India's IOL Netcom to sign share-swap deal with local cable operator

October 9, 2008 - Indian IPTV operator IOL Netcom is to sign a share-swap deal with a Mumbai-based local cable operator (LCO) soon in order to boost its customer base for IPTV services, according to reports in local news portal Sify.

A S Oberoi, Executive Director of IOL Netcom, commented that the cable operator has a subscriber base of 1mn, while IOL Netcom's IPTV subscriber base is 10,000, adding: “The idea is to get access to a substantial customer base. Once we reach a critical mass of customers, it becomes viable to roll out IPTV services in the real sense. IOL’s tie-up with the LCO will help the two companies leverage each other’s infrastructure. We will be able to reach their customer base."

Mr. Oberoi said that discussions are in the final stages, and that it will be a "no-cash deal" which is expected to be completed within a month. IOL Netcom is separately seeking to raise INR 156 crore (US$ 32.8mn) via a global depository receipt (GDR) issue, which will be used to fund expansion of its IPTV service in Delhi and Chennai. The operator reportedly wants to expand its service to 14 cities by 2010 and 29 by 2011.

IOL Netcom is also reportedly pilot-testing IPTV services delivered to the PC in Mumbai, and intends to provide data card, desktop CDMA phones, IPTV and broadband services, VoIP and other services to customers of Indian telco MTNL in Mumbai and Delhi.