MUMBAI: Day one of FICCI FRAMES 2014, the 15th chapter of the annual convention, witnessed a couple of significant announcements by Information & Broadcasting Secretary Bimal Julka.
“DTH operators have complained that the limited transponder capacity has led them to completely depend on the Ku band. We are engaged in discussions with ISRO (Indian Space Research Organization) and the Department of Space to ensure this problem is resolved at the earliest,” said Julka in an assurance that the I&B Ministry was seriously looking at DTH operators’ demand for more transponders.
With taxes levied on DTH platforms currently including an average of 10 per cent of entertainment tax, licence fees, additional customs duty on set top boxes (STBs), service tax and spectrum charges, Julka touched upon DTH players’ demand for rationalizing taxes so as to help them boost investment in infrastructure development and customers’ activation. “We are in talks with the Ministry of Finance and a consultation on this is on its way. We should be able to resolve the issue soon,” he said.
On the subject of applications for launching new channels pending with the Ministry, Julka said, “An inter-ministerial committee has been set up under the I&B Ministry to look at granting permissions. There are around 800-odd channels currently, while 245 applications are pending for grant of permission. On one side, we get complaints that there are not enough revenues for broadcasters, while on the other side, we are flooded with applications for grant of permission for channels.” He said that in times to come, there would be a large number of mergers and acquisitions among broadcasters. The I&B Ministry is also in talks with the Ministries of Home Affairs, Corporate Affairs and External Affairs to ensure a more smooth process for granting permissions. “At least now, the Ministry of Home Affairs has granted permission and security clearance for channels-to-be for a period of 10 years,” he said.
During his speech, Julka highlighted the strong partnership the Ministry shares with various stakeholders. “We have come out with policies that bring in a paradigm shift in the Media and Entertainment (M&E) industry. We are at the cusp of a major change with digitization, and this will help India put its best foot forward. The change has to be supported by liberal progressive policies that will encourage investment and ensure sustainable business models, promote entrepreneurship and create innovations,” he said. India has 77 million cable TV homes, of which 29 per cent are serviced by DTH operators while Doordarshan’s Free Dish reaches out to nearly 9 million homes. There are roughly 396 non-news channels and 60,000 cable TV operators, 6000 multi system operators (MSOs) and approximately 360 broadcasters; he informed, pointing out that the first two phases of cable TV digitization had been completed in about 42 cities with over 30 million STBs installed. “This was a mammoth task which has been undertaken with the coordination of all stakeholders,” Julka said. “About 110 million STBs are required to be installed in phases III and IV of DAS. Unless these phases are completed, we will not be able to fully harness the fruits of digitization. This is an excellent industry for employment generation.” Lavishing praise on digitization, he said, “It will change the way television is consumed. It will put India in the league of advanced countries.”
On entertainment tax, he informed that preliminary data from state governments reveals a two to three-fold increase in collection of entertainment tax. “The data from news broadcasters shows approximately 30 per cent reduction in carriage fees in phase I cities and data from MSOs shows increase in subscription fees of about 35 per cent to broadcasters,” he said. Stressing on the need to fill in consumer application forms (CAFs), he said, “This is an ongoing exercise. I hope that the MSOs and LCOs are engaged in this exercise and will soon finish it.”
While digitization would bring in transparency which in turn would bring in foreign direct investment (FDI) in broadcasting, Julka didn’t shy away from acknowledging the challenges. “Filling of CAFs, choice of a la carte channels, computerized billing to consumers, and the revenue sharing module between MSOs, LCOs and broadcasters is taking some time, but I am sure it will be resolved soon,” he assured, adding that the government would step in at any time it deems fit. On the ongoing issue of credible ratings, he said, “We are glad that the BARC has been set up. I will request BARC to speed up its process so that we can generate ratings without any delay.”
Julka stressed the importance of digitization. “We need to see complete digitization throughout the country. Also, there are issues of registration of MSOs, monopoly restriction on MSOs and LCOs, and content monitoring. While vertical monopoly and cross media holding is a big issue, it is also engaging the MIB. We will consult the stakeholders before taking a decision on this,” he said on a concluding note.
