Indian broadcasting is in for a major transformation in light of the global
phenomenon of convergence of telecommunication, computing and audio/video
broadcasting. This convergence has been possible due to technological
developments in the field of digital signal processing, compression techniques,
switching, etc. We are passing through a phase of transition from the
predominant analogue to digital transmission both in audio and video space. The
way information, communication and entertainment services will be delivered
through the audio-visual media in India in the coming years is going to make a
departure from the present, which is predominantly one way, to the point of
There has been an explosion in the number of channels, which hovers at over
sixty now. This is likely to go up, as more and more players enter into the
field. More specialized channels are coming up, catering to specific segments.
The concept of pay-TV has started taking root, meaning more revenue for
broadcasters. We are already witnessing the use of telecom networks for video
transmission and the availability of the Internet on the television, though on a
very limited scale. But that is a good augury.
The Burgeoning Indian
|The Big Brothers: DD and AIR|
All India Radio:
It has come a long way from six stations and a complement of eighteen transmitters in 1947, to owning a network of 198 broadcasting centers, with 145 medium frequency, 55 high frequency (SW) and 103 FM transmitters. The coverage is over a ninety percent area, serving 97.3 percent of people in the largest democracy of the world. AIR covers 24 languages and 146 dialects in home service and in external services, it covers 24 languages
The one decision that has created tremendous enthusiasm is the decision of
the government to allow DTH services in Ku-Band. The Communication Convergence
Bill, which is waiting to be introduced in the parliament, holds a lot of
promise for the broadcast industry. The report has been put up on the DoT site (www.dotindia.com)
and the Ministry of Information and Technology’s site (www.mit.gov.in) to
elicit response from the concerned people. The stakes are high, as there are a
large number of viewers, with sixty million TVs and thirty million cable homes.
The recent International Broadcast Engineering Society Exhibition and Conference
held in Delhi, was a clear indication of the tremendous interest that the Indian
broadcasting market has generated for the equipment manufactures, broadcasters
DTH telecast quality is superior to CATV, and users can
receive up to 200 channels. Star TV reports that the size of the DTH market in
India is approximately 100,000 households. However, the technology is such that
it can provide a lot of other high revenue generating, value-added services
Video On Demand
Pay Per View (PPV)
Near Video On
Cable TV Vs DTH
With cable television, you pay a one-time hook-up fee to the cable company to
string cable to your house, followed by a monthly service fee. With satellite
TV, you must purchase the hardware and the programming from a satellite program
provider. The hardware purchase is a one-time purchase. The advantage of this is
that, if you move or travel, you can take the equipment with you. The cost of
programming varies. When DTH is allowed, there will inevitably be a Cable Vs DTH
battle. Cable TV in India is relatively inexpensive, though the trade-off is at
the cost of picture and sound quality, as well as various other advanced
features that DTH offers, like parental lock (you lock out any channels that you
do not want your children to see), on-screen programming guide and upgradable
software–via the satellite.
Of course, the market will decide on who emerges as the winner in the Cable
Vs DTH battle. But, whether this technology gives the consumer more of a choice
in his entertainment/infotainment fare, or the cable companies rally to give
better service, the winner is going to be the consumer.
Tough Game, Worth Playing
in a climate of interlocking concerns, have often cautiously examined satellite
Trans-border flows & loss of national control:
The DTH end-to-end service value-chain is complex,
technologically sophisticated and includes almost all aspects of broadcasting,
such as satellite ownership/bulk leasing of transponders, large scale
broadcasting studios/up-link earth-station, acquisition/production/arrangement
of many programming channels, user-friendly creation of an Electronic Programme
Guide, sourcing/distribution/technical support of subscribers reception
equipment, elaborate marketing of DTH services, comprehensive subscription
billing systems and revenue collection, etc.
|How They Do ItÂ|
In the US, Satellite Home Viewers Improvement Act (SHVIA) covers the DTH satellite industry.Â
Among other things, the law requires the FCC to establish rules for satellite companies with regard to mandatory carriage of broadcast signals, re-transmission consent and program exclusivity. The FCC must also make recommendations on the Grade B signal standard and improve the computer model that predicts signal intensity at a household for the purpose of determining eligibility for receiving distant television broadcast signals via satellite.Â
This law generally seeks to place satellite carriers on an equal footing with local cable television operators when it comes to the availability of broadcast programming, and thus gives consumers more and better choices in selecting a multi-channel video program distributor (MVPD), such as cable or satellite service.Â
SHVIA gives satellite companies the option of providing local broadcast stations to subscribers living in the station’s local market area. This is referred to as “local-into-local”. SHVIA makes the provision of local channels a choice, not a requirement, for the satellite company.Â
The new SHVIA also addresses the satellite re-transmission of distant television stations to subscribers. This applies to television broadcast stations that are not from the subscriber’s local market. Subscribers who cannot receive an over-the-air signal of Grade B intensity using a conventional, stationary rooftop antenna, are eligible to receive these distant signals.
The Canadian regulator, CRTC, under the Broadcasting Act regulates the DTH satellite TV market. Initially, anyone wishing to distribute DTH services was required to obtain a license ensuring compliance with the Broadcasting Act, most importantly with its Canadian content requirements. However, in August 1994, the CRTC exempted potential DTH distributors from licensing, provided they met certain criteria. In particular, DTH distributors wishing to be exempted are required to make exclusive use of Canadian satellites.
What becomes most significant is that the DTH operator and
satellite service provider usually controls all this directly. Presently, there
is no other service in broadcasting where one person controls almost all aspects
of the business directly. Therefore, a comprehensive regulatory framework is a
The transmission of culturally inappropriate material/Americani-zation
of national culture:
Often, concern is expressed about the threat of foreign
broadcasting networks beaming in their programmes onto an unsuspecting Indian
public and the kind of programmes that are being beamed by media conglomerates,
which are merging into ever-larger mega-corps. These mergers are taking place
because the companies are trying to achieve economies-of-scale in a marketplace
where costs are extremely high.
nÂ Market size: In the year 2000, 69- million of
India’s 200-million households will possess televisions–30-million of
which will have CATV. Indian households with cable services, increased from
21-million in 1998 to 25 million in 1999. It is expected that 30- million
households will have cable service by 2000. The number is expected to grow
by twenty percent over the next five years. There are around 2- million
multiple-TV households right now, with DTH that number could easily double.
India is poised to enter the digital domain faster than people think. In
another two years, with technology like Multipoint Microwave Distribution
System (MMDS) and net television, the whole digital domain is going to open
up very fast
Since India’s population crossed the one billion mark, it is no surprise
that satellite operators and programmers world-wide have set their sites on
the world’s largest open market for DTH satellite TV services. For years
now, large C-band satellite dishes have been sprouting up across the Indian
subcontinent like mushrooms. Hundreds of thousands of Indian homes now
receive satellite TV broadcasts directly, while millions of additional
households watch satellite TV programming, courtesy of their local cable TV
Popularity of satellite channels: The growing popularity
of TV as a communication medium has resulted in the TV media sectors
undergoing a rapid transformation. The Zee TV channel catalyzed the industry
into a high growth spiral, when it initiated operations in 1992. Zee’s
success tempted several other private players to enter the business,
resulting in overcrowding. Apart from all the Zee channels, other major
satellite channels avidly watched by Indian viewers are Star TV, Sony TV,
Home TV, BBC and CNN. There are regional language channels, which are major
players in their respective territories, such as Sun TV and Vijay TV.
64 satellites skirt over Asia and more than 120-channels beam down programs.
Approximately 50 of the 120-channels can be viewed in India. It is
anticipated that the proposed broadcast bill will, among other things,
provide DTH digital transmission in the country. However, owing to the high
cost of license fees, transponders and decoders at the subscriber level, the
number of DTH customers is expected to remain low for the first few years.
When DTH transmissions are permitted in India, the market will open for the
following types of equipment–Ku-band dish antennae and Integrated Receive
Decoders (IRD). A study on the Asia-Pacific region conducted by the UK-based
cultures group shows that there will be a demand for 200,000 decoders in the
region by the year 2000. Forty percent of this demand will come from India.
The cost of each decoder is estimated to be approximately US$950 million.
Thus, the total market for decoders in India in 2000 is estimated at US$190
Regional focus: DTH can help in narrower targeting of
satellite delivered services, rather than a single regional service,
allowing programming to be more directly geared to the interests, language
and culture of the particular audience, as well as providing a vehicle that
integrates and offers locally produced and local language material. With
digital compression, this technology also offers the opportunity for each
satellite to deliver more channels and to target them more narrowly.
DTH is a very expensive game: This kind of high-tech
endeavour is money intensive, and in fact, even abroad, various big
companies have found that it is not an easy task to bring about
profitability in DTH operations. India might have an impressive market as
far as numbers are concerned, but nobody can really predict whether people
will spend or not. It has been estimated that for a subscriber, a connection
could cost Rs 15,000. A figure of Rs 500 per month has also been mentioned,
though all this is a matter of conjecture. The advantage of DTH is that
there would be many channels and much more clarity. Other than
entertainment, DTH has potential in education and training applications, as
was shown by the SITE experiment.
Much of the investment in DTH is likely to be the cost of
subsidising the set-top boxes.
The other crucial factor is the subscription fee per month.
In the UK, Zee’s DTH service sells at Â£1.29 (approximately Rs 100) per month.
At that price, ISkyB would be a steal. But Star’s intention is to price ISkyB
at a premium level, a value-enriched service that’s clearly out of competition
or comparison with cable. Sceptics feel that this is precisely the mistake that
could turn Star into a plummeting meteor. Channels may follow the revenue model
of a refundable deposit of Rs 5,000 for the box and a subscription fee of Rs 500
per month for the first 50-channels, with a nominal surcharge per extra channel.
A satellite channel’s approach to film buying is certain to
be a key strategy in this battle for Indian eyeballs. Another carrot for viewers
is big sports events. Since, ESPN and Star Sports have already merged and
running now as pay channels, all they have to do is buy, say, exclusive live
telecast rights to the World Cup and offer it only to DTH subscribers. If only
for the duration of that tournament, every cricket watcher in the country will
subscribe to DTH. Hopefully, once exposed to DTH, a large number will upgrade.
The Road Ahead
In conclusion, it has now been over a decade since DTH
satellite broadcasting began to show promise as a new technology capable of
widespread distribution of programs and services. In those early days, the prime
concern of many governments was that the spread of DTH satellite would result in
mass Americanization and a decline in the cultural values and ideas of their
people. The solution that has to be found is to maintain some form of national
control, ranging from outright ban on ownership of satellite signal receiving
equipment, to introducing licensing regimes, prescribing guidelines for program
content and placing limits on foreign ownership of broadcasting licenses or
ventures. India has to change its laws and policies so as to strike a balance
between the economic benefits of introducing new services, the consumer demand
for change and the government’s overriding interest in maintaining control
The DTH industry is still in its formative years in the Asian
market, as evidenced by the ever-evolving list of existing and potential DTH
operators. Equally, the level of change matches the state-of-flux in the
industry and in the applicable laws of the countries affected by DTH. It remains
to be seen how each country in Asia will strike the final balance in the
structuring of its laws and regulatory scheme to maximise the benefits of the
new technologies, whilst ensuring that the national and public interests in the
control and content of those services are protected.
Issues To Be Considered
Universal service, broadcast of local TV signals,
retransmission of broadcast signals, etc.
The DTH operator is understandably inclined to use proprietary technologies
in hardware and subscription management software systems, with the sole
objective of keeping the subscriber-base fully captive. This technological
approach seriously affects interoperability and compatibility between the
competitive systems sacrificing the customer interests and the universal
There should be co-ordination between the national
satellite policy and the ITU to avoid transmission clashes.
Foreign equity participation.
Content control (advertising and programming guidelines).
Cross-service restrictions between cable operators and
Competition and pricing of services.
DTH delivery service should be free to choose the
technology mix to distribute the services, subject to the condition that the
receiving equipment should be interoperable.
It would not be possible to have any meaningful
regulation for satellite broadcasting services, particularly those
originating from outside the country, unless the associated distribution
services are also brought under the regulatory framework.
The TRAI and the BAI need to be merged because
technologically, telecom and broadcasting are getting more and more
This article is extracted from a report prepared under the guidance of
Professor V Sridhar by Avinash Thakur, Samir Sudhir Adbe, Saurav
Banerjee, Vineet Agarwal and Yogender Kumar Tiwari, all second
year students at IIM Lucknow.