NEW DELHI: Zee Telefilms has always loved to set the cat amongst the pigeons. Over two years back, when conditional access was a relatively unknown word, Zee Telefilms CMD Subhash Chandra had supported it, much to the chagrin of the likes of Star and Sony.
At a time when the annual hike in subscription rates of TV channels (under the watchful eyes of the sector regulator) draws near, Siti Cable is attempting to educate its franchisee cable ops that new channels would mean a substantial hike for MSOs, which would have to be passed down to the operators.
Citing the examples of Zoom, Star One, Hungama, MTV, Nick, etc., Siti Cable in an invitation to its franchisees or joint venture partners has said that the total financial impact of these new pay channels, launched in the last few months, is about Rs 70 (approximately $ 1.6) per month.
"Availing these channels entails the realisation of extra amount from subscribers to the extent of their prices," Siti cable has conveyed to its franchisees, urging them to come together to discuss various such issues. The first of this proposed series is being flagged off in Delhi today.
The invitation, signed by a senior Siti executive, Tapas Roy, also points to the fact that in the "absence of realisation of these additional amounts from the ground," the industry, already reeling under severe operating losses, would further bleed.
What is slightly worrisome is that Siti and other MSOs have stated in private that though new TV channels were being priced individually, broadcasters have been allegedly insisting the cable industry enter into subscription agreements as a part of their existing bouquet itself, based on prevailing connectivity irrespective of the fact whether these new channels were being subscribed by customers or not.
Other issues that are slated to be discussed in today's cable ops meet, organised by Siti Cable, include that relating to the service tax @ 10.02 per cent and the draft interconnection regulation issued by the Telecom Regulatory Authority of India (Trai).
According to Siti Cable, cable ops need to pay service tax to the MSO (in this case Siti Cable) on the bills raised on them by Siti. However, the cable ops can claim credit of the service tax so paid to the MSO and, in turn, pay the government the balance tax after setting off the amount paid to the MSO.
In other words, cable ops need to pay only the net service tax to the government and as such it is not double taxation as is being misunderstood in various circles, Siti has said.
But it seems this education campaign's success would depend on the fact how the Delhi meet shapes up.
