Sushil Kumar, Director, Darsh Digital Network Pvt. Ltd.
The process of digitization has completed, so far as the government and the broadcasters are concerned. Phases I, II, and III of digitization have completed, and Phase-IV is also on the verge of completion, i.e., on 31st March, 2017. This digitization is nothing but the extended form of analog. Still, broadcasters are amending the subscription agreement mostly on fixed fee. The revenue for the broadcasters has increased manifolds but as far as MSOs are concerned they are still getting the subscription as the way they were getting it in the analog era.
Due to digitization, broadcasters have reduced their channel placement fee and have increased the subscription manifolds, getting the double benefit. Still, they are selling their content on bundle basis and also forcing the MSOs to make all the channels available to end consumers. So this is not digitization in the true sense, as consumer does not have the choice to select the channels and broadcasters are not fair in their deals with the MSOs.
Broadcasters are forcing MSOs to make all channels available to consumers at a very high cost and with reduced carriage fee. MSOs are still getting the subscription, which they were getting in the analog phase. Cost of content has increased along with other expenses to maintain the system. To digitize Phase-III areas, the industry has to pay a huge amount to lease line cost to telecom companies, which is also not easily available.
Government revenue has increased due to tax without providing any relief or incentive to MSOs for digitization. Digitization does not mean just providing digital signals through set-top boxes to the end consumers. Digitization in actual means consumers have the right to choose the kind of channels they want to watch and pay for them. Consumers should pay for the content that compels them to watch and pay for it, but nowadays broadcasters have done mostly fixed-fee deals with all the MSOs and also ensured that all MSOs should telecast all the channels of the concerned broadcasters. This forces consumers to pay for all those channels also which they really do not want to watch. The MSOs are also forced to pick the bundle of channels offered by the broadcasters; if MSOs do not pick the bundle then the rates of the channels offered on a la carte basis are unjustified. Digitization has just helped the broadcasters to increase their subscription revenue and to reduce the channel placement revenue as well.
This is not the kind of digitization which we had thought of; this is just an extension of analog, where difference is just the consumers are getting digital signals and higher number of channels, otherwise there is no difference in analog and digital era. Digitization means it should allow the MSOs to opt for what they really want to showcase for their consumers, and in the same way consumers should have the choice to select the channels which they are willing to pay for. Broadcasters are still doing the agreements with MSOs in such a way that MSOs are forced to show all the channels in their bouquet. Consumers should also have the right to choose the channels which they really find value-for-money to watch. In the current scenario, MSOs are offering packages as they get them in bundles from the broadcasters to the end consumers. The consumers do not have the choice and have to watch those packages which are offered by MSOs and also pay as per MSO's package rates. In the real sense of digitization, consumers have the right to pay for only those channels which they want to view. The present arrangement of digitization is nothing but an extension of the analog regime.