Star India will enter into nationwide rather than city-centric deals with multisystem operators (MSOs) INCablenet and Hathway Cable & Datacom in an effort to rationalise the declaration of subscriber base and tackle the issue of under-reporting. The move is expected to ensure a more harmonious relationship with the MSOs.
According to channel sources, it is a bottom-up approach, which would examine the local market conditions, competition, actual declaration and potential of increasing the base before finalising the deal at the central level. This would ensure a coherent business strategy and do away with the ugly situation of blackouts in certain cities when an amicable relationship exists between the MSO and the broadcaster in other locations. The payment, subscriber declarations and other transactions would, however, continue to be city-centric.
But with SitiCable, Star’s strategy will be to enter into deals with the former’s joint venture partners rather than have a centralised agreement. This will give Star an advantage as SitiCable has a joint venture structure with its cable operators. The other MSOs have a distributor-franchisee agreement with their operators.
Star is pressing for a 100 per cent increase in declaration of subscribers, after deciding to drop the cable subscription price by 25 per cent from Rs 40 to Rs 30.
According to sources Star is preparing the ground for a price-value rationalisation when it struck an agreement with INCablenet and Hathway to help increase the declaration of subscribers in Mumbai. Several cable operators are yet to agree on Star’s drive to increase declarations.
With the new pricing strategy, Star believes it will see significant growth, even in a year which will have Sony Entertainment Television India flex its muscles with the cricket World Cup as the driving force.