FinHow

Digitization is compulsory from 31-October-2012 in four metros.

Contact your cable operator today.

Go digital or go black.

Those are some of the quotes made by Ministry of Information and Broadcasting on television. Will the digitization benefit consumers?

Before digitization

1. Customers were paying a couple of hundred rupees for installation of cable TV.
2. Customers were getting all the channels that cable TV operator was offering and yet the price was not more than couple of hundreds.
3. Sometimes, cable TV operators would play the movie on one of its channel – a freebie.
4. Quality of reception was also acceptable and no one was complaining that quality of reception was bad.

After digitization

1. A normal Set Top Box costs around Rs 1000, with HD costs around Rs 3000 and with recorder costs around Rs 6000.
2. If consumer changes from one operator to other then customer needs to buy a new Set Top Box and the older Set Top Box is useless.
3. Monthly expense for cable is at least Rs 100 and in most cases more than a couple of hundred rupees. If you want to get a bundle of all the channels then cost is far more than what cable TV operators were offering.
4. Nothing is free with digitization. Show case movies, though not costly compared to theatre, but still stand close to Rs 50 per movie.


5. There is no big difference in the quality of reception.

As you can see customers are at disadvantage in terms of cost with digitization and there is no considerable improvement in quality.

Why might government have decided to impose digitization?

1. There is little control over the number of subscribers that cable TV operators declare for tax purposes and the actual number of subscribers. This might have been causing loss of sales tax and income tax, and thus government may be interested in digitization.
2. Many a times, neighbors of customers were taking a free ride (tapping on the wire to get cable for free). This was a loss for cable TV operator. This might be one reason that cable TV operators are supporting digitization.
3. Set Top Box is a commodity that many big players are selling with their cable TV services. The companies as well as government is earning with those extra sales. The companies would have pressed for digitization.
4. Movies or freebies that cable TV operators played in the past might not have passed the royalties to the producers of those movies or programs. Showbiz lobby would have strongly pressed to impose digitization.

It seems the intention of digitization was not to benefit cable TV customers and rather for other undeclared reasons.

What is best in interest of all?

1. Cable operators should not force customers to buy Set Top Box and rather give these boxes on rent.
2. There should be Set Top Boxes that are available for purchase/rent and that work with all operators.
3. Government should ask cable TV operators to review their tariffs because if pilferage of revenue is reduced then cost benefit should also go to customers.