The changing scenario of Tamilnadu Cable industry

The Arasu Cable TV corporation was launched yesterday by Chief minister M.Karunanidhi yesterday. The maiden service of this first of its kind, Government owned cable network started of in Thanjavur. Thanjavur, Tiruvarur, Tiruchi, Nagapattinam, Perambalur and Ariyalur are the towns which will recieve signals from ACTC now. Nearly 50 out of 60 cable operators of Thanjavur town have switched allegiance from the only other MSO. Except for Surya and chutti Tv remaining of Sun network is not carried by ACTc as of now. While the government claimed yesterday that it will start beaming Sun network also in a week’s time Sun network afficials clain that Arasu cable is yet to apply for its service. Except Surya and chutti remaining channels of Sun Tv are pay channels. So nearly 84 % of Thanjavur cannot see Sun Tv today.

Sun Tv is the most popular channel in Tamilnadu today. Inspite of many new channels including Kalaignar tv coming in the past year, its hold over the prime time is still strong. In June RCV, a MSO started by Azhagiri son of the CM started operations in Madurai without Sun Network in its list of channels. This was initially a ploy by them to erase Sun from the viewer’s choice. However due to customer pressure they tried to rope in Sun network, which the network refused on technical grounds. This resulted in overwhelming customer ire and many switched to sun direct, a DTH service offered by Sun Tv. A similar scenario may erupt in Thanjavur also now, if Sun is blacked out for a month or so. Many cable operators may think twice in other areas to join ACTC if this present scenario is not rectified soon.

Sun TV Network Ltd reported 36.5 per cent growth in net profit at Rs 367 crore for the year ended March 31, 2008, against Rs 268 crore in the previous year. Revenues grew by 27.5 per cent to Rs 926 crore during the year from Rs 726 crore in the previous year. According to a press release from the company, the last quarter also saw sustained growth in subscription revenues from DTH platforms of Dish TV, Tata Sky and its own Sun Direct. Sun TV channels are viewed by more than a million DTH subscribers and it is expected that revenues from this platform will be an important growth driver in the years to come. Sun direct registered one million subscribers within 200 mdays of its operation. The present scenario is condusive of expontial growth for it especially in Tamilnadu. At present for Rs 2899, one can enjoy 75 channels of digital quality through Sun Direct for two years, while one will have to spend Rs 2400 for ACTC connection for the same period and that too in analague mode. With its impressive financial performance Sun dieect can afford to fine tune its offer even more and that will result in a landslide in its favour. However whether it is in a position to give quality service with such growing subscription base is a question. But going by SCv’s record it looks it is a dependable company.

At present a cable operator requires to pay Rs 500 as annual fees to postal and telegraph department and do his operation. TRAI , yesterday has suggested cable TV reforms by proposing Rs 10000 as license for district level and Rs one lakh as state level for operations in cable industry , valid for five years. It has proposed one lakh and Ten lakhs for MSO in district and State level [ 25 lakhs for National level.]

TRAI wants new local cable operators to digitise their networks in three years from the date of issue of licence as part of their performance obligations. Existing players will get five years from the date of notification of the new licensing regime, after which no licence for analogue will be granted. Multi-system operators starting digital operations will be given a 50 per cent reduction on the applicable entry fee for the first time. Existing MSOs will have five to seven years. According to the industry, with high volumes the basic analogue to digital conversion would cost Rs 500 per set-top box, while a CAS box would cost around Rs 1,500. Digitisation will also increase the number of channels offered. TRAI expects to complete digitalization by 2010 in time for common wealth games. However, this would involve huge capital investments in upgradation of cable network. The subscriber too would have to invest in set-top boxes or digital receivers.

Dish Tv has announced new Hattrick scheme. Sun Direct DTH is already very aggressive with multiple choices and low entry cost. Tata Sky has reduced its monthl fees and entry cost. Big Tv by Reliance and Bharti Airtel DTh and Videocon are also entering DTH with big ambitions. At present there are over 128 million television owners in India. Out of which 78 miliion are through cable. At present Dish Tv leads with 3.6 million subscribers. Tata has around 2 million and Sun direct one million plus. By 2010 it is estimated that around 15 million will have DTH in India. Reliance Big Tv is expected to start by August end. They have an agressive plan to rope 5 miilion at the start itself. They have ordered 5 million set top boxes to a korean and Taiwanese company. Big Tv is expected to offer connection at Rs 1000 including STB and also offer 20 movies a week. There will be more pice war in recent months.

IPTV is also catching up. Bharathi and Reliance are coming in here. The MTNL I-Control subscription is Rs 199 for Delhi with 120 channels including Sony Television, Star Television, Zee Television and so on. The subscription for Mumbai is Rs 100 which includes 100 channels and the company will soon increase the number. The company also plans to enter Northern India including Himachal Pradesh, Rajasthan, Haryana , Jammu and Kashmir and so on. Analysts feel that considering the low tariff plan that Aksh is offering, they may soon eat into the DTH business and not so much of the cable business. World over, while DTH has about 70-80 million subscribers, IPTV has a measly subscriber base of one million. IPTV will require cable connections.

So for a cable operator in Tamilnadu, his costs are going to rise thanks to TRAI and his income is going to be steady or reduce thanks to ACTC plus competition from rival technologies.

Another victim is perhaps the local channels. There are around 900 local channels in Tamilnadu. In Thanjavur, the spat between the MSO and Arasu Cable is making the local channels get gittery there. News is that there are six local channels in the region and the ACTC wants the MSO’S to retain only two so that the revenue for Satellite channels are not affected. Azhagiri, son of the CM also has a local Tv called Dayal Tv. In fact as per a local weekly RCv plans to start operation in coimbatore also eyeing local advertising revenue.

Arasu Cable is no competition to anyone. Being a government company it will have more influence and will always give service at lesser cost than competition, claims the CM. A very clear hint that the competition better close shops. That is why it was very wise of SUN network to go agressive in DTH market.

The cable opearators are facing multiple dangers. One they will be increasingly pulled by different quarters as most MSO’s in the state have political support. For the customer a large state supply of signals may mean poor service in long run and may be less problem solving mechanism as in many government departments of the day.

One thing is for sure, it would take a minimum of six months for a better clear picture and even then things will continue to be fluid. The customer may benefit on quality front but pricing may not fall drasitically in coming months.

In Chennai people who already have CAS connection have a question- what about their present STB?

ACTC should give more answers.

Arasu Cable Inaugurated

The chief Minister M.Karunanidhi today inaugurated the services of Arasu cable TV Corporation in Thanjavur through Video conferencing from Secretariat at 10.00 AM today. Also present were Ministers M.K.Stalin, Anbalagan, Veeraswami,Thurai murugan, Speaker Avadaiappan,Chief secretory Tripathi, It secretory Chandramouli, ACTC Chairman Brijeshwer Singh and MP Kanimozhi.

The Chief minister accepted that as a maiden service by any government in India and perhaps the world, there will be some initial hic ups. However he said they will be sorted out. He said Rs 100/- was fixed , instead of Rs 77 stipulated by Central government as this service will include pay channels. At present there are more than 300 pay channels and it is not feasible to provide all of them now. Only the popular channels have been chosen Some channels are not willing to give their feed which will be approached legally if necessary, he said. about 70-80 pay channels will be available through set top box in Chennai. The rates for CAS will be as stipulated by TRAI.

Meanwhile there are reports that the cable operators are still apprehensive about the rates. the Federation of Cable TV Associations-Tamil Nadu wanted to know whether the charge of Rs 100 would include the service tax being collected by the Centre. It also wanted to know whether the charges would be fixed depending upon the A,B,C and D centres (Corporation, municipality, town panchayat and village panchayat).Queries were also raised by the Federation on the ratio of share of income among the ACTC, SOs and cable TV operators.

The Cable TV Urimaiyalargal Sangam on Sunday said that the Conditional Access System had been implemented only in Chennai and is not applicable even in the outskirts of the city.So, the cable TV operators are forced to collect more charge as they have to pay for the rights for pay channels. The sangam requested the government to implement the CAS through out Tamil Nadu in order to regulate the disparities in the money collection system.

Late News: the cable TV services kicked off without the Sun TV bouquet of channels.
Sources say that the Sun Channels would be beamed in a couple of days time. The channels are off due to some technical issues.However they were denied entry as the inauguration was done within a closed door with Collectors from Thanjavur, Nagappatinam, Thiruvarur and Thiruchirapalli participating.

According to a cable operator in Tiruchirapalli , ‘Sun TV is missing from the bouquet of channels. No explanation has been given as yet. We are flooded with calls from customers’.The officials in the Arasu Cable Corporation have expressed confidence that Sun TV will be made available within the next couple of days.If the Sun TV is not telecast by the corporation, it would result in unhealthy competition and situation would go from bad to worse’

Among the 55 channels offered to the customers by the corporation, a majority of them are free-to-air channels.

Arasu Cable Corporation update

With just three days to go for the launch of the first phase of ‘Arasu Cable TV Corporation Ltd’ in Thanjavur on July 15, local cable TV operators (LCOs) and a multi system operator (MSO) are at loggerheads on how Arasu’s signals should be routed. The corporation, however, has not revealed if the signals would be given directly to the LCOs or through an existing MSO from whom cable operators presently source their signals.

Thomson Grass Valley of France has been asked to set up the digital control rooms and they are importing digital head-ends which would distribute signals.

If there is a deficiency in service, the customer can complain to the ACTVC. Complaints can be made with regard to LCOs overcharging the customer than the prescribed rate, disruption in service for a long time, and the like. The ACTVC has also come forward to provide set-top boxes and cable connection to the consumers directly, if the local cable operator does not sign up with the ACTVC.

The Tamil Nadu Government on Saturday fixed Rs 100 as the monthly subscription rate for availing of cable TV connection from the State-owned Cable TV Corporation, even while the operators were apprehensive that only free channels could be aired for Rs 100 and not the pay channels. cable operators wanted the inclusion of pay channels like Star Sports in the ACTC package.

The operators said that for providing a single connection and maintaining it, they had to spend Rs 35 in urban areas and Rs 60 in rural areas. The cable operators were paying around Rs 20 crore to the pay channels.There is a possibility that the viewers would switch over to Direct To Home service if they are charged Rs 100 for free to air channels.

Last heard is Rs 100 max for 70 channels which will also include Pay channels.

Thanjavur- Antennae and other equipment have been installed and a master control room is ready at Thanjavur Cauvery Wholesale Super Market Building. Eight dish antenna’s fromFrance have been installed. The control room will cover eight districts – Tiruchi, Thanjavur, Nagapattinam, Tiruvarur Pudukottai, Ariyalur, Perambalur and Karur. There are about 18000 cable connections in Thanjavur town. About 500 cable operators have joined Arasu cable corporation. At present they collect Rs 100 to Rs 120 per customer. Arasu has stipulated not to collect more than 100. Almost all the cable TV operators have been approved by the Government and it has also assured to take the programmes through them to households.

Cable Wars- III: Thanjavur Arasu upbeat

Cable wars-III continues

Thanjavur is the first place in Tamilnadu where Arasu Cable Corporation will start their operation on July 15th. The grapevine is many cable operators in the town are expressing/expressed intent to join. There is just one MSO in the town at present and one of their partners is a AIADMK councilor. This is enough a reason for the cable operators to get jittery and survival instincts have forced them to join Arasu Cable. There are around 600 cable operators in the zone. They may form an association, open an office and take direct feed from Arasu Cable, it is felt.

At present there are many Local channels running in most towns of Tamilnadu. The fate of them in the new set up is a Question mark. Most of them screen new movies and that is their main strength. If they join Arasu, they will not be allowed unless they have copyright/permission. Suppose they broadcast from existing MSO then may be their eyeball count may drop down.

Will the customer benefit? This is the moot question. If a particular town fully joins Arasu, it will be deprived of local content as local channels may hesitate to join. Also Local channels if they join may be forced to “toe” the line.

In Thanjavur, already cases have been foisted against the only existing MSO for cutting rival lines [?] and because of an altercation one of the local channel broadcast has been withdrawn by that MSO.

Will Arasu Cable also at its discretion stop broadcast of any channel? What policy will it have towards local channels? How competitive will it be especially in areas like Madurai? – These are some of the ethical questions without clear answers as of now.

Meanwhile the Tamilaga Cable TV Operators Welfare Association has extended support to and assured co-operation for the Arasu Cable Corporation. The Association exhorted the other cable operators to extend support to Arasu Cable Corporation and not be carried away by rumours.

Construction works are under way for the Cable Corporation’s control room for Coimbatore at the Omni Bus Stand on Sathyamangalam Road. The control room is expected to become functional by August 15, offering quality transmission of channels at reasonable rates.

The digital control room to be set up by Arasu Cable Corporation in Tirunelveli will cover Madurai, Tirunelveli, Kanyakumari, Tuticorin, Virudhunagar, Ramanathapuram, Sivaganga and Theni districts. Apart from Thanjavur, Coimbatore and Tirunelveli control rooms would be established in Vellore and Chennai.

Chennai operations is scheduled to start on September 15th. Coimbatore, Tirunelveli and Vellore operations will commence from August 15th.

The Chennai address is as follows
“Anurag” No.15, Murray’s Gate Road Alwarpet Chennai 600 018Ph : 24997912 Fax : 24993377 Email : arasucabletvcorp@gmail.com

Will the customer benefit?