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Media: Digital vs. Analog - Views on News from Equitymaster
 
 
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  • Sep 10, 2007

    Media: Digital vs. Analog

    In the previous article we had explained the TRAI guidelines for the rollout of DTH services and its impact on the DTH operators, broadcasters and the viewers. In this article, we shall delve into the different technologies of digital transmission namely CAS and DTH and the advantages of digital transmission over analogue transmission.

    Conditional Access System (CAS)
    CAS can be implemented in either analogue or digital mode. Under CAS, the local cable operator (LCO) installs a Set top box (STB) at the subscriber's end. The STB keeps track of the channels viewed by the subscriber. A subscriber management system at the Multi System operator's (MSO) facility, ascertains subscriber volume. Thus, with the implementation of CAS, LCOs will not be able to under-declare subscriber base and revenues.

    Direct to Home (DTH)
    DTH technology can deliver television signals directly to the consumer via satellite, thus eliminating the LCO. For the subscriber, the difference between DTH and the traditional cable is hardware costs, apart from the quality of transmission. In a cable system, the user pays a one-time connection fee followed by monthly rentals, while in DTH, one has to invest in the STB. DTH can be offered even in interiors, where laying a cable wire would not be feasible. Currently, there 3 players in the DTH market. They are DD Direct (Doordarshan's DTH service), Dish TV (part of Zee group) and Tata Sky (JV between Tata group and Newscorp). Others intending to enter the DTH market are Bharti Airtel, Reliance ADAG and Sun TV. With a larger number of players, subscription volumes will increase. The PWC-FICCI report on the Media and Entertainment sector expects the total number of DTH connections to increase to 10 m by 2010.

    Digital vs. Analog Transmission

    Ability to transmit greater number of channels: Analogue systems are choked due to the increasing number of channels. With digitalization, cable operators will be able to offer a wider choice. Video compression allows up to 12 digital TV channels in the bandwidth of one analogue channel (Source: CRISINFAC). The additional channels will also promote healthy competition among broadcasters.

    Quality of transmission:The picture and audio quality of the digital system is better.

    Provision of interactive services: Most cable television networks in India do not currently incorporate a reverse path. They only deliver signals downstream, that is, from the head end to the customer. Digital networks can create two-way links with subscribers and provide interactive services.

    High-end programming: With digitalisation, it will be also possible to provide programmes in the high definition television (HDTV) format. HDTV provides a wide screen presentation, similar to that seen in theatres.

    Thus digital transmission has a lot of advantages over analogue transmission. It will benefit all the stakeholders namely the broadcasters, viewers, content providers, MSO's and the LCO's. The transmission quality will improve and the monthly cable bills of the viewers can be budgeted as per requirements. The broadcasters subscription revenues will increase substantially going forward increasing their ability to spend on content. The MSO's will also gain, as their share in subscription revenues will increase. The local cable operators will benefit in the long run as the average revenue per user (ARPU) increases. Thus, digitisation is the way forward for the Indian television broadcasting sector.

     

     

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