Thursday, October 13, 2011

Governmenrt asks TV channels to go digital

The TV channels consider it a Big Brother act, but the government argues that asking the TV channels to go digital is for their (channels') own good. The argument that Information Broadcasting Ministry is offering is that digitisation will change the business model of running a channel. First, digitisation will help the channels to reduce their carrying charges which now stand at 65 per cent of their budgets and leaves them a mere 35 per cent for generating content. Second, digitisation will also change the revenue earning pattern of the channels as well. At the moment, the channels earn 65 per cent of their revenue from advertising and 35 per cent from subscription, That is why, all channels will now have to chase the TRPs. Digitisation will overturn this pattern, with subscription revenue rising to 65 per cent and advertisement revenue falling to 35 per cent, which is the pattern in other countries of the world.

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