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Tuesday, Aug 17, 2004

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Cable TV viewers may have to shell out more

K.V. Kurmanath

The levy of 10 per cent service tax and two per cent education cess introduced in the Budget are the latest bones of contention.

Hyderabad , Aug. 16

BAD news for cable TV viewers. It's not just the countrywide strike by some cable operators from Tuesday, which could result in the telecast of all but four channels. The monthly subscription charges are likely to go up by Rs 50-Rs 75 from next month.

The levy of 10 per cent service tax and two per cent education cess introduced in the Budget are the latest reasons cited by the cable operators for the proposed hike.

"It is no more viable to offer services at the prevailing rates," Mr Prabhakar Reddy, President of AP Cable Operators Welfare Association, told Business Line.

He said the association was working on different pricing structures for urban and rural viewers.

Mr Reddy regretted that there was no proper policy guiding the cable industry. "The right figures are not available with regard to viewership of different channels," he said. Admitting that the operators did well in the initial days, Mr Reddy said it's no cakewalk running the networks now.

"We did well in the early nineties when there were only five channels. But then the number is multiplying every year. As the number grew, the number of pay channels too grew rapidly," he said.

Meanwhile, the All-India Cable TV Forum demanded that the Government withdraw service tax slapped on the industry.

The forum comprises top Multi Service Operators and cable TV operators such as Siti Cable, Hathway, RPG and Trinity.

In a statement, the forum alleged that service tax has forced cable operators to increase the subscription rate .

The tax would put extra burden on public. Mr K. Srinivasa Rao, General Secretary of AP Cable Operators Welfare Association, said it had become increasingly difficult for operators to keep pace with the increasing costs.

"The top three bouquets are charging Rs 55 a connection. Even some Telugu channels have turned pay . We are made to cough up Rs 200. It will be difficult unless we hike the subscription rate," he said.

However, Cable Operators' Federation of India (COFI) alleged that there were some vested interests behind the strike. "They are striking because they have ground level operations. Independent operators are not part of the strike," a COFI functionary felt.

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