The Conditional Access System that is being introduced in India for Cable TV channels in four metros from July 14 will bring in significant changes to the Convergent media scene in India.

The changes that are likely to happen are both in the commercial aspects of the way Electronic media will be operating, but also in several regulatory aspects.

On the regulatory front, the Government has fixed that a minimum of 30 channels have to be offered by every Cable operator as "FTA" (Free to air" channels at a maximum subscription of Rs 72 per month. Many of the Multi System Operators (MSO) who are presently operating as "Super Cable TV Operator" have announced that they would be offering nearly 60 channels under this free category.

The Channels which are categorised as "Pay Channels" are those for whom the broadcaster is charging a fee from the MSO and such channels have to be provided through "Addressable Systems" or Set Top Boxes (STB).

It is claimed in support of the system that CAS would give a choice to the consumer in selecting channels and paying only for the Channels that he chooses. One section of the Community is expressing opposition to the system fearing that the system will increase the cost to the consumer without corresponding benefits.

Some of the key issues that require debate in this regard are as follows:

1. Bunching of Channels:

Presently there is a system of bunching of channels under which a broadcaster is offering a bouquet of channels to the MSO at a fixed total price. It was clarified in the media some time back that Government will not allow such  packages to be forced on the consumer.

However, the proposal has resurfaced in the MSO s meeting on June 12th where different broadcasters are reported to be planning a bunching of channels on the basis of category. i.e., instead of the earlier bunching of say Star Plus with Star World, Star Movies etc, present bunching would be Star Plus with Zee, Star Cinema with Zee Cinema etc.

It does not require any deep thinking to understand that this proposal is again defeating the purpose of CAS since the choice of the consumer is taken away. If anything it is worse than the earlier system since this forces the consumer to subscribe to duplicate channels of the same category.

2. Profile of Free Channels:

The Cable TV Regulations Act 1995 mandates that all channels that are broadcast by the Cable TV operator subscribe to some programme code. It is widely believed that channels such as FTV and MTV frequently overstep the prescribed code.

According to the current reports, the FTA channels will include channels such as FTV and also Al Jazeera and PTV.

It is strange that channels that are likely to stray out of the programme code and also carry news which may destabilize the communal harmony in the country and possibly be a threat to the unity and integrity of the country would now be beamed under the FTA banner with a de-facto endorsement from the GOI as "Consumer Friendly" channels.

The possibilities of several foreign channels engaged in both political and religious propaganda flooding the FTA channel space is looming large on the Indian scenario. These channels have deep pockets and the long term impact of such channels can only be detrimental to the interests of the country.

3. Advertisements in Pay Channels:

Presently, the TV broadcasters are having two revenue steams. One is the advertisements and the second is the subscription collected through the Cable TV operators if the channel is a Pay channel. The complaint of the channel owners is that there is a gross under reporting of the number of consumers and hence they are not getting their full revenue for the pay channels. The CAS system is expected to correct this problem and provide them the correct estimate of the number of pay subscribers.

With the new system coming into play, there will be an endorsement of the Government for this dual revenue stream. As a result, it would be legitimate for the Pay channels to also carry advertisements.

In the Internet media to which the TV broadcasting is converging , there is a clear norm as well as law (in some countries other than India) that "Unsolicited Advertising" amounts to an offence called "Spam" and is punishable.

The logic for making "Spam" an offence is that the subscriber is receiving the content at a price and delivery of spam reduces the content value besides "annoying" and "disturbing his mental peace".

With the Convergence Act likely to become law in India, there will soon be no difference between TV broadcasting and ISP business. The laws for both has to be uniform.

Even now, if the channels are broadcasting in digital form then the Information Technology Act already recognizes the video stream as a "Sequence of Electronic Documents" and hence the laws of the Cyber Space could be applied to Digital TV broadcasting as well.

It is therefore inappropriate for the Government to support a system which is against the global convention and against the laws of many countries.

Some time back, Ms Sushma Swaraj did mention that the advertisements in Pay channels would not be allowed. However it appears that she has been effectively silenced by the industry.

It is necessary to debate this aspect in great length.

Firstly, if there present contention that only around 30 % of the consumer number is reported, then the introduction of CAS should raise their subscription income by more than 3 times. If the total ban on advertising in Pay channels are not considered  practicable, then the Channel owners have to provide justification for the same in the light of such increase.

Secondly, there is presently no norm in the industry for Ad-Content ratio. Unlike a newspaper ad, where there is a norm and besides the reader has an option to skip the ad and read only the content, the TV ads are a forced intrusion which cannot be even filtered like the Internet ads. The degree of annoyance to the consumer is therefore higher in TV ads than Internet or Print ads.

The industry should therefore either agree to "No Advertisements in Pay Channels" and accordingly price their channels or agree to a ad-content ratio for each programme with a ban on ads within the programme time.

The ad-content ratio has to also make a distinction between live event broadcasts and serials since the ads in the live broadcasts may irretrievably lose content for which the consumer has paid money.

One formula is that the ad content of serials in pay channels should not exceed 15 % of broadcast time and ad content of live events in pay channels should be zero. In the FTA channels this can be relaxed to 25 % and 10 % respectively.

The channels can work out the economics of going Pay or going free and pricing their slots based on the 10 % of content time available as ad space.

A strict regulation in this regard is required as a part of the CAS implementation.

4. The Threat to Consumer:

The Cable TV regulation act of 1995 and the amendment are essentially acts to regulate the industry. Hence the penal provisions of the act apply only to the Cable TV operators. However, in the coming days when Convergence Act becomes law, there is a clear provision where the Consumer will be  punishable for any "Benefits Received" through a service which is not according to the law. This means that if the Cable TV operator provides a Pay channel without collecting money and has doctored the STB to suppress the information to the broadcaster, then along with the Cable TV operator, the consumer may also go to jail and pay fines.

In the run up to the Convergence Act, it is not inconceivable for regulators to start interpreting any violation of law on the part of the consumer as "Contributory Offence".

With the availability of STB s in the grey market and the possibility of manipulation of the STBs the threat to the Consumers being either lured into violation by a friendly cable operator or being taken in by ignorance are very high.

The anti consumer provisions in the Convergence Act has to be closely watched and removed before it becomes a law. In the meantime, it should be ensured that consumers should be indemnified against any liability for violations of the Cable TV operator through an appropriate notification.

 

 

Naavi

June 13,2003

Related Article:

Spam Enters Indian TV Broadcasting

 

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