“3G is passe’,” JS Sarma, Chairman of India’s Telecom Regulator TRAI said at the CII Content Summit on Friday. “The pace of change is such, and the magnitude of change is such that one needs to run to stay in place. This seminar is about content, but the nature of content will also change with the nature of carriage. 3G is being rolled out, but the good thing is that the switchover from 3G to LTE is mostly software driven, so that the switchover is easier as compared to 3G from 2G.” The TRAI expects 4G-LTE to be launched shortly, by next year, and Sarma said that the TRAI expects to finalize its 4G recommendation by June.
During the conference, Sarma pointed out that Mobile Value Added Services are likely to drive growth – for some companies(ED: Tata Telesevices Maharashtra, for one), they already account for 15-16% of revenue, and the fields in which the telecom companies will enter are going to vary: “In many cases they’re tying up with banks. Value added services are going to be a very very significant element of our communications. TRAI is going to come up with a consultation paper on VAS.”
On Content And Internet Regulation
“In terms of content, how do you control the internet? That is baffling and challenging, and it is frought with issues of freedom and security. Security in terms of physical security and others. This will have to be studied over the course of next few months or the next year or so,” Sarma said during his talk.
Sarma mentioned the role of connected devices in the changing devices environment for content consumption, and acknowledged the role of tablets, but hastened to add that he doesn’t believe tablets will be the primary form.
“The nature of content will go for a significant change. Just as in terms of regulation of carriage, it will become more complicated, and we’ll need light touch regulation for both carriage and content – the regulators will have to move towards lesser and lesser regulation.”
Sarma expects that there will be no need for price control (for DTH) with digitalization of content: “Today, there is a price control. Why? because this is just to protect the end consumer from being charged arbitrary prices. With digitalization, you give the customer their choice of channels, and there is no need for further price control.” This is particularly significant with a schedule for a sunset for Analog services being announced by represenatives from the Ministry of Information and Broadcasting.
On Media Business’ ROI And The Need To Evolve
Referring to a recent Boston Consulting Group report, Sarma pointed out that “between the tech, media and telecom companies, the total return to shareholders recorded was found to be the least for media, and compared to an average score of 6.6 average, media was around 2. This indiactes that traditional media companies will need to innovate their own business models to take the best advantage of technology and communications. One finds that mixed (media) houses, which have more than one of these three components perform better than purely media companies. You’ve seen Google TV and Apple TV. You’ve seen Naspers growing from a typical newspaper house into a complex multimedia business. This is how the world is changing. Wisdom lies in anticipating changes, including anticipating regulatory policies, pricing policies.”