Trai in its note said that Cable TV Broadband (CATV) has become very popular globally as it is less costly, faster to install and easier to handle. “In India, the cable TV industry has a tremendous reach in urban and rural areas. Due to its affordability and ubiquity, cable broadband could, for India, be a super-fast highway for broadband communication for most homes and businesses in the near future,” it said.
TRAI, also in charge of broadcasting, has often been panned for its inadequate understanding of the sector. Media industry experts maintain TRAI’s thrust to promote broadband connections through local cable operators (LCOs) and ask them to enable their last mile infrastructure to be used by Telecom Service Providers (TSPs). Saying it has been closed for a decade. Media and entertainment consultant Anuj Gandhi, referring to a large number of enterprising local cable operators already providing broadband services, said, “That ship has been on for a long time. It is not a large multi-system operator (MSO). Rather there are smaller last mile operators (LMOs) who are offering broadband in many areas including Mumbai for example.”
During the pandemic, when working from home became the norm and education went online, it gave a boost to broadband services. Gandhi said that Indian consumers adopted the Internet in a big way. He said wired internet saw the highest growth, as reflected in the TRAI data, though all broadband connections provided by cable operators may not be part of these numbers.
Last Mile Operators (LMOs) or Local Cable Operators (LCOs) as they are called, buy bandwidth in bulk from companies acting as intermediaries. They redistribute it to the end consumer with a healthy margin.
Gandhi said, “When TRAI asks telcos to provide their last mile infrastructure to deploy broadband, it is not clear whether a cable operator, which is making 60-70% margin, will be able to do so and Why would one agree to become a reseller for the telco,” Gandhi said.
Changes in the Cable TV Act are unlikely to change things on the ground. However, Bombay High Court lawyer and cable industry expert Ashok Mansukhani feels that the cable sector is well equipped to provide broadband services.
“The 1,761 Multi System Operators (MSOs) and their linked cable operators should provide high-speed broadband to their maximum number of customers in 2023 given the challenges of accelerated 5G access by both Reliance Jio and Bharti Airtel,” Mansukhani said. Told.
However, the cable industry, especially the MSOs, has not paid enough attention to broadband deployment through its vast base.
“The expected record deployment of 5G by the two main TSPs will only add to their woes unless they rise to the occasion, especially in rural India. Another threat, satellite broadband, will emerge in the next two years, but it may be an urban phenomenon,” he said.
“The cable operators may endeavor to provide access to service providers and Internet service providers in a fair, transparent and non-discriminatory manner for the dissemination of broadband services,” TRAI said.
Mansukhani said that Trai’s recommendations have unfortunately sidelined the MSOs. “TRAI, in its concern to open doors for a vibrant cable industry, has completely overlooked the fundamental role of MSOs over the past 27 years in helping modernize the cable industry and provide state-of-the-art digital services to millions of people. Number of customers through LCOs,” he said.
LMOs control 97-98% of cable TV households, with MSOs having direct access to only 2-3%. “They will not sell TSP as it is a business which they have built painstakingly in almost 30 years without the support of the government. This means that instead of buying out cable businesses, TSPs will have to enter into revenue sharing agreements with LMOs through their MSOs to increase deployment of cable broadband.”
Others said the recommendations are loosely formulated and do not give any details on any revenue sharing arrangement between the TSP and the LCO.
Suchi Bansal is the Media, Marketing and Advertising Editor of Mint. The Ordinary Post will look into the important issues related to the three. Or just fun stuff.
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