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Cable operators need to focus on broadband to take on Reliance Jio
PUNE: With only 1 per cent of cable TV homes having a broadband connection, the multi-system operators (MSOs) and local cable operators (LCOs) have a tremendous opportunity to open up another revenue stream by offering cable plus broadband services.
By offering broadband, cable TV operators can compete with the 800-pound gorilla called Reliance Jio which will roll out 4G broadband and data services from 2015.
“Consumer is the king as they can watch content anywhere anytime. Today people are no longer confined to the television set,” said Kumar while speaking during a panel discussion on ‘How to create a robust broadband ecosystem’ at GroundPost, TelevisionPost.com’s digital summit, in Pune.
Kumar added that the consumption patterns are changing and it’s high time the cable industry also adapted to the changing scenario. This is the time for the cable industry to embrace new technology.
“One of the things that will drive this change is broadband. It’s only a matter of time before over-the-top television becomes a reality. The consumer will have choice of watching content as and where they want,” he averred.
Eponentia Capital principal Neeraj Bhatia, who was moderating the session, said that the four of the five main pillars on which any industry stands are in place for broadband.
To begin with, technology is becoming cheaper. Secondly, government is wholeheartedly supporting broadband expansion. Thirdly, cable operators don’t need to share revenues with MSOs unlike cable TV. Fourthly, data consumption is growing and the customer is paying for it.
The fifth and the missing link in the broadband story is the willingness of service providers (MSOs and LCOs), which is where change is required. “No change is required in technology, government or customer. Change is required at the service provider level,” asserted Bhatia.
Concurring with Bhatia, Cisco CTO – India service provider video Manoj Barara said that technology has indeed become cheaper. In 1998, a modem was sold for $300. However, today it has come down to $20.
“Now is the right time to roll out broadband. There is push from all the sides like technology, government and consumer. Cable operators have to decide when they want to start broadband,” noted Barara.
Broadcom director of sales Rahul Khosla said that cable has the potential to fuel a broadband revolution. An estimated 120 million homes have cable connectivity, which gives a great opportunity to increase broadband penetration.
“Cable is the biggest medium in the country today. Cable operators have the network and access to the last mile. They must offer all services that they can through their network,” Khosla said.
Khosla was confident that broadband connectivity will increase as big MSOs like Hathway Cable & Datacom and DEN Networks have taken a lead in this drive.
According to Kumar, cable networks are a gold mine: “You have the broadest pipe to the home and no other service provider is able to offer that kind of a pipe to the home. This is a good chance to launch data services. If you don’t do it, somebody else will.”
Talking about different broadband technologies, Barara said that cable operators can provide broadband over the same network using Docsis technology. Docsis, he said, is a standardised technology as cable operators can buy CMTS and cable modems from any vendor.
In response to the general anxiety over the invasion of Reliance Jio, Bhatia said that the first thing is not to focus on Reliance Jio.
He also said that cable operators don’t need to own content to service the customer and locally concentrated businesses can have scale. Reliance Jio, on the other hand, has to build separate networks in different cities.
Khosla was also of the opinion that cable operators need not lose sleep over Reliance Jio. “One doesn’t need to worry about Reliance Jio. Cable TV’s biggest strength is localisation. Cable operators need to be service oriented to overcome competition,” he asserted.
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