B4U Multimedia International has spun off a new company B4U Broadband, which will be the vehicle for the company‘s broadband plans.

B4U CEO Ravi Gupta made the point clear while clarifying that B4U Multimedia International had not been wound up as reported in the press due to its association with arrested film financier Bharat Shah, a key promoter in the company.

Gupta, however, admitted that one reason for the creation of the company was because national broadcaster Doordarshan was reluctant to continue an association with a company part promoted by a man with alleged links to the underworld.
B4U Broadband will continue to provide the latest blockbusters to DD as per our earlier arrangement,‘‘ Gupta confirmed.

Queried whether the Bharat Shah episode had hurt the channel, Gupta said actually revenues in January were better than previous months. "AS to whether they would have been even better without the arrest episode is speculative," Gupta added.

B4U Broadband will be the vehicle for a number of projects, including DTH, which the company is aggressively pushing through in the coming year, Gupta said. "For the DTH project we have calculated an outlay of Rs 5 billion and we are in talks with various prospective partners. We have to obviously keep in mind the government‘s insistence on the 20 per cent sectoral cap as well as foreign equity cap but we are seriously going ahead," Gupta said.
As to what other plans were on the anvil, Gupta said B4U was going ahead with plans for content delivery via the internet. He however ruled out B4U‘s getting into optic fibre cabling on its own. "We will be looking at collaborations with players providing such services", Gupta said.

"We are also looking at global alliances and towards that end we are in serious talks with British Telecom," Gupta said.

Star‘s bouquet of channels, which had been off air in the Delhi region for MSO Siticable‘s subscribers since 24 January, began beaming again on Thursday in what may well be a temporary truce in an increasingly high stakes turf war.

Since pending dues have been paid up by most Siti JVs (joint venture partners) and suboperators, the feed will be switched back on all across Delhi, Star‘s corporate communications head Yash Khanna said. There are only a few suboperators who are still to pay up, Khanna added.

Speaking for the other side, an industry source close to Siti said Star came around not over any dues issue but because the blackout of Star‘s feed was hurting their channels‘ TRP ratings in the Delhi and Ludhiana (Punjab) areas which in turn was leading to increasing pressures from their advertisers.

The differing statements indicate that the problem is a larger one of how big MSOs and channels conduct business. The present dispute had its roots in the issue of paid connectivity which is a recurring one (recall the recent spat between Sony Entertainment Television and Hathway Cable in which Star has a 26 per cent stake) as well as who the various JVs ally with. Siti has a 35 per cent cable home share in Delhi because of the 77 JVs who are allied to it. At the height of the dispute there was media reports that JVs were defecting to the Star camp, a claim Siti vehemently denied.

Its a war of attrition that is going on and it may well lead to the government stepping in to regulate the whole business.

Cable operators and control room owners in the western state of Maharashtra are up in arms over what they term heavy handed treatment from the authorities on the issue of entertainment tax arrears.

They are now demanding the complete scrapping of the tax saying it is impossible to implement in a rational manner and have instead suggested that the government charge a one time tax on the purchase of new television sets.

Matters came to a head after a recent directive from the government to get tough on defaulting operators following which certain operators were arrested and control rooms seized.

The issue has been hanging fire for over six months following the doubling of entertainment tax per connection per month from Rs 15 to Rs 30 in municipal areas and from Rs 10 to Rs 20 in other parts of the state. It may be recalled that operators went on strike over the issue in August 2000 after which a committee representing operators, the government and consumers was set up to resolve the issue.

Mumbai-based Live Satellite Media promoter Atul Saraf, who is on the committee representing cable operators accused the government of putting forth unreasonable demands.

Saraf said a number of options were being considered which included blacking out all news channels or even a total shutdown similar to what was witnessed in August. If the government still refused to come around they would move the courts, he said.

Despite meetings with revenue minister Ashok Chavan and one with finance minister Jayant Patil last month, there appeared no solution in sight, Saraf said.

Saraf cited the situation prevailing in the eastern state of West Bengal to buttress his argument, where he said a one-time tax was paid on the purchase of new television sets. "West bengal charges no entertainment tax so why should there be one here?" he asks.