The Hindu Business Line : CAS: The fading picture

The script is all muddled for the Conditional Access System. Instead of rushing to implement an ill-conceived system, the Government could have waited for the enactment of the Convergence Bill, which envisages a super-regulator that could have resolved disputes among different sections of the television industry. Having acted in haste, the Government is repenting at leisure, says Paranjoy Guha Thakurta.

HAVING failed miserably in implementing a conditional access system (CAS) for cable television viewers in south Delhi after Chennai, the Union Ministry of Information and Broadcasting is reportedly thinking of scrapping the system altogether by promulgating an ordinance.

The Ministry is now planning to set up an interim regulator for the television industry, a move it should have thought of a long time ago.

All the problems the Government encountered in its ham-handed attempts to implement CAS could — and should — have been anticipated. But it refused to see reason and went ahead trying to implement a flawed and ill-conceived system that was meant to favour consumers but actually did not.

CAS was supposed to provide greater choice to viewers and was also intended to bring about a semblance of order in an anarchic industry. What happened instead was that the fissures among different sections of the industry got exposed.

These sections are (a) the last-mile operators (LMOs) or local cable television providers who monopolise distribution to the consumer in specific neighbourhoods; (b) the wholesale distributors or multi-system operators (MSOs) who also run their own monopolies and some of whom are associated with large broadcasters like Zee, STAR and Sun; (c) the broadcasters, especially the private ones running pay channels; (d) the advertisers, the advertising and media-buying agencies; and, of course, (e) the government.

Other segments in the industry, including software producers, have played only a peripheral role in the CAS imbroglio but have nevertheless been adversely affected by the prevailing confusion.

In December 2002, the Cable Television Networks (Regulation) Act was enacted when Ms Sushma Swaraj was I&B Minister. She eloquently argued in Parliament how CAS would be consumer-friendly.

She was succeeded by Mr Ravi Shankar Prasad, who set deadlines that had to be postponed. Then he talked of implementing the system in metros in a phased manner.

Even these plans went awry ostensibly because Assembly elections took place in the National Capital Region and the Union Government did not want to antagonise middle-class voters; not that it helped the ruling coalition very much.

Mr Prasad is now playing the role of a helpless spectator, still contemplating the need for instituting a neutral umpire while different groups in the industry slug it out. Curiously, the MSOs and the LMOs are today more keen than the Government to get CAS going.

This is simply because these two sections have invested substantial amounts in purchasing set-top boxes — many of them imported from companies that are part of Rupert Murdoch's media empire — and want to recover their money.

What is often forgotten is the fact that in most developed countries where CAS is in place, subscribers have had to pay nothing or next to nothing for having set-top boxes installed on their television sets.

Last year, when the MSOs, the LMOs and the broadcasters were at one another's throats, the I&B Ministry had contemplated an ordinance to rein in recalcitrant broadcasters who were refusing to bring down the rates of pay channels.

Many of Mr Prasad's Cabinet colleagues, however, opposed the promulgation of such an ordinance as it would have been perceived as an attempt to curb the media's freedom of expresion.

It is still a mystery why the Government wanted to control the activities of broadcasters in the first place unless one believes in the theory that there are some in the ruling coalition who were dissatisfied with the television coverage of the communal riots in Gujarat.

The fine-print of the amended law (Section 4) provides the Union Government over-riding powers in the name of protecting "public interest" to control which channel is watched where and when, whether on payment of a fee or for free. One ridiculous aspect of the amended law is that it has been made mandatory for all cable operators to submit regular reports to the I&B Ministry about the number of subscribers, the number of pay and free-to-air channels provided, besides the price charged to consumers for each and every channel.

Given the fact that there are some 30,000 LMOs in the country, if CAS is actually implemented all over India, one can only guess the number of forms that would flow into Shastri Bhavan.

This provision of the law is ludicrous as everybody and his brother are talking about downsizing the bureaucracy.

Not very long ago, an official committee headed by the former Finance Secretary, Mr K. P. Geethakrishnan, had recommended that the I&B Ministry itself be drastically divested of many of its divisions and departments.

The Delhi High Court has ruled that subscribers cannot be forced to pay for a bouquet of channels instead of a particular one.

Still, the manner in which the price of a flagship channel has been fixed to account for the bulk of the cost of receiving a bouquet of channels could be construed as a restrictive trade practice. After a meeting with the Delhi Chief Minister, Ms Sheila Dixit, Mr Prasad had stated that a consumer court would be set up to deal with disputes because subscribers in Delhi who have purchased set-top boxes are complaining that they are paying more than what they did in the past and for receiving fewer channels too.

They are also cribbing that set-top boxes are arbitrarily priced and that cable operators are not providing all the free-to-air channels they are supposed to.

The most important reason why the implementation of CAS has proved so difficult is on account of the fact that a transparent system would drastically curb corruption — something that nobody in India seems to want.

This is the only country where a subscriber receives anywhere between 30 and 100 channels for the equivalent of $ 4-6 a month.

LMOs typically declare 15-20 per cent of the actual number of subscribers they have because they can then pay that much less to the MSOs as well as broadcasters and are at the same time, able to keep subscriber charges low, that is, between Rs 150 and Rs 400 per month. Broadcasters too make tall claims about reach and viewership that are not always accurate or verifiable.

The fact is that there are just about 5,000 "people meters" to ascertain TRPs (television rating points) or TAM (television audience measurement) figures in a country that has close to 45 million television sets (out of a total of nearly 90 million sets) with cable and satellite connections. On the basis of these questionable TRP/TAM statistics, at the behest of advertising and media buying agencies, advertisers end up spending huge sums of money (to the tune of Rs 5,000 crore per year) to buy airtime on television channels.

sLMOs complain that broadcasters keep hiking rates, which is correct. Broadcasters, in turn, complain that cable operators do not tell them the exact number of subscribers they have, which is also true.

The LMOs are unwilling to provide a proper receipt to their subscribers or give up their monopoly because that would mean improving the quality of service.

And so the blame game goes on. Before trying to rush through with CAS, the Government could have waited for the enactment of the Convergence Bill that has been pending before a committee of MPs since the 2001 winter session of Parliament.

This Bill envisages the appointment of a super-regulatory body called the Communications Commission of India — along the lines of the Federal Communications Commission of the US — that could have resolved disputes among different sections of the television industry. Having acted in haste, the Government is repenting at leisure.

(The author is Director, School of Convergence, International Management Institute, New Delhi, and a journalist with over 25 years of experience in various media — print, Internet, radio and television. He can be contacted at paranjoy@yahoo.com.)

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