Pay Channel Trend Likely To Increase

More and more channels in India are soon expected to turn pay as a fallout of corporates slashing ad spend. This was stated by Kiran Karnik, chief operating officer, Discovery Channel, at a press conference here.

"Globally, pay channels are the norm. However, in India the business developed in a different way. Consequently, free-to-air channels have only one source of revenue -- advertising. With that reducing, channels will begin charging cable operators," Karnik said.

Cable operators don't pay anything to broadcasting companies for free-to-air channels whereas Pay channels have to. Pay channel operators also need to install a special decoder to receive them. Presently, there are only three such channels in India including ESPN and Zee Cinema.

Karnik also bemoaned at the lack of regulatory regime in the country. The draft Broadcast Bill has cast a shadow over the entire industry especially with its emphasis on restriction of foreign equity.

The joint parliamentary committee had almost finalised its recommendations on the bill.

By installing set boxes in viewers houses cable operators could control the channels they receive. Normally the investment in such equipment was made by cable operators.

However, operators were unwilling to invest in such equipments as the regulatory regime is not in place. There was panic amongst operators as a clause in the bill suggested auctioning of cable licences as in the telecom sector.

"Many of the small-time operators fear that this would put them out of business," he said. Similarly, broadcasting firms could control how many channels operators received by installing devices at the operators end.

Meanwhile, Discovery Channel is going ahead with its plans to increase the duration of Hindi programming. At present, it has about 65 hours of Hindi programming a week. This could increase to between 18-24 hours every day by the end of the year. Karnik said this was part of the attempt to reach a larger audience.