NEW DELHI: Partners-turned-rivals Subhash Chandra and Rupert Murdoch seem to do things in tandem. The Chandra-promoted Zee Telefilms has sought permission of the Indian government to "turnaround" satellite channels in a digital format from its uplink base on the outskirts of Delhi for, what Zee calls, a headend in the sky project.

This was done almost at the same time (last week) that the Murdoch-controlled Virgin Island-registered Star News Broadcasting Ltd. moved the Indian government for permission to transmit news content for its proposed news channel in collaboration with an Indian content partner, Star India Pvt Ltd.

Government officials told indiantelevision.com that the information and broadcasting ministry has received a detailed proposal from Zee for putting a headend in the sky that will substantially lower investments on cable headends by cable operators and multi-system operators as and when conditional access system (CAS) is implemented.

The concept mooted by Zee, government officials pointed out, is being studied as it can go a long way in solving various problems of the broadcasting and cable industry and can go some way in dealing with the frequent face-offs between broadcasters and cable operators that put cable viewing subscribers at inconvenience.

What is a headend in the sky? In short, pay channels are decrypted and aggregated at a central facility (here it would be Zee's uplinking base at Noida), then all channels are up-linked with common CAS inserted. After this, the channels are downlinked at headends where the cable operator, with the help of a trans-modulator, makes the satellite signals compatible for a cable system and mixes signals of free-to-air channels for further re-distribution to cable subscribers. The combined channels go to subscriber's set top box and get decrypted for viewing on the TV set.

According to Zee executives, the proposal, prepared by its cable subsidiary Siti Cable, is being examined by the government and talks also have been initiated at both formal and informal levels with other broadcasters like Sony Entertainment Television India and Star India for inclusion of their respective channels in the common encrypted signal.

The Zee executives also pointed out that this way investment in a post-CAS era would come down substantially as the headend in the sky project is likely to cost between Rs 150 and Rs 180 million. Technical advantages of this apart, otherwise in a post-CAS scenario an average cable operator would have to shell out between Rs. 60,000 and Rs 100,000 per channel to upgrade his/her system.

At the moment, an average Indian cable home with a comparatively modern TV set is capable of receiving on an average about 50 channels.

If the project gets the government nod, then at a later stage the subscriber, through the set top box, can have a new service or go in for a change in his service mix by calling up a toll free number connecting to the subscriber management system (SMS) and log in his request. The subscriber management centre sends a message to the "turnaround" centre and executes the request through a data controller. The billing is generated by SMS and sent to the subscriber through designated means.

If the project gets the government nod, then at a later stage the subscriber, through the set top box, can have a new service or go in for a change in his service mix by calling up a toll free number connecting to the subscriber management system (SMS) and log in his request. The subscriber management centre sends a message to the "turnaround" centre and executes the request through a data controller. The billing is generated by SMS and sent to the subscriber through designated means.

The Zee proposal with the government also moots that all stakeholders in the industry should be part of the headend in the sky project and a separate legal entity can be formed with equity stake offered to all stakeholders, namely broadcasters, cable operators, and MSOs.

To ensure equal representation from all stakeholders, the shareholding pattern of the proposed company, implementing the headend in the sky project, may be broadly divided equally amongst broadcasters (33.67 per cent), MSO (33.67 per cent) and cable operator (33.67 per cent), the Zee proposal states.

The big question is: will all the broadcasters agree to common encryption?