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Heavyweight Measures

Panic grips the nascent industry as the proposed Broadcasting Bill talks though

Heavyweight Measures
outlookindia.com
-0001-11-30T00:00:00+0553

Information and broadcasting minister S. Jaipal Reddy, as pragmatic a man as any, knows precisely what he wants: complete autonomy for the 'official' media and total freedom for private entrepreneurs in broadcasting. That, on paper, is the avowed intent of the Broadcasting Bill which he introduced in Parliament on May 12 and placed before a 30-member joint committee for a thorough discussion. But are its provisions quite in keeping with the Bill's purported objective-regulation of broadcasting in India by a completely independent statutory authority? The debate that the minister has sought promises to be extremely bitter as I&B ministry officials, Indian newspaper barons, media buccaneers and foreign broadcasters slug it out in the weeks ahead and punch holes in this sensitive piece of legislation which will define the future of broadcasting in India.

While private broadcasters, Indian and foreign, are agreed that the Bill is long overdue, few are sure that this s what they had bargained for. In its current form, the Bill is a document in desperate need of an overhaul. After all, myopic bureaucrats, functioning out of Shastri Bhavan's musty cubby holes, are hardly competent to frame the rules of the game. "Are they aware of the situation on the ground?" asks an indignant media player. "They've filched one idea from the US, one from the UK, one from Canada, one from God-knows-where and mucked it all up." The anger, especially among foreign broadcasters, is palpable, especially about the clause that places a 49 per cent limit on holdings by an alien company in a broadcast venture.

Says STAR TV's Urmila Gupta: "The reach of the foreign channels is limited. Restrictions on ownership are, therefore, meaningless-they should be linked to measurable parameters like audience share." In trying to prevent monopolies, what the government is doing is actually curtailing choice, plurality, better programming. "The viewer will be the worst-hit," says Gupta.

Nobody, however, disputes the fact that the Bill is a necessity. Says Gupta, who heads STAR's direct-to-home project: "We welcome the Bill because it will lay down the ground rules." According to P.C. Lahiri, vice-president, Zee Telefilms, regulation is the need of the hour. "It will lead to a greater inflow of funds as private TV players will be able to take loans from global financial companies," he says. And Price Waterhouse's Deepak Kapoor, a media and communications expert, feels that "the objective of the Bill is all right, but the way it is being sought to be implemented is wrong". Comparisons with the US, he says, are gratuitous because the growth of the TV industry there was powered by local broadcasters, unlike in India.

The Broadcasting Bill, of cause, is in response to the February 1995 Supreme Court directive that the airwaves are public property and should, therefore, be regulated by an independent statutory authority to prevent monopolies and protect the viewers' right to access a range of services, programmes and views. "Airwaves constitute public property and must be utilised for advancing public good," Justice Jeevan Reddy had ruled in the celebrated Union of India versus Cricket Association of Bengal case. "From the standpoint of Article 19(1)(a), what is paramount is the right of the listeners and viewers and not the right of the broadcaster-whether the broadcaster is the State, a public corporation or a private individual or body."

The right of the viewer to access what he wants to hear or watch should be central to the debate. Unfortunately, that is not happening. The restrictions that the Bill proposes to impose on broadcasting, including that rather dubious weapon called licensing, fly in the face of the stand intent of the Bill. That is precisely what the foreign broadcasters, companies which spearheaded the electronic media revolution in India and created a Rs 10,000-crore industry in next to no time, are keen to expose. The proposed 49 per cent cap on foreign equity participation, mandatory uplinking from Indian soil and restrictions on intra-media holdings, they say, will compel them to roll back their investments in India. "The Bill is clearly the handiwork of inept section officers of the I&B ministry. It's completely devoid of vision," says a veteran media-watcher. "If the Bill is passed, we will have to pack up and leave," says Urmila Gupta.

Will the foreign channels be given a hearing by the joint parliamentary committee? "I would certainly hope that the minister and the JPC will seek the views of all stakeholders in this important industry," says Kiran Karnik, chief operating officer, Discovery Communications, India. His own views, of course, are unambiguous: "Most of the satellite channels have been losing money. They have taken the risks inherent in venturing into a new market. Now when they are poised to take off, they will have to sell off their majority share to a party that bore none of the early losses."

The American and British players are gearing up for a long and fierce battle to protect their turf. The US companies have set up an informal committee to draft an alternative Bill. Jaipal Reddy, of course, has asserted that he will not push the Bill through without a proper, meaningful debate. "It's only a working draft and none of its clauses is sacrosanct," says the I&B minister. All eyes will, therefore, be on the JPC, which is unlikely to hold its first meeting until mid-June because many of its members, including chairman Sharad Pawar, are busy with their party organisational polls.

Is there hope yet? Media observers are sure that the curbs relating to cross-media ownership will be removed under pressure from Indian newspaper barons who have plans to diversify into the electronic media. In fact, K.K. Birla, Rajya Sabha MP and owner of The Hindustan Times, which has a 30 per cent stake in Home TV, is himself a member of the JPC. He is expected to fight tooth and nail against both cross-media and intra-media ownership restrictions. The Bill stipulates that a company which is granted a license in one TV or radio service cannot own a license in another service category. For example, Zee TV, when it gets a license to run a satellite TV network, will have to give up its shares in SitiCable, its ground distribution division. Or STAR TV, if it secures a dth license, will have to withdraw from satellite TV services. Says P.C. Lahiri: "If you debar established media houses from one service or another, you cannot expect healthy, mature growth, There will be too many new players for the good of the industry. Ideally, there should be a mix of the old and the new."

BUT Zee TV, which is alleged to have influenced the formulation of the Bill, thanks to Subhash Chandra's proximity to former I&B minister C.M. Ibrahim, is in favour of virtually all other provisions of the Bill, including the proposed auction of licenses and the uplinking from India. "You cannot deny the government the right to earn revenue from services that will bring their providers crores of rupees," says Lahiri. "Setting up an uplinking base in India will involve only a one-time investment, but the spin-offs will be huge in terms of improved infrastructure and increased employment. Moreover, it will save the nation precious foreign exchange, which goes out by the way of payments that Indian broadcasters make to foreign set-ups to use their facilities."

But should foreign players be coerced? Says Karnik: "When we wee beginning operations here, Discovery was keen to use a transponder on INSAT (which would have meant uplinking from India). Since this request was not acceded to, we had to uplink from Singapore, where we now share facilities with other Discovery Channel feeds (to Australia, Taiwan, Indonesia, etc)." As a result, he says, a shift at this stage "will certainly entail considerable incremental expenditure".

Another important aspect of the Bill which is causing widespread worry is the fact that the I&B ministry babus will continue to exercise control over the proposed Broadcasting Authority of India (BAI). "What the Supreme Court ordered was an independent body to regulate the airwaves. But the Bill proposes an authority that will rely heavily on bureaucrats for its functioning." says a media observer.

Supporters of the Bill argue that restrictions on foreign equity are a common practice in the world's leading democracies. So why is such a hue and cry being raised about asking foreigners to give up management control? Bureaucrats argue that the idea is to shield Indian ventures against takeovers by foreign companies: the figure is immaterial, what's crucial is that control remains in Indian hands. That's specious argument, insist media observers. If foreign companies are compelled to reduce their stake to 49 per cent, they will lose interest and leave, as Coca-Cola and IBM had done in the late '70s, putting India's soft drinks and computer industries back by several decades. Will the same fate befall India's burgeoning broadcasting industry?

Today, India is at the cutting edge of broadcasting technology. An enabling regulatory mechanism, not a restrictive regime, is what the industry needs. The more players there are, the better. For there can be no better regulator than competition. Jaipal Reddy knows that. But will he have his way?

 

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