Financial Daily from THE HINDU group of publications
Saturday, Mar 25, 2006
Industry & Economy - Radio/TV
`Restructuring part of larger expansion plans'
According to Zee Telefilms, cable digitalisation will open opportunities for niche content. Its Chairman, Mr Subash Chandra, says that restructuring is part of larger expansion plans. He adds that the planned restructuring will bring more focus to different businesses.
Excerpts from CNBC-TV18's exclusive interview with Mr Subhash Chandra:
First your thought on what you have heard in the last one-month from the Delhi High Court on CAS? With your own DTH plans, how do you see this whole space shaping up in the next six months or so?
Digitalisation of the cable is what the high court has said. CAS (Conditional access system) is a misguiding nomenclature that we all use. With the digitalisation of the cable, there will be no chalking of pipe in the cable and each household will be able to watch the programmes they want to and block what they don't want.
Pay for what you want and do not pay for what is unnecessarily pushed into the pipe. That will open more and more opportunities for niche contents. Zee as a company is a very well placed in terms of its distribution through cable as well as through Dish TV to exploit those synergies.
In sync with that move your company is considering a restructuring plan. Are you planning to demerge Zee into different clusters such as distribution business, entertainment, and news channel and list them separately?
I cannot say anything now because the board is meeting and different things are under consideration. But I can only say that we are preparing ourselves for this digital future, which this industry is going to get into.
We are partnered with IBM for creating our content for digital arena. We have partnered with Open TV to give more interactive television.
Recently we partnered with Intel for bringing digital home entertainment into the houses. Restructuring is part of one of those exercises.
Give us a progress on what has happened on the DTH front? I believe you have persuaded Sony to join you in the DTH bouquet as well? Do you think DTH will be become a full-fledged national reality in the next 12 months?
Definitely, it is a reality with 3 million subscribers, though 2 million are with DD because that is free-to-air kind of DTH, which is a unique model in India. Dish TV has close to one million subscribers and adding around 3,000 viewers a day.
Have you persuaded Sony to indeed join your bouquet and what would be the average realisations that you are getting for those one million subscribers?
Our current realisations is Rs 190 per subscriber. But it is going to grow with the launch of the video demand and gaming applications. Value-added services and especially niche contents are also coming up. Regarding another bouquet joining us, I can only say, we are in serious discussion and the negotiations are at an advanced stage
How would the Zee TV shareholder of the listed entity benefit from your DTH upside because today they are held under separate heads. Post restructuring, do you have any plans of bringing it directly together, so that your shareholder can benefit more directly?
I think we have a solution to that. We have cut that problem and you will hear about it very soon.
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