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IHS: India’s cablecos unlikely to meet October DSO deadline

India’s cable TV operators are looking increasingly unlikely to meet the government’s target of complete digitisation for the major cities of Chennai, Delhi, Kolkata and Mumbai by October 31st, although the telecoms regulator is unlikely to follow through on its threat to enforce a blackout on any laggards, according to a new report from IMS Research (now part of IHS).

October’s cutoff point is the third deadline imposed by the Telecom Regulatory Authority of India (TRAI), after three states indicated publicly that they could not meet the previous deadline of June 30th, with the governments of Maharashtra and Tamil Nadu governments requesting an extension of the metro deadline to December 31st.

To put things in perspective, IHS calculates that by the end of June of this year, only 20 percent of Chennai, Kolkata, Mumbai and Delhi cable subscribers were digitised.

“Digitisation rates of the four major metro areas vary widely,” observes Anna Maxbauer, manager of the IMS Research Online Set-top Box Database. “Mumbai, at just over half digital, is most likely to meet the October deadline; however, Kolkata and Delhi are each between 30 and 40 percent digitised, and Chennai is less than 20 percent digital. However, the likelihood that any metro will fully comply with the 31 October deadline is small based on the current pace of digital uptake.”

Assuming the 31 October deadline sticks, multiple system operators (MSOs) in the four metro areas must digitise more than 500,000 new households per week between now and the end of October, according to the report.

However, Ms. Maxbauer is skeptical that this will happen: “China, the only other country to attempt cable digitisation at this scale and pace, has averaged less than 300,000 households per week, working with consolidated operators under close state management.”

Many Indian operators, by contrast, have struggled to finance infrastructure build-outs, and must accommodate a slow and disorganised regulatory body, the TRAI, which did not issue key digital interconnectivity and fee rules until 30 April, further delaying roll-outs.

Ms. Maxbauer believes that additional modifications to the current deadline are possible, but unlikely to be announced until the last moment. Government scrutiny of MSOs’ digitisation plans has increased recently, and exceptions may be granted on an operator-by-operator basis.

“TRAI must consider that, even in a best case scenario, enforcing the October deadline is likely to leave millions of cable households in the dark. Adopting a realistic strategy now will reduce problems down the road.”

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