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TRAI's proposals get mixed response from broadcast players

Industry players today gave a mixed response to broadcasting regulator TRAI's recommendations for increasing foreign investment in the sector.

india Updated: Jun 30, 2010 21:47 IST

Industry players on Wednesday gave a mixed response to broadcasting regulator TRAI's recommendations for increasing foreign investment in the sector.

While multi-system operators (MSO) termed the proposals "balanced", private FM radio operators said TRAI should have also recommended that they be allowed to air news and current affairs programmes.

The direct-to-home (DTH) sector, on the other hand, wanted more from the sectoral regulator.

"This is a welcome step, but increasing the FDI cap is not enough," Dish TV Managing Director Jawahar Goel said.

He said the recommendations should have also made available the option of raising funds through foreign currency convertible bonds (FCCBs) route for the broadcasting sector.

The Telecom Regulatory Authority of India (TRAI) in its recommendation to the Information and Broadcasting Ministry suggested that FDI cap should be hiked to 74 per cent from the existing 49 per cent for MSOs (large cable operators) who are willing to upgrade and digitise their network.

Besides, TRAI has also proposed hiking foreign investment limit to 26 per cent from current 20 per cent in private FM radio, while for DTH, it has proposed a hike to 74 per cent from current 49 per cent.

For local cable operators, it had suggested to bring down the FDI to 26 per cent from 49 per cent.

MSO Alliance President Ashok Mansukhani said : "This is a balanced and welcome recommendation and we hope that the government accepts it as soon as possible."

MSO Alliance is a group of large cable operators, including DigiCable, Digital Entertainment Network, IndusInd Media & Communications (part of the Hinduja Group), WWIL and Indian Cablenet (Essel–Zee Group), Hathway, and SCV Networks.

He said the move would lead to digitisation of cable networks, which will enable to watch more than 100 free to air channels of their choice.

Small cable operators, however said the recommendations will make it more difficult for them to continue operations.

"It will have an adverse impact on the smaller operators, who are looking at growing as they may face difficulty in getting funds," Cable Operators Federation of India President Roop Sharma said.