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.

A satellite television channel with a difference was launched on Thursday. The difference is the channel was launched by an Indian cable TV consortium led by Mumbai-based Live Satellite Media promoter Atul Saraf. Branded SN (Shopping Network) TV, it is positioned as a shopping and comedy channel and is in beta testing stage off a transponder on Thaicom-3.

For starters, it will have a four hour block of programming repeated through the day. This will go up to eight hours of original content over time and the ultimate aim is to become a 24-hour free-to-air channel.

Says Saraf: "We will have home shopping programming shorts but we will also offer advertisers the facilities of going beyond just a TV commercial, we will air infomercials. For instance, Phillips can explain clearly what a Flat Square Tube is in its commercial, instead of just airing attractive ads."

Saraf expects the channel to do well. "Live Satellite is a company that gets advertising to the tune of Rs 100,000 for almost 1,200 cable TV operators all over India," he says. "These cable TV operators will support us and we are not really interested in going in for funding at this stage."

The channel is targeted at the eastern, western and northern Indian markets.

Purple Drop, a newly formed global interactive media company with its corporate headquarters located in Silicon Valley, was launched in south Mumbai on Thursday.

Specialising in end-to-end graphics solutions through a market-driven services, products & distribution strategy, Purple Drop‘s model combines expansive offerings in interactive entertainment technologies, R&D on demand, 2D/3D animation, CGI and SFX for the gaming, entertainment and commercial markets, according to a company press release.

Expressing his excitement at the launch, Ashok Desai, founder & CEO of Purple Drop, said: "The time has come for India to venture into radically new business opportunities. Purple Drop plans to leverage India‘s inherent technology strengths as well as the existing knowledge & expertise from the traditional business in entertainment & graphics and synergise it in charting a new paradigm for the industry in interactive entertainment and online gaming."

"Driven by the opportunity to participate in the $9 billion world-wide game industry, we are convinced that this focus will fuel unprecedented levels of innovation and technology advancements in the development of content which will enable Purple Drop to bring products and solutions to a whole new market opportunity," he further added.

Pentamedia Graphics has provided $4 million in seed funding and has permanently transferred a core team of trained professionals to Purple Drop. In addition, Purple Drop has IP rights for Pentamedia‘s graphics products as well as gaming rights for Sinbad and Pandavaas. Purple Drop will also have access to the state-of-the-art infrastructure base of Pentamedia Graphics and rights to an extensive selection of digital assets.

Speaking on the occasion of the launch, Dr V Chandrasekaran, chairman, Purple Drop and chairman & CEO, Pentamedia Graphics, Ltd., said: "Over the past year, we have seen Pentamedia Graphics forge compelling alliances and strategies to respond to the exciting needs of the entertainment industry. The launch of Purple Drop is a proof of our belief that the time is right to respond to this high-end graphics need as a focused entity."