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Financial Express [ May 16, 2003 ]
With decoder market growing, could Indian manufacturers be far behind?
Nivedita Mookerji
New Delhi, May 16: Just when we thought that foreign boxes would herald the conditional access system (CAS) in India, the 'indigenous' lobby has raised its pitch for saleability. Even as multi-system operators (MSOs) or the cable biggies are dishing out significant import order figures, indigenous manufacturing of analog decoder boxes is emerging as an alternative. Post-CAS, cable TV viewers will need decoder boxes to watch the pay channels.
Among the pioneers, Noble Group managing director Sarabjit Singh says that he has already got order for around 50,000 analog set top boxes from cable operators in the country. But he clarifies that the chip and some other components such as tuners for the boxes will be imported. The chip/technology for the Noble boxes is coming from Singapore's SPL Innotech. Noble is manufacturing the boxes in India, which is different from assembling, Mr Singh says. Assembling refers to importing components in semi-knocked down (SKD) state and then putting them together. Noble has been in the television manufacturing business for several years now.
"We have bought the technology from Singapore's SPL but we cannot sell it further," says Mr Singh, without disclosing the price at which the deal has been struck. Noble has given a commitment for at least 1.5 million units to SPL. The timeframe for this volume has not been specified, according to Mr Singh. SPL will continue to give technology support to Noble, as per the deal.
Others like UK-based Dalvi has tied up with a company in Mohali to assemble boxes in the country. Also, Taiwan-based Eastern is exploring assembling and distribution options in India.
 We have bought the technology from Singapore's SPL but we cannot sell it further 
Noble Group managing director
Sarbjit Singh
An industry consultant, Mr Arvind Kharbanda, even brings in the SARS perspective to back Indian manufacturing of boxes. With around 75 per cent of the global set-top boxes being made in the Far-East, some of which are SARS-affected such as China and Hong Kong, there's a clear case of manufacturing starting in India in a big way, according to Mr Kharbanda.
With Indian manufacturers joining the bandwagon, up to 70 per cent of the CAS market may go for analog boxes, according to Mr Singh. But, Mr Kharbanda takes a more conservative view and puts his estimate at 40 to 50 per cent analog and the remaining digital in the first phase of CAS. He adds that analog numbers will go up as non-metros roll out CAS.
These numbers might look somewhat unreal, keeping in mind the fact that MSOs have about 4 million cable and satellite homes under them in metros, out of a total of 6 million C&S households in the four cities, and that most of them are importing digital boxes. But, industry sources indicate that the cable market is witnessing a churn and a lot of breakaway groups are expected to come out of the MSO hold. For starters, Mumbai is already experiencing a split on the MSO front, where some Hinduja TMT franchisees have started giving feed to viewers as independent entities.
From the government side also, indigenous manufacturing seems to be getting a boost. That is, the government refused to consider MSOs' demand for import duty slash recently. Apparently, to encourage the domestic players!
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