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Den Networks to invest INR1,000 crore on cable digitisation

Indian multi system operator (MSO) Den Networks plans to invest INR 1,000 crore over three or four years to roll out its digital cable TV and service in India, according to Reuters.

The Government last week approved plans to digitise the expansive cable network of India by the end of 2014, beginning next year with the major metros New Delhi, Mumbai, Kolkata and Chennai.

INR 400 crore will be utilised by Den to install the first phase of work on its digital cable network, which it hopes will grow subscribers to its pay-TV service. "We are hoping to add 2.5 million subscribers in the first phase. If all goes well, we plan to finish the first phase by April 2012," said S N Sharma, president, Den Networks.

The company has a total of 10.5 million subscribers, and has been adding 700,000 subscribers a year to its cable TV service, according to the report.

The first phase will be financed by a 50:50 mix of internal accrual and debt. The company also plans to launch broadband services alongside digital television.

Some industry experts, including the Den Networks president, expect there will consolidation in the cable industry in the run up to digitisation.

"Consolidation will happen automatically. And there will most definitely be some consolidation by a merger, acquisition or by some operators getting locked out in the next three years," said Sharma.

"We have been in the process of consolidation of LCOs (local cable operators) and are open to and considering MSO consolidation opportunities, he added.

Rival MSO Hathway recently announced it would invest between INR 500-600 crore by 2014 on digitising its cable TV network, with INR 700-800 being spent in its first phase of works.

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