India's cable tigers and digital
dragons By Raja M
MUMBAI -
"Let market forces rule," urged Michelle Guthrie, chief
executive officer of Hong Kong-based Star TV during a
recent visit to Mumbai, voicing the anxieties of
satellite television and telecom titans battling
government regulators in India and China.
By
2007, market soothsayers predict India will have 61
million pay TV subscriber households, second only to
China's 113 million. Inevitably, media giants from News
Corp to the new variant Liberty Media International are
eyeing India with great interest. A quiet, if not
pliant, referee makes them drool.
The stakes are
high. Mukesh Ambani, chairman and managing director of
Reliance Industries, one of the big boys in Indian
television, predicts the Indian media and entertainment
industry will boom from US$2 billion to $200 billion in
the next 20 years. Reliance announced plans to earn a
fair chunk of that booty with its broadband initiative,
dubbed "Broadband Bharat", which is nearly ready to go
and will reach 1,100 Indian towns and cities through
80,000 kilometers of fibre optic cable.
The gap
in such chains is the last mile, the customer, and that
could be the proverbial slip between cup and lip.
Looming in between are contentious issues like the
conditional access system, government regulated
subscription billing, a set-top box experiment that
flopped in Chennai and New Delhi and the
monopoly-enjoying, mafia-dominated cable operator tribe
that is as much loved and respected all around as a
community of clever crooks.
More indigestible
masala comes from governmental muscle flexing. For
instance, the government TV network Prasar Bharati
successfully sought court intervention to force the
Dubai-based Ten Sports channel to share its exclusive
live feed of the India Pakistan cricket "Friendship"
series this month. "Public interest" was the remarkable
excuse touted for the public broadcaster to pinch rights
from a private company for a sports telecast.
Making reassuring noises, the newly appointed
regulator for Indian television and broadcast media, the
Telecom Regulatory Authority of India, TRAI, promised a
better regulatory framework for the cable TV industry in
next two or three months.
Likewise, the Chinese
government, too, has woke up to the realities of cable
TV. The State Administration of Radio, Film and
Television has announced new regulations to allow
foreign media firms to hold minority stakes in joint
venture production companies. Local private companies
can also develop pay channels and digital services. The
Chinese, as ominously pointed out during a recent media
conference, do not enter a race until they are sure they
can win it.
"In the regional context, India and
China already account for over a third of the total
Asia-Pacific industry value [including Japan], and this
share will only increase," says Peter Read, director at
Fusion Consulting, a business intelligence consultancy
in Singapore and Hong Kong. "India's pay TV market is
more significant to the national economy than China's.
Both sectors were worth about $3 to 4 billion in 2003,
which equates to about 1 percent of India's economy but
just 0.25 percent of China's."
Read told Asia
Times Online that the same difference applied in terms
of the national psyche too. "Thanks largely to local
sitcoms, Bollywood and cricket, pay TV is far more
top-of-mind for the average person in India than it is
in China."
But that equation could quickly
change. "Today, there is not much of a pay TV industry
to speak of in China, " Guthrie of Star said, "But
remember that 10 years ago there was no pay TV industry
in India." Guthrie is a regional governor in the
emerging new digital empires of the TV-tuned mind. She
already influences what 300 million viewers watch in 53
countries.
Impacts from such cultural invasions
into millions of Asian households obviously go beyond
mere business implications. More Indian households have
cable TV than have telephones, with 55 million cable
homes and 43 million telephone lines. From changing
social attitudes to leveraging political power, Indian
TV channels grow in influence and throw out a new stream
of national figures like intrepid television journalist
Burkha Dutt.
More Indians are following the
current general election campaign through TV debates in
news channels than through the traditional dusty street
corner tamashas or raucous public meetings. On
Sunday, a leading national daily reported that India's
political honchos are taking English language classes
and calling public relations consultants on what to wear
and how to look better on TV. Such add-on influences
could leap over the consumer utilities that dominate
digital TV in Western countries. Media baron Rupert
Murdoch's four-year-old Sky Digital in the United
Kingdom offers interactive services letting viewers
e-mail, manage finances, check bank statements, book
movie tickets, shop, play games and chose camera angles
in sports grounds. Digital TV could make voting in
general elections by sitting at home a possibility for
India. That means the upper middle class, generally the
most politically inactive section, could find new
empowerment.
"As the digital infrastructure gets
built, a process of creative destruction and
reconstruction will take place," says Rajesh Jain, one
India's Internet pioneers. In his weblog on Emerging
Technologies, Enterprises and Markets, Jain writes: "In
India, there are great disparities in the quality of
education imparted across institutions in urban,
semi-urban and rural India. The availability of low-cost
computers and high-speed networks can completely
transform education through its value chain - from
content creation, translation, delivery and facilitating
teacher-student interaction."
Evolving
technologies and mindsets will quicken such digital
"creative destruction and reconstruction'". In April,
Sharp will release the Aquos LC-15L1U, the world's first
wireless flat-panel television. But a more pertinent
question facing the future than wireless technology is
how much time and craving an evolving species will have
for entertainment. An intelligent society will value
time as its most precious commodity, and it's hard to
imagine young Asian women of 2025 glued to the
mother-in-law vs daughter-in-law brands of soaps Indian
TV producers are now frantically churning out.
But in a short-attention span afflicted TV
world, the more immediate worry is people watching fewer
advertisements. Personal Video Recorders (PVRs) like
TiVo can block ads and upset the economics of the
business. "Anecdotal evidence suggests PVRs rips out 30
percent of the ad audience," Adam Smith, head of
publications of the London-based global media services
giant Zenith Optimedia Group, told Asia Times Online.
"And as PVRs are the preserve of the rich, this is the
30 percent you least want to lose." Zenith Optimedia is
one of the top five media spenders in the world, with an
estimated $18 billion in billings. Some more food for
thought for emerging cable tigers and digital dragons.
Raja M is an independent writer based
in Mumbai, India.
(Copyright 2004 Asia Times
Online Ltd. All rights reserved. Please contact content@atimes.com for
information on our sales and syndication policies.)
