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Foreign experts sceptical of India's cable TV plans
Manoranjana Gupta
NEW DELHI
While half a dozen major Indian industrial houses are trumpeting their plans running into several
thousand crores to launch satellite TV channels, industry analysts warn that the entire investment
stands the risk of coming to nought in the absence of a high-tech and well entrenched cable television
network.
Several leading television and cable TV industry executives have voiced deep concern that India may be
“jumping the gun by being exposed to tens of (satellite) TV channels as early as next year”.
They caution that private and public money invested in the channels could well be lost unless India
develops a “technologically modern cable network that is no longer a maze of cable strung over roof-tops”.
Taking into account the announced plans of groups such as RPG, Hindujas, Zee, Times TV and of
thousands of other medium to small cable TV enterprises, experts calculate that nearly $300 million is
expected to be spent on setting up and expanding their cable TV networks in the next two years. And,
“more than half of this money would be worth nothing, just when they have finished spending it”.
Foreign media giants eyeing the expanding and lucrative Indi cable TV market admit that “while it is an
exciting opportunity, it is also a formidable challenge”. They agree with the experts and market analysts
that India requires “a serious investment that could well surpass the planned $300 million” but are
cautious to add that they “would not spend it the way the (indian) industry has so far planned to spend
it”.
Experts, who have conducted a comprehensive study of the Indian cable TV industry over the past year,
say that “bringing the Indian cable TV industry to where it can carry 20 to 30 channels to 10 million
homes with clean and clear signals...and provide a standardised network whereby the TV channels can
benefit from both viewership and thus advertising (money) ...will take at least three and up to perhaps as
many as five years”.
As of date, India boasts “rather quickly, and quite stupendously, a cable TV network connecting nearly 16
million homes in the country”, say experts, adding, “India’s (cable TV) industry could be a Guinness
record, having developed at the fastest rate” in a span of three-and-a-half years.
It is estimated that India would have at least 40 million cable TV homes by 1997-end, even sooner, going
by the present trend. Today, India has approximately 45 million TV homes. The number is expected to go
up to between 65 and 70 million by 1997-end.
Also, experts predict that if major multinationals ate able to tie up with Indian companies by early 1995
to upgrade cable TV technology and help “wire-up the country”, India “could actually have a near-US-like
cable TV network”.
By using, for example, the state-of-the-art fibre optic cable for trunk-line connections and distribution;
India could see the introduction of “cable and telephony within the next two years over the cable TV
network”.
This would imply that not only would consumers be able to watch free-to-air TV channels, whether
broadcast or satellite, but order home entertainment audio visuals on a pay-per-view basis (order and pay
for each order), but also be connected to on-line computer and shopping services and receive/send phone
and fax over the same lines.
However, all Indian giants vying for the cable TV market seem to have not planned for the massive
technological ‘input and comprehensive planning their projects would require despite their ambitious
plans.
While some Indian industrial houses such as the RPG group have announced plans to use Calcutta’s
existing fibre optic telecommunications lines for their cable TV network, it has not put forth any clear
plans.
It is hazy, to say the least, whether the group’s planned network would tap into the city’s fibre optic lines
which could prove harmful to the telecommunications service unless specifically designed with long-term
goals and scope for both upgradation and rectification, or whether the RPG group would lay its own fibre
optic cable.
Another major entrant, the Hinduja group’s plans have already shaped up into more than a dozen cable
TV head- ends that have sprung up in Bombay and Delhi which totally ignore the fact that India should
be deploying new technology fibre-optics and not the equipment which is fast becoming obsolete.
Foreign cable TV executives and experts say that India has already “leap-frogged into deploying and using
21st century technology” in the multi-faceted telecommunication networks being set up by multinationals
like AT&T, US West and even Indian companies and the government’s own VSNL and MTNL.
It is unimaginable then that “parallel (telecommunications) networks, like cable TV, should use
technology from the seventies and eighties.
Experts point out that “unless checked right away, in less than three years India could only boast of an
unruly mesh of primitive coaxial cable TV wires which, if piled up, could stand taller than Mt. Everest”.
Experts further quantify this foreseeable calamity by likening it to the problem of underground metro
transport systems faced in Indian cities which ultimately had to contend with the existing polluted and
over-crowded surface transport network.
India could thus face a scenario in which even by the turn of the century the desired combination of
interactive audio and audio visual offerings through a modern telecommunications network could remain
a distant dream.
Taking a short-term view of India’s emerging cable TV industry, foreign experts say that private and
public money being raised to fund the fledgling networks may be wasted unless the present plans are
sharpened with long-term strategic planning.
They suggest that any prudent plans should take into account “the interests of the country’s overall
technological development which is the only way for this (emerging) industry to guarantee its business”.
Most foreign cable TV networks feel that some Indian groups may be “better informed than others”, but
none of the groups have “a comprehensive plan” that envisions setting up a multi-faceted business as
being chalked out by today’s telecommunications! cable TV networks around the world, including in
developing countries.
Observers generally agree that Indian groups may be overanxious in their desire to be among the first to
capture the market a desire stemming from the astounding success of STAR TV, ZEE TV, and the now
recognised Indian cable TV franchises which have all churned out a net present value which is 10 times
the original investment. within three to four years.