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Pricing problems

IN THE entire CAS controversy, the role of the pay channel broadcasters remains the most puzzling, and has led to allegations that they are still not willing to countenance a CAS future. Even after the introduction of CAS, they were offering prices of the pre-CAS era for individual channels. "One must remember that those prices were pegged high, on the ground that there was gross under-declaration of connections by operators, pre-CAS. Now, CAS means full declaration. Why have the broadcasters resorted to the same pricing, without lowering rates and attracting subscribers," wonders a consumer activist.

"We have priced our channels based on what we think is appropriate," says Sunil Khanna, Chief Executive Officer, Zee Turner, whose Cartoon Network is the driver channel for the group in Chennai. The price of Cartoon Network remains unchanged, pre and post-CAS for the metro, he acknowledged.

That pricing strategy means that the city cable television subscriber is actually paying more for the same old service, and the "pro-consumer" image sought to be given to CAS by the Union Minister for Information and Broadcasting, Ravi Shankar Prasad, is no more than a myth.

The cost breaks up as follows. The Hathway service that has 32 pay channels and about 50 FTA channels costs some Rs.325 a month, including a rental for the STB (Rs.30) and taxes (Rs.32 in all — those leasing an STB in Chennai pay a Rs.6 sales tax on the lease amount too). The pay channels alone come to Rs.189, in a package that claims to provide a 60 per cent discount, exposing the far from consumer-friendly pricing strategy. In the case of SCV, the full pay channel package is priced at Rs.185 plus other costs, indicating a comparable total bill.

This stands out in stark contrast to the earlier cable TV bill for the consumer, including the pay channels, at a maximum of Rs.240 in the affluent areas of the city, and Rs.160 in the lower middle class localities.

"With CAS, the Government has created a tollgate, without building the highway," says Sashi Kumar, Chairman, Media Development Foundation. When a fee is being collected, the consumer has to be told what it is for. In the current dispensation, the costs have risen for the consumer, but what was the rationale for the involvement of the Government, which claimed to be working for the opposite?

Industry watchers tend to see the entire CAS plan as a "cart-before-the-horse" phenomenon in a sector that covers millions of consumers nationwide. The Governments at the Centre and in the States have ignored fundamental weaknesses, while engaging in frenetic activity at the last mile involving the operator alone.

The problems in Tamil Nadu include the lack of a superhighway cable plan for the State. With such a plan, the Government could have streamlined the cable network, if need be on a build-operate-transfer basis. This would add value to the service, as the network would have greater integrity, and technological sophistication. "Today, because of the internecine cable operator conflicts, optic fibre networks cannot be put up. Sabotage of an optic fibre network is not easy to repair. As a result, consumers are getting lower quality pictures and no additional services like internet and teleshopping, which is what cable is all about," says an analyst.

The only State which took the effort to bring some professionalism to the network is Kerala, where the electricity distribution poles were licensed to carry communication cables also. That move also practically eliminated the risk of vandalism, because few would venture to mount an electricity distribution pole to cut a cable. Importantly, the Government also earned extra revenue, but few other cash-strapped States took the cue.

G.A.

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