The shakeout in the television business continues. Several channels have shut down, some are struggling to stay afloat and are laying off people as advertising and subscription revenues continue to shrink. This makes for a prime environment for mergers and acquisitions.

Into this fray has stepped Zee Telefilms once again, which has made a couple of botched efforts at trying to acquire other channels or forge alliances. (Asianet and UTN are some of the alliances which failed.)

B4U CEO Ravi Gupta: squashing takeover rumours

In its current attempt, it is apparently trying to take over the entertainment channel B4U Television Network once again, according to a report in The Hindustan Times.

Sources say that the deal is likely to focus on acquisition of the impressive B4U movie library. B4U CEO Ravi Gupta had told indiantelevison.com recently that the channel holds rights to 1,000 films in India and overseas rights of 1,600 films.

Zee chairman Subhash Chandra: once bitten, not twice shy?

The Zee Network is apparently in a hurry to strike a deal. The reason: its agreements for telecast rights for a large chunk of its movie library are reportedly expiring this year. (In 1994, the company had acquired several movies from various producers with licences ranging from five to seven years.) The channel needs to bolster its stock of films for the days ahead.

As part of the deal, reports say, Zee will also get B4U‘s lucrative international operations, including UK and US, reports said. In UK, B4U has around 40,000 subscribers. With B4U Movies, the company had broken even on cash basis in the overseas marketing during the first year of operation, reports said.

This is not the first time that Zee Telefilms is trying to acquire B4U Telelvision. Earlier in May, the Subhash Chandra-promoted Essel Group?s investment companies claimed to have advanced funds for acquiring a 15 per cent stake in B4U Multimedia (now B4U Television Networks) from the disgraced stock broker Ketan Parekh. The company had then refuted these claims saying that Parekh?s holding was between "four to five per cent".

The Indian Cab & Sat Reporter, indiantelevision.com‘s weekly subscription newsletter, had predicted earlier this week that Star‘s announcement to slash carriage rates was merely an eyewash, and that it would hike rates eventually.
We present here the full text of the item that appeared in the Indian Cab & Sat Reporter dated 8 November 2001:

MUKERJEA PULLING A FAST ONE WITH TALK OF SLASHING SUBSCRIPTION RATES?

Star India CEO Peter Mukerjea is mouthing a new mantra these days. Slash basic carriage rates for cable ops for the Star digital bouquet of six channels if they in turn are willing to declare higher subscriber bases.

For the cable TV trade it is likely to be a Catch 22 situation. If they refuse to buy in to the higher disclosure or higher subscription schemes and their headends are switched off, they will face flak from the viewers who have become diehard fans of Star Plus, the numero uno entertainment channel. Clearly, this will be a hard fought battle.

In a volte-face, Star TV has announced a hike of Rs 12 in cable subscription rates for its digital bouquet of six channels, with effect from January 2002.

Star, which had announced its intention to lower rates earlier this week, will charge cable ops a basic rate of Rs 42 per subscriber, as against an average of Rs 30 now, when the rate hike becomes operational. The channel has taken a decision to make the announcement currently because its contracts with some cable ops stipulate that a 60 day notice period be given to them if a rate hike is being resorted to.

The move is likely to have a ripple effect on how much individual subscribers pay for receiving cable TV in their homes: observers expect cable ops to eventually hike the rates they charge subscribers from Rs 75-Rs 175 prevalent currently to Rs 100-Rs 225 (depending on whether the subscriber is in a posh or poor locality). This translates into a hike of Rs 20-50 per subscribing home.

That is after the dust settles down. Observers expect cable ops to get into a major scrap with Star India‘s distribution team for daring to take the step to hoick basic subscription fees.

And that too when Star India CEO Peter Mukerjea had as recently as two days ago declared in the media that his network was planning a cut in basic subscription rates, if cable operators were willing to disclose higher subscriber bases. Mukerjea‘s justification of the new hike is that operators did not respond to the channel‘s clarion call.

Star India CEO Peter Mukerjea

Mukerjea told The Times of India: "We have 38 million cable homes across the country and we receive payment for just 6 million cable homes. Because of the under declaration of subscribers by the cable operators, we have no option but to increase prices.‘‘

The announcement of the hike comes close on the heels of I&B minister Sushma Swaraj‘s indication at the FICCI meet this week that the government is thinking of restricting advertisement telecast on pay channels.

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Dot biz is a restricted gTLD (Global Top Level Domain) open only for companies engaged in commercial or business activities. Charity organisations and individuals cannot use the extension. Market sources expect demand for domain names to cross 40 million by the end of the year.

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