TV.NXT 2014: Digitisation - a glass half-full or half-empty?

The topic that has kept the television industry on its toes for the past few years also made a big impact in TV.NXT 2014. On Day Two of the event, an eminent panel sat down to discuss and debate whether digitization has gone the way it was planned, whether there is any way to rectify the mistakes or are we, as some people fear, really at the point of no return.

Vynsley Fernandes, director, Castle Media, anchored the debate. Speaking on the topic were Tony D'Silva, CEO, media vertical, Hinduja Group; Rahul Johri, executive vice president and general manager, South Asia, & Head of Revenues, Pan-Regional ad sales, Southeast Asia, Discovery Networks Asia-Pacific; Siddharth Jain, managing director, South Asia, Turner International India; Gaurav Gandhi, group COO, IndiaCast and Shubham Majumdar, head - telecom, media, internet, education, Kotak Mahindra Capital.

With many controversies plaguing it, the digitization process - which started with a bang two years ago - seems to have come to a screeching halt. The panel seemed to be of the opinion that the glass was half empty with a lot to be done. Jain tried to look at the problem from the broadcasters' point of view. He pointed out the differences between digitization replacing the basic cable system and an actually digitized world. The help required from the government to prevent piracy was not available either. Jain also expressed his disappointment over the fact that political influences and stand-offs between various stakeholders had cost the industry dear, with MSOs not even being aware of where the boxes had been installed.

"We must start looking at completing digitization in one state at a time, ensuring that it has been done in an organized fashion. Only then should we move to the next state," he advised. D' Silva bluntly asked broadcasters to accept that there has been a mess up so that a solution can be chosen. According to him, digitization has never been a one-man game. But the four parties involved - the government, MSO, LCO and broadcasters - have never sat down together to discuss the problems and find a way forward. He is hopeful however, that it is not too late. If the four decide to have a common meeting with a common agenda, without thinking about personal gains, it is possible to get digitisation back on track.

Gandhi couldn't agree more. He felt that conflicting interests have been the biggest hurdles. He explained how in the first phase there were almost no disputes. However, in the second phase the MCOs and LCOs could not find a way to work together. The link, which broke from there had a ripple effect through the system. "We can blame the government and the broadcasters. But the truth is that till the weak link is mended we will not move forward. Next year also, we will be sitting here and talking about what to do instead of doing something," exclaimed Gandhi.

Majumdar pointed out that unless it is made clear how the cookie is split, the process forward would not be smooth. In such a scenario, the consumers get all the benefits because they will get set top boxes at a subsidised rate while having the whole bouquet of channels at their disposal. Johri added that, "TV is the primary source of entertainment in most households. We are trying to become digital with an analogue mindset. And this is an idealistic world we are trying to achieve - all of us will sit down and talk it out." Johri went on to explain this with the help of examples from Dish TV and how they went from a two-channel company to a multi-channel provider, by being proactive.

D' Silva questioned the role and usefulness of MSOs. He suggested that creating a prepaid model would rid it of middlemen, thereby simplifying and accelerating the entire process. D' Silva and Gandhi agreed that the day the carriage fee stops, MSOs will realize that their flow of income is gone.

Jain took the opportunity to point out some issues that need to be corrected. According to him both packaging and collection have to be looked at carefully. Sending out preactivated boxes without knowing what the consumer wants to see was foolish. Also, the money is stuck at the LSO end. Therefore, bills are getting generated but the cash collection is not happening.

Gandhi added a lighthearted moment by pointing out that in the last decade the price of milk, gas, petrol - and even Pepsi - has doubled. But the price of cable is still at Rs 200. Jain added that the future can be saved if the process is made prepaid and the price is decontrolled.