It’s Murdoch+Tata v/s Zee now

Rupert Murdoch’s direct-to-home (DTH) broadcasting venture with the Tatas is beginning to shape up. That’s just when the controversial cable TV distribution system—CAS—is all set to fade out. Space TV Pvt Ltd (Tata-STAR joint venture) has filed its DTH application with the government. This coincides with the recommendation of the Telecom Regulatory Authority of India (Trai) to put the conditional access system (CAS) on hold.

In Mr Murdoch’s application, which was submitted on Tuesday, Tata Sons holds 80 per cent. STAR officials Jagdish Kumar and Ajay Sharma have the remaining 20 per cent in the Space TV DTH venture. In an earlier avataar of Space TV, Mr Kumar and Sharma had controlling stake. That plan didn’t get past regulatory norms. STAR announced a revamped version last month.

Space TV has paid the entry fee of Rs 10 crore, said sources. Also, the application has mentioned that there would be four directors—three from Tata Sons, besides Mr Jagdish Kumar of STAR. The initial investment for the project is estimated to be around Rs 400 crore.

When contacted, officials in the information and broadcasting ministry did not divulge the financial details about the applicant company or the project. “We’re still looking at the application,” said a senior I&B official.

Government would now examine the equity structure of the company, before granting other clearances including those for frequency allocation and satellite platform.

Rival Subhash Chandra-promoted ASC Enterprises soft-launched its DTH project last year. It is claiming brisk offtake of DTH dishes in Punjab hinterland, but remains weak on content. Sony and the bulk of Star channels remain out of bounds though ESPN and Star Sports have finally joined in. Reacting to Star’s entry into DTH at this point, Zee group vice-chairman Jawahar Goel said: “I salute Mr Peter Mukerjea (Star India CEO) for his foresightedness. At a broadcasters’ meeting way back in June 2003, he was of the opinion that CAS should be introduced in July 2004, instead of July 2003. And it has actually come true!”

State broadcaster Prasar Bharati is also expected to enter the DTH market soon.

STAR has always been wary of CAS rollout in India, and keen on DTH. Former STAR CEO James Murdoch had said that “CAS is not a magic bullet....” According to industry insiders, if CAS had been a success in India, there may have been very few takers for STAR DTH. This is more so because CAS was mandated only for the four metros to begin with, and Murdoch’s DTH is eyeing a similar market. In contrast, ASC’s Dish TV is targeting remote areas of the country. However, now, with CAS out of the way, DTH is a different game altogether.

Post-Trai recommendation, government is gearing up to put CAS on hold, ahead of Lok Sabha elections. Law minister Arun Jaitley met I&B minister Ravi Shankar Prasad on Wednesday to discuss CAS.

Mr Jaitley, sources said, has okayed putting CAS on hold. But I&B officials said that consultation with the law ministry is still on.