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Indian MSO Hathway to invest heavily in digital future

Major multi system operator (MSO) Hathway Cable & Datacom is reportedly to invest INR 1.75 billion during the first phase of cable digitisation in India, having already ordered 1.3 million digital set top boxes, with intent issued for another half a million of the decoders.

"We estimate our subscriber universe to be 1.5 million in Mumbai and Delhi. About 20% of this will be second TV sets. We have a presence in Kolkata through our joint venture company and expect to seed 200,000-300,000 boxes there," K Jayaraman, managing director and chief executive, Hathway Cable & Datacom is quoted as saying by Indiantelevision.com.

In Delhi and Mumbai the company has voluntarily installed 250,000 set top boxes. However, in these two metros Hathway is reportedly anticipating a loss of 10-15% of its subscriber base to direct to home (DTH) satellite TV competitors during the first phase of India's mandatory cable digitisation.

While carriage income is expected to decrease by around 30% in the forthcoming digital TV era, Hathway remains confident that some of this loss will be swallowed up by a reduction in the cost of content.

The MSO embarked on an INR 250 million marketing campaign on 6 January, and looks forward to a smoother run during the second phase of digitisation – once the cable networks in India's metro cities are converted to digital transmission.

Cities such as Bangalore and Hyderabad, which fall into the government's second phase of mandatory cable digitisation, are already home to a significant number of subscribers to Hathway's existing digital cable network.

In the long term, digital cable – with its ability to offer triple play services including phone, broadband and television – is expected to offer significant dividends for those players large enough to invest in new technology.

According to Indiantelevision.com, Hathway has INR 2 billion in cash reserves and will manage its first phase investment with a mixture of bank debt, vendor and buyer's credit.

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