Seventeen years after the advent of cable in India, the government is finally making it mandatory for cable operators to obtain a licence for providing services.
The draft recommendations submitted by the Telecom Regulatory Authority of India (TRAI) require all 60,000 cable operators, who provide services to 80 million homes in India, to obtain a five-year licence with a onetime entry fee. The licences will generate revenue worth $14-16 million.
The recommendation has been long awaited by broadcasters, as they have been bearing the brunt of low subscriber declaration by cable operators. The extent of the under-declaration can be gauged from the fact that broadcasters get subscription revenues for only 20 million homes,just a quarter of the cable-connected homes in the country.
The proposal is widely accepted by broadcasters and the Cable Operators Federation of India (COFI), which represents cable operators in the big cities. Business Standard quotes a senior Star TV executive saying “This is what we have been pushing for over a long time. It will put some order in the industry and benefit all stakeholders”.
Roop Sharma, president of COFI, said: 'Mandatory licences and high entry fees for cable operators will go a long way towards bringing some order and transparency in this industry'. However, the proposal is expected to be frowned upon by some cable operators.
The draft proposal suggests that all cable operators and Multi System Operators (MSOs) will have to obtain a five-year licence by paying entry fees. Cable operators will have to shell out between $231 (Rs.10,000) for district-level to $2,000 (Rs 100,000) for state level licences. MSO fees range from $2.5 million (Rs 2,500,000), for national level to $0.5 million (Rs.500,000) for state and $2,000 (Rs 100,000) for district level.
Income tax returns and permanent account numbers will be mandatory for companies or individuals offering cable services. It will also be mandatory for cable operators to disclose their subscriber base when they file their applications. X
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