Faced with the rise in pay channels, the Hinduja-owned INCablenet has hiked the franchisee fee from Rs 40 to Rs 50 per subscriber in Mumbai. The price has also hiked from Rs 55 to Rs 75 in Delhi and Rs 78 in Bangalore. Several multi-system operators (MSOs), are also in the process of raising the fee franchise cable operators have to pay them.
SitiCable is also toying with the idea of raising the fee but the fear of an exodus of operators from the network is preventing such a move. The cable arm of Zee Network is unable to expand territories in Mumbai where INCablenet has the strongest presence, but is being threatened by Hathway in the western suburbs of the city.
Cable operators affiliated to the big MSOs are not willing to pay more when they are unable to pass the cost to consumers. The threat of franchise operators migrating to a rival network has forced MSOs to take a flexible approach.
MSOs are also trying to work out how the revenue streams of operators can go up. INCablenet, plans to upgrade the cable systems if the franchisee is willing to share his network diagrams.
INCablenet has introduced various loyalty programmes to retain their operators. The Olympic Scheme was introduced in Mumbai recently where operators were given a higher commission structure if they exceeded the three-month target for improved connectivity and rates.