Amit Khanna: Big time for small screen

FREEZE FRAME/ The television industry faces exciting times

Is the Indian cable and satellite (C&S) industry booming in spite of the conditional access system (CAS) effect? It would seem so if you were to look at the number of new channels that have been launched or are about to be aired soon.

Actually, the industry isn't quite booming as yet but these are exciting times for broadcasters. Irrespective of delays, a regulated, addressable (CAS) regime will take over in India.

The huge, growing market "� 1.1 billion people, over 100 million TV households "� is bound to make any marketer salivate. Yet large foreign networks to local cable channels have all discovered the gap between the potential and the real audience and done so rather expensively.

India, as has often been said, is not one homogenous market . Media and entertainment purveyors have to also watch out for ethnocentricity and cultural specificity.

There is literally no pan-Indian entertainment with the exception of cricket. Yes, like the big screen, the small one too has Hindi as the dominant linguistic preference.

Here again, like Bollywood potboilers, there is very little differentiation between one hit and another. The look and feel, the technique, keep on improving but the stories are repeated with cyclical periodicity. The actors, news anchors, even the panellists, keep coming back like bad 10 paisa coins.

We have seen about a dozen new channels being launched in the last few months and an equal number are about to begin transmission in the coming months. The preferred genres of the season are news channels, children's channels, new age living or spiritual channels and esoteric foreign channels.

One obvious reason for this expansion is the desire of networks to create a bouquet of channels. The second is that while entry barriers for mainstream channels have become fairly steep, you can start your very own channel at a very low cost, thanks to technology.

India has six major TV networks; Doordarshan, Star, Sony, Zee, Sun and Enadu. Sony has a distribution alliance with Discovery and distributes the NDTV and Viacom (MTV) and HBO channels. Zee has a tie up with Turner and distributes MGM, among other channels. Star distributes the National Geographic and History channels.

Doordarshan, of course, has one of the largest terrestrial networks in the world and is about to start its Direct-to-Home (DTH) service. Zee already has a fledgling DTH service "� Dish TV. Star along with the Tatas will begin their DTH operations around Diwali. Then there are the new emerging technologies of broadband which will create alternate delivery platforms in the not too distant a future.

All this is triggering off a race for creating smorgasbords of appetising content for diverse audiences. While the rag tag legislation on addressibility talks of interoperability of set-top boxes, the fact is that most consumers can ill afford more than one service.

So with 30-odd free-to-air channels, most platforms will try to capture at least 30 other strong pay channels. To satisfy the disparate customer profile, it is becoming imperative for all these platforms to fill the gaps in their programming.

That is why more news channels, more film channels, more kids channels, more spiritual channels, more all other channels are being launched. Cricket, films, soaps, cartoons, music and news are a must-have for all platforms. Little wonder, then, that the players are scrambling to grab a share of these.

The next fight will be to get language channels in the package .You can expect some new alliances to be forged soon. The dynamics of the C&S market are such that with a 50 per cent under declaration, subscription revenue alone has enormous potential.

Add to this an increasing advertising pie and you are talking of a Rs 15,000 crore business growing by over 15 per cent per annum. This makes India one of the largest and fastest growing markets for broadcasting in the world.

This is the reason that all the international majors want to expand their presence in India and all Indian players are trying to broaden their offerings. Even private equity investors and venture capitalists are willing to lend to this sector. As it is we have had two major media IPOs. Another half a dozen are in the pipeline.

There are some hazy spots in this otherwise colourful picture. The regulatory environment is still messy. A turf battle is already brewing between the ministry of communications and the ministry of information and broadcasting.

The interim regulator, the Telecom Regulatory Authority of India, is making its own noises. What almost all the stakeholders are forgetting is that technology ruthlessly marches on. Unless legislation and businesses keep pace with technological change, they are trampled upon.

Convergence is inevitable in the digital world. Broadband delivered through whichever technology in the last mile will eventually lead to the dismantling of linear channel-driven viewing. What will come in its place is time shifting, on-demand and pay per view.

All this will ultimately benefit the consumer who will have more choice at affordable prices. Meanwhile, viewers will continue to see new programmes, new channels and even new access modes. Yet in the end it is the innovative who will survive and the really differentiated who will thrive.

Whatever the platform, whatever the device and whatever the programme, the remote will still remain in the viewer's hand. And there will always be 24 hours in a day. How much of any kind of TV can you watch in 24 hours anywhere, anyhow?

(Amit Khanna is chairman of Reliance Entertainment. The views expressed here are his own)