Cable television services in towns and cities across the country will go completely digital in the next three years, the government said on Thursday. The cabinet committee of economic affairs has cleared a proposal for digitisation of cable services in all metros by 2012 and other urban areas by 2014, information and broadcasting (I&B) minister Ambika Soni said.
At present, while there are several direct-to-home and multi-system operators in the urban areas, analog systems also abound, leading to issues of transparency and control.
The ordinance will allow the I&B ministry to insert a clause in section 4A of Cable Act, thereby making a digital addressable system mandatory in the cable sector. This will have to be done in four phases as recommended by the I&B ministry and the Telecom Regulatory Authority of India.
"Cable operators will have to abandon analog in the four metros by March 31, 2012. Cities with a population of one million will be covered by March 31, 2013. All urban areas would be covered by September 30, 2014. The entire country will be covered by December 31, 2014," said Soni.
The ordinance will now pass through the law ministry to the president for a final signature, post which it would be ratified by Parliament within six months.
The cable and satellite television industry has hailed the initiative as a game-changer.
Mandatory digitisation is expected to reduce revenue leakage in the system where the level of under-declaration of subscribers and revenues is said to be as high as 80%. With compulsory digitisation, errant operators can no longer fake the numbers.
Experts feel the initiative is a win-win across the value chain. Cable operators benefit as capacity constraints are removed and they are able to offer more channels by going digital, thereby boosting subscription revenues.
Additionally, they get to offer a host of value added services such as movie-on-demand, electronic programming guide, internet and high-definition channels as additional revenue streams.
For the broadcasters, on the other hand, the initiative means a reduction in the carriage fees they need to pay cable operators to ensure their channels are beamed in a certain locality.
As for the end-consumer, there is an assurance of greater variety and better quality of content. Indeed, it is likely there would be an explosion of channels as even niche plays become viable.
