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Government ‘HITS’ Cable TV, FDI At 74%
The Indian government has approved the proposal of the Ministry of Information & Broadcasting on policy guidelines issued for Headend In The Sky (HITS) operators . This decision comes after 2 years of receiving TRAI’s recommendations on the digital transmission in cable TV. With HITS, the government expects further penetration of cable TV especially in the rural areas.

What is HITS?

Headend In The Sky, HITS, is a digital distribution platform that, when installed by cable TV providers, will allow them to offer more channels in higher quality (digital signals downlinked via satellite transmission) over their existing cable network.

Unlike DTH, HITS is allowed to operate in both the traditional ‘C-Band’ as well as the DTH operators’ ‘Ku-Band’. The quality may be better on HITS transmitted channels as the Ku Band is vulnerable to rain which causes deterioration in signal strength.

HITS operators will be able to uplink from India only, so broadcasters will also have to change their licenses to ensure their channels are received.

No Sunset Hour?

It appears that the ministry has changed its decision of ordering complete digitisation of analogue cable TV operations. Unlike Conditional Access System (CAS), the guidelines do not make it compulsory for cable operators and MSOs to switch to HITS and they can continue with their existing system.

HITS is being encouraged to lower the operational costs of operators: all the channels would be bundled up in one digital signal, reducing capital investment for operators. However, this sounds like it will affect only new operators and not existing ones and small operators in town and cities might face problems in upgradation.

Existing Operators Have 3 Months To Comply

<img style="float:right; margin:0px 0px 0px 10px;" src="" />Existing HITS Operators such as Essel Group will have to comply with the new policy and make necessary changes within three months or their licenses may be cancelled. Furthermore, HITS operators can provide signals directly to subscribers only if they are an existing MSO or Cable Operator also. According to a report in Medianama, Essel Group has already invested Rs. 35 million in a HITS platform for WWIL, which has a reach of 117 cities today. It has been awaiting the policy to launch its services, is it ready to comply in 3 months’ time?

Advantage Consumers

The advantage of HITS is transparency in terms of consumer cost, which has so far been unclear due to fragmentation of the cable TV industry. As per the statement issued, the cost of the set-top boxes is estimated to go down as more operators adopt the HITS platform and there is penetration in the rural market as well.

FDI Cap At 74%

Total direct and indirect foreign investment including FDI is allowed upto 74 percent according to the guidelines, but anything above 49 percent will require approval from the FIPB. For cable TV operators and DTH providers, the cap is at 49%. There is a cross media holding restriction of 20 percent to avoid vertical integration and to promote competition.

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