labels: entertainment, telecom
CAS, cash or crash?news
Sajeev Nair
12 November 2003

The television and cable industry is yet to accept the defeat of the CAS rollout. In fact, plans are afoot for a re-rollout - this time with pride and splendour

Mumbai: "The customers have rejected the conditional access system (CAS) in India." This admission by the strongest advocators of the regime springs little or no surprise, as both the government and the industry were aware of the lacklustre attitude by cable and TV viewers against the implementation of CAS.

What is CAS and what is the need?
CAS is a method that allows users to control and secure access to electronically transmitted services and contents, as well as to determine the conditions under which access is granted. Broadcasters and multi-system operators (MSO) allege that cable operators are understating the actual amount of customers they have, and, in turn, robbing them of a large chunk of revenues. Moreover, the industry is also of the opinion that a large number of channels are "dumped" on the user, who does not necessarily be watching many of these channels.

Viewers will have to install a receiver, or a decorder, called set-top-box (STB). An STB will have a smart card, which will enable the viewer to watch only the channels of his choice. In simple terms, a viewer will be able watch only the channels for which he pays for. However, the customer could also access all free-to-air (FTA) channels through the cable operator.

Legalising and disciplining the entire industry, apart from garnering revenues that MSOs and broadcasters "rightly own," is one of the reasons behind the implementation of CAS. CAS, according to the industry, is beneficial to all the parties concerned - the viewers, the industry and the government.

What went wrong?
Sony Entertainment Television CEO Kunal Dasgupta says misinformation had played a major role in keeping its implementation at bay. "The cost of an STB was one of the major impediments; a phobia among viewers that cable operators might hike rent at their discretion also posed a hurdle."

To an average viewer, to whom a television set had already cost a bomb, forking out Rs 4,000 to Rs 5,000 for an entry level STB is an additional burden. Shelling out around Rs 10,000 to Rs 20,000 for a higher-level STB is a strict "no-no," a reason why the customer wants to delay CAS as long as possible, feel industry sources.

Though the price tag will include installation charges and the cost of a smart card, which ensures that viewers are billed only for the channels they watch, the initial financial burden deters a viewer from acquiring an STB.

The prices of STBs, which viewers believe are on the higher side, will make TV viewing an expensive affair. However, the prices might not fall in the near future, given the fact the most of the boxes are being imported and there are no major STB manufacturers in India, says Philip George, an industry watcher.

Moreover, in certain metros like Chennai, only high-end digital STBs are available, which cost much more than their analogue cousins. The shopkeepers were only interested in selling high-end varieties as most of them are paid a percentage of the prices, which is higher in case of digital STBs. "The higher the price, the higher the profit," says a shopkeeper in Chennai, admitting that his ilk does not encourage analogue STB seekers.

With the riptide of technology advancing at a mind-boggling pace, analogue versions might become obsolete as most of the operators are expected to shift over to digital technology, and digital STBs will be the best buy, they justify. The digital STBs also enable services like interactive TV, Internet access and gaming, says M Masood, an electronic goods dealer in downtown Mumbai.

A fear that if an STB is purchased, the viewer might fall prey to an irrational price hike, depending on the whims and fancies of the MSO or cable operator, had also resulted in delaying the CAS rollout. But industry sources say the fear is unfounded, as prices will be the same all across the country, and any change might occur in consensus with the government, industry and other bodies.

Most of the popular regional channels going on air on an FTA basis and a "fear and disinterest" among operators also derailed the process, feels an analyst. But, according to Ram Hingorani, chairman, Indusind Media & Communications, a "non-cooperation among certain broadcasters and operators also led to the delay in the implementation of CAS. A lack of unified messaging and marketing was also a reason for the failure of CAS."

What next?
Nevertheless, the industry - consisting of cable operators, MSOs and television firms - is yet to admit defeat, and on the contrary, is planning for a re-rollout of CAS. This will happen after gaining the confidence of the customers, educating and assisting them in attaining financial assistance.

Many banks, including ICICI Bank, have expressed interest in offering financial assistance to customers for purchasing STBs, either by way of personal loans or under higher purchase schemes. Moreover, with certain banks also planning to tie up with MSOs for providing financial assistance for STBs, buying an access box will not be that difficult, says industry sources.

MSOs and cable operators are also planning to offer STBs bundled on a rental basis to households. This will help in ensuring that the initial expense of buying an STB, which seems to be a biggest deterrent of CAS, is spread over one or two years. The monthly burden on the consumer will be contained between Rs 150 and Rs 400, depending on the time frame of the financing plan, says an analyst.

The operators are also planning to offer localised services and move from sheer broadcast to interactive mode, says Dasgupta. "Addressability, the only way the industry can march ahead, will prove to be the cornerstone of the entire growth of the home entertainment sector." The MSOs and cable operators, along with the industry and government, should start an awareness drive before implementing CAS, says Hingorani.

Viewers' game plan
According to industry experts and analysts, viewers are opting for a "wait-and-watch" approach, to see how CAS implementation pans out. The rollout of newer technologies like DTH and interactive TV is also slated to make the present STBs obsolete.

Telecom majors like Reliance Infocomm, Bharti Televentures and the Tatas are planning to offer DTH and digital subscriber lines (DSL) through broadband, which are slated to revolutionise TV viewing in India. Most of these technologies will use optical fibre cable (OFC), rather than the conventional method of using co-axial cables, which might redefine TV viewing in the country.

Reliance Entertainment chairman Amit Khanna says India is moving into a digital value chain. "We will have an over-arching digital infrastructure in the next three to five years."

These technologies, as they pan out, might or might not use STBs, which only time will tell. Though it might be a delayed decision, the viewer's decision, as always, is the right one. The customer is the king, even in the digital world.

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CAS, cash or crash?