Broadbandindia Magazine

The Government of India has shown some progress with its much-awaited plans for cable TV digitization. The recently passed ordinance that amends the Cable Television Networks (Regulation) Act, approving the timeline the Ministry of Information and Broadcasting (MIB) and suggesting for mandatory digitization has been converted into a law recently. According to the ordinance, analogue signals will be completely switched off by December 31, 2014.  It seeks to introduce addressability in the cable TV network, wherein all TV channels will be provided to houses through set-top boxes (STBs).

Digitization is a once-in-a lifetime opportunity for MSOs to realize their vision of directly engaging with end customers. Though the ordinance has put forward a humungous task ahead for the MSOs, the process of transformation will have to be viewed strategically to position an MSO for long-term sustainability. MSOs will need to alter their perception from a largely business-to business (B2B) focus dealing with a few thousand local cable operators (LCOs), to largely a business-to-customer (B2C) focus, dealing directly with millions of customers.

An MSO will have to redefine the potential role of LCOs in a digitized world. However, a key question will be of how willing LCOs would be to relinquish their stronghold over end customers and what measures are agreed upon between MSO and LCO to protect LCOs existing income. MSOs will need to partner with LCOs for roll out of STBs, education of consumers and servicing customers. LCOs will also play a role in collections and increasingly ARPUs. MSOs can use digitization as an opportunity to enter new markets, but first, they must protect existing markets from competition. Digitization can also be used as an opportunity to move to a complete prepaid model (like DTH) and reduce collection hassles. A number of critical decisions on business strategy and operations lie in store for MSOs and LCOs to capitalize on the digitization growth curve.

Ramesh Jalan
Publisher
E-mail: rameshkumarjalan@rediffmail.com
rkjalan@broadbandindiamagazine.com