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Thursday, 2 November, 2000, 15:39 GMT
India approves direct home broadcasts
Satellite dishes
Until now, only cable operators could download broadcasts
India's federal cabinet has cleared the introduction of Direct-to-Home (DTH) satellite broadcasts.

The decision allows broadcasters to beam their programmes directly into Indian homes through small satellite dishes.

Until now, satellite broadcasts could only be received by licensed cable operators, who then distributed it to individual homes.

DTH in India
Licenses will cost $2.14m
They will be valid for 10 years
Companies need an Indian chief
Foreign equity up to 49% only
Foreign investment up to 20%
Existing broadcasters cannot bid
This meant that the broadcasters earned very little subscription fees and were mostly dependent on advertisement revenue to cover their costs.

Under the new policy, companies - with up to 49% foreign equity - can buy licenses to start DTH services.

The license is to cost $2.14m and will be valid for a period of ten years.

There is no limit on the number of companies that can apply for the DTH licenses, but they all need to have a resident Indian as their chief operating officer.

The companies would also need to cap their Foreign Direct Investment at 20%.

Concerns

DTH services were first proposed in India in 1996 but were hampered by concerns over national security and cultural invasion.

Sushma Swaraj
Sushma Swaraj: Media is not just another trade sector
In 1997, the government even imposed a ban when the Rupert Murdoch-owned Indian Sky Broadcasting (ISkyB) was about to launch its DTH services in India.

Information and Broadcasting Minister Sushma Swaraj said the cabinet had "taken care of concerns about national security and obscenity" in its decision.

The new policy requires all operators to set up earth stations in India within 12 months of getting a license.

The government will monitor their programming and any violations could attract hefty fines and a revocation of the license.


It will lead to more programmes being produced in India

Broadcaster Bhuvan Lall
Some of India's major broadcasters - Zee, Star, Sony and the state-run Doordarshan - are interested in starting DTH services.

But the law forbids existing broadcast companies and cable networks from holding more than 20% equity in a company applying for a DTH license.

"We have also addressed the question of vertical monopoly," Ms Swaraj said. "The media is not just another trade sector."

Welcomed

Though the finer details of the DTH policy have still to be spelt out, media circles have reacted favourably to the announcement.

"It will lead to more programmes being produced in India, a growth of niche channels and lead to further investment in the television and entertainment industry," Bhuvan Lall of the Indian Broadcasting Foundation told Reuters.

Some 30 million Indian homes have cable connections, and a sizeable chunk may be willing to subscribe to DTH services.

Apart from enhanced picture quality, DTH has the scope for interactive TV services such as movie-on-demand, internet access, video conferencing and e-mail.

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See also:

26 Jul 00 | South Asia
Indian boost for broadcasters
22 Feb 00 | South Asia
Radio boom for India
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