Your SlideShare is downloading. ×
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Multi System Operators - An Industry Perspective
Upcoming SlideShare
Loading in...5
×

Thanks for flagging this SlideShare!

Oops! An error has occurred.

×
Saving this for later? Get the SlideShare app to save on your phone or tablet. Read anywhere, anytime – even offline.
Text the download link to your phone
Standard text messaging rates apply

Multi System Operators - An Industry Perspective

594

Published on

A thought leadership paper on Multiple System Operators (MSO) providing an overview of the Indian cable television industry’s future trends, technologies and challenges faced by them along with a new …

A thought leadership paper on Multiple System Operators (MSO) providing an overview of the Indian cable television industry’s future trends, technologies and challenges faced by them along with a new era of possibilities available in the wake of an increased demand for quality viewer experience.

Published in: Technology
0 Comments
1 Like
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total Views
594
On Slideshare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
0
Comments
0
Likes
1
Embeds 0
No embeds

Report content
Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
No notes for slide

Transcript

  • 1. A thought leadership paper on Multiple System Operators (MSO) providing an overview of the Indian cable television industry’s future trends, technologies and challenges faced by them along with a new era of possibilities available in the wake of an increased demand for quality viewer experience. August 1st 2013 http://www.dikshatech.com Multiple System Operators in India An Industry Perspective
  • 2. Contents Foreword Introduction 2 Multi System Operators (MSO’s) 3 Telco’s & MSO’s 4 The Indian Scenario 5 Indian MSO’S 6 Regulatory And Policy Intervention 6 DTH Leading Digital Distribution 7 New technologies and future trends 7 Personal Video Recorder (Digital Video Recorder) 8 Video on demand 9 The Digital Trends 9 Over-the-Top (OTT) 9 Challenges faced by the MSO’s 9 A New Era of Possibilities 9 Beyond Triple Play 9 More Than Residential 9 The Way Forward 9
  • 3. “This report does not constitute professional advice. The information in this report has been obtained or derived from sources believed by Diksha Technologies to be reliable but does not represent that this information is accurate or complete. Any opinions or estimates contained in this report represent the judgment of Diksha Technologies at this time and are subject to change without notice. Readers of this report are advised to seek their own professional advice before taking any course of action or decision, for which they are entirely responsible, based on the contents of this report. Diksha Technologies neither accepts or assumes any responsibility or liability to any reader of this report in respect of the information contained within it or for any decisions readers may take or decide not to or fail to take.”
  • 4. Foreword P a g e | 4 As telecom experts, Diksha and our consultants have had the privilege of working with many global telecommunications giants. We have witnessed the evolution of the telecom industry over the years and have helped our clients navigate through many challenges. Telecommunications is a rapidly evolving industry with new service models and value propositions being generated on a continual basis. The Indian telecommunications industry is one of the fastest growing in the world. Government policies and regulatory framework implemented by Telecom Regulatory Authority of India (TRAI) have provided a conducive environment for service providers. This has made the sector more competitive, while enhancing the accessibility of telecommunications services at affordable tariffs to the consumers with improved quality. In the last two decades the Indian Telecom Sector has caught the imagination of India by revolutionizing the consumer experience through a wide range of services. The Multiple System Operators, in particular, has undergone a drastic change with recent digitalization measures taken by TRAI. Almost every section within the media and entertainment network is getting impacted by digitalization in a significant way. The Government’s push towards digitalization and addressability for cable television by 2014, is expected to provide a stimulus to DTH and digital cable growth. The convergence between entertainment, information and telecommunication is increasingly impacting the overall media and entertainment industry. The recent recommendations of TRAI for the implementation of digital addressable cable system in India will witness a paradigm shift in the broadcasting sector and unlimited growth potential for the industry. The future of India’s media and entertainment landscape looks extremely promising with changes such as analogue cable sunset date by 2014, and players in the overall media value chain attempting to provide improved content to viewers through effective marketing and delivery strategies. Abhinav Mishra Head Global Strategy & Operations Diksha Technologies
  • 5. P a g e | 5 Introduction An aim to identify and assess the opportunities and challenges of the Multi System Operator’s (MSO’s) in India has driven us to prepare this thought leadership paper on "Multi System Operators - An Industry Perspective". It provides insights regarding the potential solutions available and the impending conduit ahead. The MSO’s have lately been facing hurdles in driving their revenue growth since their traditional business models have become outdated and new entrants are posing a serious challenge to these once dominant players. The cable Average Revenue Per User (ARPU) in India is one of the lowest globally at Rs. 173, compared to Rs. 3360 in the United States. While the residential customers are demanding a world filled with unlimited high-speed services, such as broadband Internet access, broadcast-quality video, and video-on-demand (VOD), the commercial customers are seeking unique voice and IP solutions with strict Service-Level Agreements (SLAs). These opportunities present the daunting task of efficiently and reliably incorporating these new, high-bandwidth services into existing cable networks. This paper provides a background to the MSOs existing structure and the way in which new technologies are evolving to elevate and enrich the viewer experience. India’s growing middle class, rising disposable incomes and high volume of content consumption hold significant growth potential for all segments within this Industry. But competition, shortage of Set Top Boxes (STBs), unfavorable regulations, carriage fees, low ARPUs are preventing the likely growth potential in this sector. India is at the helm of a revolution in digital and HD adoption where the Ministry of Information & Broadcasting has recently validated TRAIs recommendation on increasing the FDI for DTH & IPTV sectors to 100%. These recommendations are positive steps towards the objective of digitalization. This is why perhaps traditional products served well in the past, but may not serve well in the current situation. The cable MSO digital penetration today stands at 5 million. To meet the deadline of 2014, cable service providers have to sell about 90 million set-top boxes to their consumers. Sudheer Velatt AVP – Technology Diksha Technologies
  • 6. P a g e | 6 Multi System Operators (MSO’s) The cable industry has come a long way since the first cable operations were established in the late 1940s. Originally designed to be able to provide television signals to remote areas, cable operators have developed a complex system of services which now includes television, internet, telephone, and wireless services. As the services have expanded, so has the competition, resulting in an industry which is in a state of flux. Cable television came into existence in India in 1983 when Doordarshan started its services on cable networks in rural areas of Rajasthan. In 1989 few entrepreneurs setup small Cable TV Networks and started local video channels showing movies & music videos catering to a small neighborhood. Satellite television was introduced in India during 1991 with the live coverage of the Gulf War by CNN and spread through the launch of channels from Zee and STAR groups. While the media & entertainment market (M&E) in India is relatively small when compared with other countries, India has the third largest television market, in terms of number of viewers after China and the US. Television continues to dominate the M&E sector followed by print and filmed entertainment. The television sector in India has grown at ~12%p.a. (2007-2010) and is estimated to continue this strong growth, owing to healthy advertising spends and increased penetration in semi- urban and rural areas, mainly by DTH. By the end of 2011, the industry is estimated to reach US$ 7.1 billion, a growth of ~14% over 2010. Over 2011-16, the total market size is expected to rise at a CAGR of 14.9 per cent to USD30.4 billion. The next five years will see digital technologies increase their influence across the industry leading to a sea change in consumer behavior across all segments. This paper will examine the future trends in the Multiple System Operators (MSO) industry and the challenges they are faced with. A multiple system operator is an operator of multiple cable television systems. Although the FCC (Federal Communications Commission) defines a cable system as a facility serving a distinct community making virtually every cable operator a – MSO, the term is generally reserved for the major industry players.
  • 7. P a g e | 7 Recently, Multiple System Operators (MSOs) have been on the defensive. Traditional business models are becoming outdated while dominant players are finding themselves under attack by new entrants. MSOs, realizing the need to evolve, have begun to focus on other areas to drive revenue growth. Not only are they beginning to offer new services, but they are also exploring new business models so that they remain competitive. Recent changes in technology, consumer behavior and non-traditional service offerings such as over-the-top (OTT) content, peer-to-peer networking and content provision by new players are starting to erode even the most well-established revenue streams. Not only have these changes dramatically altered the MSO’s competitive landscape, they also present numerous challenges to the position of MSO’s as leading providers and aggregators of video content. The Indian cable and satellite TV however has been drawing-in investors like a honey pot attracts bees. Cable TV has grown significantly with the number of subscribing households increasing from just 410,000 in 1992 to more than 9.4 crore by the end of March 2012, says the TRAI consultation paper. Cable TV subscribers constitute approximately 60 per cent of the total TV homes in the country, whereas the share of DTH is about 35 per cent. Cable MSOs are staring at the changing face of a convergent industry. It's a clash now of content versus context, daily disruptions versus timely innovations, and "immersive" experiences versus "lean back" viewing. With the digital evolution here to stay, enterprises must channelize information technology to aid them in crafting a future where they deliver performance, delight and entertainment – in ways only they can. Telco’s Vs MSO’s As MSOs penetrate the telecom industry, Telcos are gradually shifting to full service operations with IPTV services based on ADSL/LAN/FTTx competing for traditional TV subscribers. Top communication companies are challenging MSOs with a range of new options and experiences for subscribers, which reflect the rapidly efficient development paths of both operators. The growth of mobile broadband services has not only been explosive, but the market gap is immense. Current trends indicate that mobile broadband subscribers will total 1.5 billion by 2014 according to the Huawei industry insights .
  • 8. P a g e | 8 The convergence of industries brings both opportunities and threats. MSOs are no longer satisfying the market with triple services, and have to compensate for a lack of mobility with a bundle of TV, fixed, mobile and broadband services. MSOs are now in a position to offer competitive prices and high quality services through broadband/voice packages plus other services such as free TV, enterprise clusters, IM, and integrated video. The Indian Scenario The MSO’s with the highest revenues and most subscribers can be found in North America, Europe and the Asia Pacific. The majority of MSOs, however, have ploughed through the tough economic times with tremendous growth. The advent of TV services such as interactive voting, online games, and reservations and bookings for various activities, aggressive promotional activities have firmly brought value-added TV to the public realm. Broadcast & CableSat projects the Indian broadcasting and cable TV industry revenue will grow at a CAGR of 12 percent to reach Rs. 54,720 crore (US$11.4 billion) by 2014. The continued digitization of distribution infrastructure, the demand for regional and niche content, and low TV penetration will drive growth in this segment. India is the second-largest pay-TV market in the world, with 108 million subscribers and a reach of 48 percent of Indian households. With more than 600 television channels, India's vibrant media and entertainment (M&E) industry, at Rs. 64,600 crore in 2010, provides attractive growth opportunities for global corporations. Enticed by economic liberalization and the huge volume of demand for leisure and entertainment, many of the global media giants have been present in the Indian market for more than two decades. The majority of India's urban consumption comes from non-metro cities (referred as Tier 2 and Tier 3 towns) - regional markets with distinct cultures, languages and content preferences. Many global film studios and TV broadcasters have already entered these markets and are producing regional-language content.
  • 9. P a g e | 9 Indian MSO’s Some of the prominent national MSOs are Siti cable, Digicable, Hathway Datacom, IndusInd Media & Communication Ltd. and DEN Networks Ltd. Some of the prominent MSOs that are operating in regional markets are ACT, Fastway, GTPL, KAL Cables (Sumangali), Ortel, Asianet, Tamil Nadu Arasu Cable TV (TACTV) Corporation Ltd., Manthan, JAK communications and Darsh Digital. However, the majority of the remaining are small, local (city based) MSOs with a subscriber base of a few thousand. Policy & Regulatory Framework Cable Television Services were brought under the Telecom Regulatory Authority of India in 2004. Further organizing the telecom industry, the government has formed a Telecom Disputes Settlement Appellate Tribunal (TDSAT) which is now available for settlement of disputes between broadcasters and MSOs /cable operators. The Telecom Commission, the highest decision making body of Department of Telecom (DoT), on 02 July approved 100% foreign direct investment in the telecom sector. There is also a talk of increasing the FDI cap in DTH, MSOs and News Channels. However, it is learnt that Ministry of Home Affairs has raised some security issues in hiking the FDI Cap in certain sectors. Improvements in the current taxation regime and increased FDI limits could aid the goal of digitalization in India. Cable Act of 1994 was amended in 2006 empowering TRAI to issue new customer friendly CAS Regulations. TRAI issued three regulations in August 2006 to create a legal framework for smooth implementation of CAS. These included a tariff order, interconnect and pricing regulation revenue share methodology and process and QOS regulation. With TRAI playing and important role in shaping-up the telecom industry, its recommendations and guidelines will be governing the growth. Key recommendations by TRAI are:  Restructuring of Cable Industry with a larger role for MSOs and Digitalization plan within five years  Head end in the Sky (HITS) policy to be announced by Government, TRAI completes all recommendations on this Player Hathway WWIL DEN 50 Cities Digicable Source: Company websites Major MSO's subcriber base Area of operation 13 Major Cities 54 Cities 46 Cities
  • 10. P a g e | 10  DTH policy on tariff and Quality of Services  New recommendations on FDI policy in cable- upto74 % by TRAI  Internet Telephony allowed for ISP’s.  Non CAS tariff regulations for TV subscribers  Cable Companies can provide IPTV. Recommendations cleared by Government. MSOs can consider this opportunity, marketwise  Ala carte choice of Channels by MSOs from Broadcasters in non CAS  New Television Rating points (TRP), Television Audience Measurement (TAM) policy by TRAI.  Greater emphasis laid on network digitization, increased addressability and to encourage voluntary CAS  Incentives prescribed to Multi System Operators (MSOs) to introduce total digitized networks  The registration for cable TV operator to be replaced by a comprehensive and supportive licensing framework  Separate licensing frameworks for Cable TV operators (LCOs) and Multi System Operators (MSOs)  Eligibility criterion made specific to identify the entities who can act as LCOs and MSOs  Option and flexibility to choose Service area given both to LCOs and MSOs  CAS extension to the remaining three metros and subsequently followed by digitalization of 55 cities within a span of 3 years ( with addressability) New Deadline For Cable Digitization The Telecom Regulatory Authority of India (TRAI) has recommended a four-phase digitization process for cable TV in India while setting a sunset date of 31 December 2013 for complete switchover to digital cable. However, the Ministry of Information and Broadcasting, after reflecting on the views of the industry, revised these timelines to set the sunset date as 31 December 2014. Implementation is to be carried out in four phases:
  • 11. P a g e | 11  Phase I: The four metros of Delhi, Mumbai, Kolkata and Chennai by 31 March 2012.  Phase II: All cities with a population of over one million by 31 March 2013.  Phase III: All other urban areas (municipal corporations/municipalities) across the country by 30 September 2014.  Phase IV: The rest of India by 31 December 2014. Conditional Access System – (CAS) CAS or conditional access system is a digital mode of transmitting TV channels through a set-top box (STB). The transmission signals are encrypted and viewers need to buy a set-top box to receive and decrypt the signal. The STB is required to watch only pay channels. The idea of CAS was mooted in 2001, due to a furor over charge hikes by channels and subsequently by cable operators. Poor reception of certain channels; arbitrary pricing and increase in prices; bundling of channels; poor service delivery by Cable Television Operators (CTOs); monopolies in each area; lack of regulatory framework and redress avenues were some of the issues that were to be addressed by implementation of CAS It was decided by the government that CAS would be first introduced in the four metros. It has been in place in Chennai since September 2003, where until very recently it had managed to attract very few subscribers. It has been rolled out recently in the other three metros of Delhi, Mumbai and Kolkata. As of April 2008 only 25 per cent of the people have subscribed the new technology. The rest watch only free-to-air channels. As mentioned above, the inhibiting factor from the viewer's perspective is the cost of the STB. Ditalization Sunset Dates Set By TRAI Phase Area Sugested Revised Timelines Recommended by TRAI Proposed Dates by I&B Ministry Phase I Four Metros of Delhi, Mumbai, Kolkata and Chennai 31st December 2011 31st March 2012 Phase II Cities with Population more than one million 31st December 2012 31st March 2013 Phase III All Urban Areas (Municipal Corporation / Municipalities) 31st December 2013 30th November 2014 Phase IV Rest of India 31st December 2013 31st March 2015 Source: TRAI, Ministry of Information & Broadcasting
  • 12. P a g e | 12 DTH Leading Digital Distribution DTH accounts for 82 percent of all digital TV subscribers in India. DTH players are aggressively expanding into cable-dark rural areas and areas served exclusively by analog operators. A rough estimate indicates that the combined score of the six players of the DTH industry is 45.5 million subscriptions in November 2011. India's Pay-TV Average revenue per user (ARPU) is one of the lowest globally at Rs. 173, compared to Rs. 3360 in the United States. Intense competition in the digital cable and DTH segments, fragmentation, and underreporting in the analog segment, and a price-sensitive market have constricted ARPUs. However, ARPUs are expected to increase, stimulated by the consolidation of analog TV operators and the growth of premium digital TV services. Challenges Faced By MSO’s The challenges faced by this market include a slow regulatory process to define digitization deadlines for cable MSOs and broadcasters, inadequate drive among stakeholders to increase investments in digitization, rapidly changing technologies in recent times that slow Capital Expenditure (CAPEX) decisions and legacy of content on tape across various verticals. At present ISRO have 187 transponders from nine Indian communication satellites including transponders of GSAT 12. It has taken 86.5 transponders on lease basis from foreign operators through its marketing arm, Antrix Corporation Ltd. ISRO plans to increase the transponder capacity by building and launching communication satellite GSAT-9, GSAT-10, and GSAT-11. ISRO will need to speed up the satellite launches in order to meet demand.
  • 13. P a g e | 13 One of the biggest challenges is the legacy of tape and the requirement of rapid digitization, along with efficient asset management solutions. Competitive pressures have further intensified with clearance of licenses for 75 new channels. These are further in addition to the already cluttered Indian television broadcasting space with around 600 channels as on date, where broadcasters are already fighting an intense battle for viewership and struggling to retain its share of the advertising pie. But now the entry into the broadcasting sphere has been made more stringent. This will go a long way in keeping away non-serious channels. The Carriage Fee: The Indian TV distribution industry is dominated by analog cable operators, which is highly fragmented and includes about 60,000 LCOs and 1,000 multi- system operators (MSOs). Around 78.5 percent of cable & satellite (C&S) homes in India are connected through analog cable while the rest are connected through DTH/ digital cable, which provides a near monopoly power to the analog cable in terms of last mile connectivity. India's growing middle class, rising disposable incomes, high volume of content consumption and a conduced regulatory environment hold significant growth potential for all segments of the broadcasting industry. Digital adoption will create additional opportunities for global companies to cater to a new generation of digital consumers. In order to succeed, companies need to understand and adapt to economic and cultural nuances and invest in content and services tailored for local and regional markets. The ongoing structural and regulatory reforms and the development of corporate governance norms will surely mitigate threats including local competition, fraud, corruption and piracy. Unfavorable regulation: TRAI is suggesting a cap of INR 250 on monthly cable charges. With digitization requiring investments to the tune of INR 400 billion, capping the monthly cable charges to an upper limit will only lengthen the recovery of the investments made by the industry. This will in turn make them want to continue on the existing analogue cable as far as possible and may delay the digitization process.
  • 14. P a g e | 14 Shortage of Set Top Box’s (STBs): It is estimated that 65 million STBs will be required in the next three years to complete the proposed process of digitization. At the customer’s end, there are presently delays of installation. Any delay at the procurement end will result in user inconvenience. One of the most important components for digitalization is currently being largely imported. As per the industry experts, local sourcing in short to medium term is not possible as there are no sufficient manufacturing capabilities in India due to following reasons-  No manufacturing capability & lack of readiness: Local manufacturing is in a nascent stage and have limited designing and manufacturing capability for STBs especially for development of software which is the most important part of STB. With the present capability nearly 85% of components and chips will have to be imported from outside India.  Import Duty: Government to incentivize local manufacturing has levied a Customs Duty of 5%, which is currently being absorbed by the sector as part of subsidy to the end consumer.
  • 15. P a g e | 15 New Technologies And Future Trends There is an increasing demand by viewers for more features and better content from the TV channels and cable operator’s lately. New technologies like Internet Protocol television (IPTV), Personal Video Recorder (PVR), Over-the-Top (OTT) and video on demand are revolutionizing the viewing experience. Video on demand Video on demand allows viewers to order movies available in service providers’ library. The movies can be downloaded for a fee. With more than 1000 movies produced in India, Video on demand offer lucrative business opportunity for the cable operators. IPTV Internet Protocol television (IPTV) is a system through which television services are delivered using the Internet protocol suite over a packet-switched network such as the Internet, instead of being delivered through traditional terrestrial, satellite signal, and cable television formats. Over-the-Top (OTT) Another trend that is fast catching up and is likely to change the dynamics of digital media in the Indian subcontinent is OTT or multimedia video consumption. Over-The-Top Content (OTT) describes broadband delivery of video and audio without a multiple system operator being involved in the control or distribution of the content itself. With over 100 million Internet subscribers and about 900 million mobile subscribers, India portrays a high usage of broadband/mobile-delivered content, prodding several content companies to capitalize on this media. However, OTT video delivery requires an efficient set of technologies and infrastructure to facilitate seamless delivery, along with a growing emphasis on online advertising and video analytics. The video content delivery networks market globally is expected to cross US$ 540 million in 2011 and grow at a healthy CAGR of nearly 30 percent from 2011 to 2015, while online video advertising market is expected to cross US$ 4 billion in 2011 and quadruple by 2015, globally. The media industry in India is rapidly changing, new technologies are being deployed across the board - from media capture to media storage and management, to broadcasting global content to the Indian audience; the Internet is playing a pivotal role in changing the industry dynamics.
  • 16. P a g e | 16 Personal Video Recorder (Digital Video Recorder) PVRs facilitate viewing of channel while simultaneously recording the program running in another channel. PVRs allow the viewer to pause, re-wind and re-play live TV. The Digital Trends India is at the cusp of a revolution in digital and HD adoption, with content companies and broadcasters evaluating new media and content delivery alternatives as well as planning significant capital expenditures to upgrade their infrastructure over the next 3-5 years. The conversion from analog to digital television broadcasting will pave the way for broadcast equipment manufacturers, television broadcasters and broadband service providers. Newer ways of distribution of content including IPTV and mobile TV are creating further opportunities for growth. The world digital asset management market is expected to cross US$ 530 million in 2011 and grow at over 20 percent CAGR from 2011 to 2016. Cloud-based services are a fast-growing segment within this market, and Indian companies such as Tata Communications, Prime Focus Technologies, and Airtel are eyeing this space for future prospects. FDI In Television Industry India’s Television industry experienced a remarkable upturn with the initial FDI flow in broadcasting in early 1990s. Today, as the industry looks forward to embark on the journey towards digitalization, the role of FDI remains as important as during the initial wave. In the Broadcasting Sector, the 2013 FDI Policy has raised the FDI cap to 74% for Direct to Home services and Cable Networks (Multi System operators (MSOs) operating at National or State or District level and undertaking Upgradation of networks towards digitalization and addressability. Investment up to 49% will be allowed in the automatic route whereas for investment beyond 49%, approval of the government will be required. Content Production 100 % (FIPB) Up-linking a Non-news & Current Affairs TV Channel 100 % (FIPB) (for their entertainment content) Up-linking a News & Current affairs TV channel 26% (FIPB) (FDI+(FII) (for their news channel) Down linking of TV channel 100 % (FIPB) DTH 49% (FIPB) (FDI+FII) (FDI will not exceed 20%) Cable 49% (FIPB) (FDI+FII) HITS 74% (FIPB) (FDI+FII) Content Production Broadcasting TV Distribution Source: Industry Estimates
  • 17. P a g e | 17 With respect to foreign investment in the broadcasting services, the Government has introduced several security conditions and terms including: i) Mandatory requirements for key executives of the Company, ii) Security clearance of personnel, iii) requirements related to infrastructure, network and software’s, iv) monitoring, inspection and submission of information, and v) National Security Conditions. A New Era of Possibilities Beyond Triple Play Cable operators are no longer seen as just the “cable guys”. They have built a world-class reputation as reliable multi-service-operators (MSOs). The development of modern hybrid fiber-coaxial (HFC) networks has enabled cable operators to rapidly respond to residential customers varied demands, from state-of- the-art HDTV to video on demand and high-speed internet access. But the MSOs world should not and indeed does not end here. More Than Residential MSOs now have access to much wider market opportunities and are well-positioned to compete with traditional Telcos for business Ethernet and mobile backhaul services. As MSOs continue to increase their network capacity and drive fiber closer to their customers, their competitive landscape rapidly broadens. Strengths & Weakness of Various TV Distribution Channels Strengths Weakness Analogue Cable  No further special infrastructure requirement  Limited capacity to carry channels  Poor picture quality  Lack of addressability  No interactive services Digital Cable  High capacity to carry channels  Voice and Data Carrying Capability  Possibility of Interactivity  Good picture quality  High cost of infrastructure  Placement of CPE  High cost of laying new cable/fiber to reach subscriber (if required) DTH  Enhanced picture quality  Bypass the constraints of terrestrial transmission  Last mile connectivity directly to the home of the subscriber through satellite  Lack of return path  High Cost of start-up infrastructure  Placement of CPE  Effect of weather on transmission
  • 18. P a g e | 18 The Way Forward The cable sector is emerging as a very attractive space owing to the TRAI recommendations and the clear edge of digital cable over its competition like DTH and IPTV. The difference lies in offering a larger number of channels, greater reliability even in adverse weather conditions and easier access to cheaper after-sales and customer services. Globally, India is the third largest player in the cable TV space. Even though DTH Technology is emerging as a competition to Cable in India, globally Cable has been resilient to such technologies and even in developed countries like US; Cable has a 70% market share within In-home Entertainment. Industry experts expect cable TV industry to consolidate and corporatize in the near future, this will lead to economies of scale, higher efficiency and also easier access to capital. Television industry in India is on a transformation path. Multiple channels in each genre competing with each other for TRP, increasing pay TV penetration, expanding yet fragmented local as well as overseas viewership of Indian channels, demand for more specific content has clearly set the stage for the next level of growth and transition for players across the television value chain. The government's mandate to digitize cable networks will bring a significant transformation to the TV industry and positively impact broadband penetration. Ministry of Information and Broadcasting and TRAI have been taking care of issues in this sector. Not addressing crucial issues confronting this sector and the absence of an independent authority to oversee it could take digitization off-track. There is an urgent need for the government to work with the ecosystem and create a solution to address these challenges. The cable MSO digital penetration today stands at 5 million. To meet the deadline of 2014, cable service providers have to sell about 90 million set-top boxes to their consumers. While complete digitization may or may not happen within the given timeframe, even ensuring a 60-percent digitization will enable India move a step forward to be on par with the developed economies in the sector. India’s M&E industry is expected to get double in size to Rs.1.66 trillion (US$ 28.72 billion) by 2017, from Rs.82, 000 crore (US$ 14.19 billion) in 2012, which would be a compounded annual growth rate (CAGR) of 15.2 per cent, according to the Indian Media and Entertainment Industry Report 2013 by KPMG with an industry body..
  • 19. P a g e | 19 Acknowledgements This paper would not have been possible without the commitment and contribution of the following individuals. Durga Prasad Key Accounts Manager OSS/BSS Solutions Diksha Technologies Malcolm Santosh Kumar Research Analyst Diksha Technologies
  • 20. Singapore About Diksha Technologies Diksha Technologies is a professional services and product development organization catering to IT and telecom companies for over 13 years. With offices in India, USA, Australia and Singapore we are currently servicing major SI’s and Telcos across the globe. With a strong team on OSS/BSS, CRM & Enterprise Solutions, Diksha is one of the strongest telecom technology service providers in the telecom services market. The Diksha stack of products is developed with Diksha’s expertise in telecom consulting. These products are easing-off day-to-day challenges faced by companies operating in an environment which requires billing engines to charge their end customers. Considering this focus of products, the intended customers for Diksha Products would be the Telecom Operators and Consulting Companies across the globe along with the Banking and Financial Services sector, due to their need of billing technology in operations. 5 th Floor, JP Square, #190, Sankey Road, Sadashiv Nagar Bangalore - 560 052, Karnataka Phone: +91 80 4333 6222 Fax: +91 80 4333 6245 401/14 Shoreline Drive, Rhodes, NSW 2138 Phone+61451045975 3223, Route 38, Suite 202, Mount Laurel New Jersey 08054, USA Voice: 856-206-0472 No. 120, Telok Ayer Street, Singapore (068589) Phone: +65 62426533 Level 15, 215, Lambton Quay, Wellington Central, Wellington- 6011 Phone: +644 9203070 New Zealand USA Australia Corporate Office - India www.dikshatech.com https://www.facebook.com/Diksha.Technologies https://twitter.com/DikshaTech

×