Nearly, three years after well-heeled Indian Television Viewers were tantalised by the prospect of unrestricted access to hundreds of global channels, the Union Cabinet on 2nd November 2000, finally cleared Direct-to-Home (DTH) broadcasting.
WHAT IS DTH
Direct-to-Home is essentially a delivery system. A DTH subscriber can get all the channels with a pizza-size dish antenna and a decoder box. He doesn't need a cable connection or huge dishes that are required for C-band (the frequency on which Star and other channels broadcasts). DTH is telecast on the KU-band. This is merely a stronger signal, which is encrypted by the decoder and accessed by the subscriber. Under C-band range the cable operators were already providing DTH service. But the operators have to depend on a 12 feet diameter dish antenna and they could receive only 20 channels. But when KU-band comes into existence it can receive up to 200 channels with a tiny 12-inch dish antenna.
The opening up of the DTH television service is expected to lead to a technology war between 'open architecture system' and 'proprietary system'. The Open Architecture Technology enables a subscriber to access more than one DTH service. One-time investment in the set-top box or integrated receiver decoder required even if one wants to shift to another platform. Other service can be accessed by changing an access card. The proprietary Technology enables the customer to access only the service provided by one operator. Each time the subscriber wants to shift to another service or platform it would be necessary to make changes in the existing hardware. Other services cannot be accessed.
The open architecture system means technology similar to the cellular phones currently in vogue in the country. In this case, DTH subscribers would have to make a one-time investment in the hardware. The consumer's preference on the service would depend on the access card (akin to a SIM card), that will be provided by the operator.
On the other hand, proprietary technology implies that hardware for DTH is made to the specification of one particular operator, which can only accept the access card provided by the particular party. If the subscriber wishes to shift to the similar service he would have to invest in new hardware again.
Now, when DTH is allowed with proprietary technology then it means either blocking of entry of competitors or, making it imperative for the government to issue licence to the operators providing the service at a later stage.
Keeping the subscribers in mind the government at a later stage would not be in a position to deny the subscriber a licence under the Broadcasting Act. Though it is not a good idea to block any form of technology from entering the country, it may be desirable on the part of the government to spell out clear-cut policy guideline on DTH. This may prevent the possibility of a monopoly in DTH services.
The proprietary technology versus open architecture technology debate still remaining a major bane of contention, some DTH operators favour a receiver which will allow the consumer to use only its signal. The open method allows the consumer to buy a receiver, a very expensive piece of equipment, form a DTH provider and have the option of receiving signals from any DTH provider later. The proprietary option will benefit consumers who subscribe to one-DTH provider.
The policy on DTH include the following clauses:
DTH service obviates the need for your friendly neighbourhood cable operator. What you get will be what you pay for. For an investment of around Rs. 12,000 on a decoder and a pizza-sized dish antenna, a DTH subscriber will be able to receive global channels.
The Centre has, however, built in safeguards against the creation of broadcasting monopolies, compromise of national security and distortion of public taste.
There is to be a 49 per cent cap on foreign equity in DTH service providers. Of this, up to 20 per cent is to be foreign direct investment and the rest is to be foreign institutional investors, overseas corporate bodies and non-resident Indian investments.
DTH is the first major step towards convergence but extra caution had been taken to ensure that no vertical monopolies were created.
For security reasons, DTH players will have to beam from the home soil through earth stations within the country. They will also have to adhere strictly to the advertisement and programme codes lay down by the Ministry of Information & Broadcasting.
For similar reasons, the chief executive officer and a majority of directors of DTH companies would have to be resident Indian citizens.
To obviate creation of monopolies, the share of existing broadcasting companies and cable network owners would be restricted to 20 per cent in the DTH ventures. The new companies will also have to keep the I&B Ministry informed about any changes in the equity pattern.
There will be no restriction on the number of DTH licences to be issued by the I&B Ministry for a 10-year period.
While companies will have to furnish an initial deposit of Rs 10 crore, they will have to pay Rs. 40 crore as bank guarantee for the 10 year license period. At least 10 per cent of the total revenue generated will have to be shared with the Government.
In case of violation of rules, apart from the threat of revocation of the licence, the errant companies will have to shell out penalty to the tune of Rs. 50 crore. They will be required to preserve for at least 90 days, recordings of all programmes to be able to make those available for Government scrutiny.
Doordarshan could also provide DTH service but the final decision in the matter rested with Prasar Bharati. Companies keen on using the technology for other services like fax and Internet will have to obtain separate licenses. DTH service providers have to show Doordarshan channels on the must-carry mode.