Cables a Charmer in Rural India

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New Delhi, India -- Cable-television subscriptions outside
of India's major urban centers are increasing rapidly, according to a recent study and to
industry estimates.

Over the past two years alone, cable subscriptions in rural
and semiurban areas have grown at an annual rate of 11 percent, according to recently
released data from Organised Research Group-Marketing and Advertising Research Group
(ORG-MARC), India's leading media-research firm.

From 1997 to 1998, cable added 440,000 new rural homes -- a
feat made more notable by the fact that just three years ago, cable barely existed in such
areas.

ORG-MARC based the study on a survey of 2,965 small towns
and villages. The study found urban cable penetration standing at about 44 percent and,
according to industry estimates, it's growing at about 4 percent to 5 percent per year.

India has about 60 million TV homes, 33 million of which
are urban and 27 million of which are rural, according to state broadcaster Prasar Bharati
Corp. Nationwide, India has about 20 million cable homes, according to PBC.

Overall, industry estimates placed the semiurban and rural
cable subscriber base at about 7.8 million homes.

Much of cable's nonurban growth is coming in southern
India, as viewers opt for programming that they find more relevant than PBC's DD-1 and
DD-2 broadcast networks, which have a northern bias.

"Southern subscribers find these [channels] culturally
alien, and they have opted for customized programming," said B.S. Chandrashekhar,
head of PBC's research unit.

Eeanadu TV, a Telugu-language channel in the southern state
of Andhra Pradesh, is one of those programmers seizing the opportunity to grow by
delivering what viewers want. Bapie Needu, its general manager, said that in 1995, Andhra
Pradesh had only 500,000 cable homes, none of which was outside urban areas. Today, the
state boasts 4.7 million cable homes, 2.73 million of which are in rural areas.

To be sure, cable has also received a hand from local
governments. In Bastar, a southern state with about 2.5 million residents, a government
agency known as the Corp. for Development of Backward Classes has provided seed money to
hundreds of small operators to start a 12-channel service, said V.C. Khare, strategic
planning director with Shyan Telecom, a large Indian telecommunications-equipment company.

"Many operators opened up shop with as few as 50
subscribers, initially covering an operational radius of one kilometer," he said.

Despite the government handouts and small-scale operations,
rural operators are showing some business acumen. For starters, they're keeping monthly
fees low in order to attract and retain subscribers.

"Operators have deliberately kept subscription rates
in these areas as low as 50 rupees [$US1.20] per month, so that villagers find it
affordable," said Roop Sharma, president of the Cable Operators Federation of India.

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