MUMBAI: The Cable and Satellite Broadcasting Association of Asia (Casbaa) has called on the Government of India to make a shift in its regulatory approach to the pay-TV industry.
Casbaa CEO Simon Twiston Davies says, "The Indian authorities' current positioning is holding back the industry and introducing significant new constraints of the kind that slowed India's economic development for decades".

According to Casbaa, recent initiatives by the Ministry of Information & Broadcasting (MIB) and the Telecom Regulatory Authority of India (Trai) will severely limit development, not just of pay-TV, but of the entire Indian communications industry.

Speaking at a conference in Delhi organised by the Associated Chambers of Commerce and Industry of India (Assocham), Casbaa said it would like to see more emphasis on promoting growth, rather than on restricting market flexibility, adding that international and domestic examples of thriving, lightly regulated markets are plentiful.

A Casbaa study last year Regulating for Growth clearly demonstrated this linkage, under-scoring the success of markets such as Singapore, Japan, Malaysia and Hong Kong.

Davies adds, "India can make immediate and enormous strides towards becoming a digital leader - if it takes fundamental steps to loosen restraints on industry growth. The size of Malaysia's pay-TV market, for instance, has doubled in the last three years."

In other Asian markets bidding for cable systems is generating offers of more than $1.5 billion each, yet there is little encouragement of fresh domestic or foreign investment into the India market.

Meanwhile, Casbaa believes that the proposed Broadcast Services Bill would create a new pay-TV industry regulator potentially subject to political interference.

Favies says, "India needs to install a truly independent communications industry regulator. Regulatory decisions should be technical and quasi-judicial, responding to the demands of the fast-changing media environment, and not subject to transient political pressures."

Casbaa also highlighted items such as the recent Trai decision to set maximum retail prices for all pay-TV channels at Rs5 ($ 0.11) each and the draft Broadcasting Services Regulation Bill (2006) - which mandates local content requirements for every pay-TV channel.

"Does the Government of India really believe that all TV channels have the same value; that a high cost movie channel should be priced in the same way as a channel dedicated to low cost chat shows? This makes no sense," argues Davies.

According to Casbaa investment in high-quality content could quickly dry up as channel providers find they cannot make a return on their investment. The rate cap decision could quickly produce a race to the bottom in terms of content, to the detriment of viewers.

The maximum retail price directive ignores market realities states Casbaa. "It is now over two years since TRAI first instituted a cable price freeze which it said would be temporary until the launch of DTH satellite services. Unfortunately, that understanding seems to have evaporated, even though we have two DTH platforms that are now competing ferociously - with each other and with cable providers," said Davies.

Casbaa also has serious concerns over a proposed 15 per cent 'local content' requirement for all channels aired in India, another example of regulation that will restrict the access of Indian viewers to premium content, especially international news, documentaries, sports and entertainment.

Many internationally focussed channels do not have India-specific feeds. "How can a global news channel meet a 15 per cent local content requirement? News happens where it happens. The same applies to international sports. And how reasonable is it to expect niche channels from Italy, or Australia, or Germany, or China to carry Indian programming?" ask Davies.

According to Casbaa, India's content industries are already strong and don't need artificial life-support. "India's film and television industry is now an export market and part of the global industry. Indeed, it benefits from the airing of Indian-generated TV programming in jurisdictions that don't impose content quotas. The domestic market should operate in sync with the rest of the world and gain the full benefit of a global marketplace.

"Without taking account of the new digital world, India's pay-TV regulators will fall further and further behind global trends," Davies warned.