 
combined monthly charge of one billion rupee (US$20 million) shooting 
up.``The consumers will now be required to pay 35 billion rupees by July 
14, 2003, if they wish to receive the same channels they are receiving 
today, in addition to the monthly subscription,'' he said. ``Since all 
these set-top boxes are required to be imported, can the nation afford 
such extravagence?'' he added.

Political opposition has been equally strong and Delhi Chief Minister 
Sheila Dixit, who belongs to the main opposition Congress party, wrote a 
letter to the government that the move would burden poor and 
middle-class consumers. The government sought to appease irate consumers 
by slashing the import duty on television set-top boxes from 50 percent 
to around five percent bringing the price down to about 2,000 rupees 
(US$40). The government says the new ``Conditional Access System'' will 
enable viewers to pay only for the channels they want to watch.

But consumers say this was trying to pull wool over their eyes as they 
will have to shell extra money for all the channels which they get 
free-to-air paying only small monthly charges. ``I would like to know 
what has changed that those television channels which were happy to show 
their programmes with only advertisement support now want to charge 
extra money from viewers,'' said Raghuvansh Prasad, a resident of New 
Delhi. On the other hand, television industry officials say the regime 
will bring greater transparency as advertisers will clearly know the 
viewership of individual channels and give the freedom of choice to 
consumers.

Jawahar Goyal, head of Zee Network's distribution, told AFP that many of 
the television channels would fall by the wayside as they would not be 
able to support their viewership claims with advertisers in the new 
regime. He said it would help the cable television operators as they 
were having to shell out large sums of money to broadcasters although 
their programmes were free-to-air for consumers. ``The Conditional 
Access System regime is the right thing, otherwise the whole cable 
industry will dwindle,'' said K.D. Khanna, president of the Cable 
Networks Association. ``Who is saying that the consumer can not afford 
to pay? Today even an average middle-class household has at least two 
television sets, if not three to four,'' he added.

An explosion in cable television channels has taken place in India in 
the last 10 to 15 years under an economic reforms programme and the 
popularity of television sets with cable and satellite connections has 
soared. Nearly half of the 80 million televison sets have such 
connections - more than India's total telephone connections. Foreign and 
Indian private television channels such as Sony, Star and Zee have 
virtually crowded out the staid state-run Doordarshan which used to 
dominate India's airwaves.

Source:
AFP
June 4, 2003