MIB to meet MSOs on 18 Dec to discuss issues related to cable broadband

MUMBAI: The ministry of information and broadcasting (MIB) is organising a conference with cable TV industry representatives on 18 December to discuss the potential of using the existing cable TV network in provisioning broadband service.

The conference is being organised through BECIL with leading multi system operators (MSOs).

The ministry will discuss various issues and seek the views of MSOs about feasibility, affordability, and ubiquity on the issue of broadband services through cable TV Networks, infrastructure required for the same and modalities of payment and segregation of revenue earned for broadband activities.

The major issues to be discussed include the willingness of the operators to invest in the infrastructure required.

The payment of 8% Adjusted Gross Revenue (AGR) as fee to DoT, whether to be paid only on the broadband services or on overall revenue earned in respect of both the businesses will also be discussed.

Also on the discussion table is the issue of whether a separate entity needs to be created for the broadband activities for segregation of the revenue earned on it.

The conference will be held at Gulmohar Hall, Habitat Centre, Lodhi Road, New Delhi and will see participation from major MSOs, officials from MIB, Department of Telecom (DoT), Telecom Regulatory Authority of India (TRAI) and BECIL.

It is pertinent to note that the Parliament Standing Committee on Information Technology (IT) has asked the DoT to relook at the issue of charging 8% licence fee for the internet service provider (ISP) licence from cable TV companies based on their adjusted gross revenue (AGR) revenue which includes the cable TV business.

The MSOs have long argued that the ISP licence fee should be charged only on broadband business and should not include the cable TV business.

In its report on the broadcasting sector, the committee had noted that the issue of payment of 8% AGR as licence fee to the DoT has held up the utilisation of the vast cable TV network across the country for providing high speed and reliable broadband connectivity in India.

It had also stated that the utilisation of the existing cable TV network for providing high speed broadband will also reduce the burden on National Optical Fiber Network (NOFN) while also providing numerous employment opportunities in the sector.

The committee had asked the MIB to impress upon the DoT for an early decision in the matter.

It had noted that existing Cable TV networks, after certain technical upgradation, can be used for providing broadband services at high speed. The cable TV operators can lay overhead optical fibre access network much faster and economically in order to provide broadband services. Many MSOs are already providing broadband services over their cable TV network.

The Telecom Regulatory Authority of India (TRAI) has recommended provision of Right of Way (RoW) and infrastructure status to MSOs and LCOs so that they can effectively lay their network and get financial assistance from banks for up gradation of their network.

However, the committee had noted that many MSOs/local cable operators (LCOs) are not very keen on providing this facility.

The consumers are devoid of this facility as the cable operators are not ready to pay the 8% AGR as fee to DoT as required to be paid to the Government on the total collection, including collection from the cable TV service.

To avoid the payment of 8% fee, the committee noted that most of the operators have created separate entities for providing internet services and are providing separate cables for the internet service for which a separate internet modem is also provided.

For internet service, the setup of the LCOs should be bi-directional whereas it is mainly uni-directional at present. If the issue of 8% of AGR fee is resolved, more & more operators would go for making their system bi-directional to provide internet service on the same cable which is used for TV service.

To give incentive to the cable operators, TRAI had issued a recommendation to DoT for waiving off the revenue from cable TV services from the AGR for a period of four years, the committee stated.

It had noted that the MIB and TRAI had raised this issue and Cabinet Secretariat had constituted a Committee to examine the issue and come out with recommendations. However, a final view could not be taken on this and now the issue is again under consideration of DoT.