The monopolist and a competitor – the Russian Broadcasting Network, is trying to subjugate the cable operators. This is one more reason for the loss of customers, who are already flowing into the Internet. In the fight for business, the largest providers plan to introduce new technologies to broadcast the World Wide Web.
Since the beginning of its formation, the market of cable and satellite Pay TV in Russia has been one of the most free in the meaning of government regulation. The main provisions of the law “On Communications” satisfied both the state and broadcasters and, what is the most important, – viewers. The market has grown an average by 20% per year and reached 61 billion rubles in 2014. The number of subscribers increased by 7% compared to 2013 reaching now 37.5 million, 21.9 million people of them – the subscribers of digital television, which is especially rapidly gaining momentum in recent years, informs expert.ru.
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Nevertheless, 2013th was the last quiet year in the life of Russian TV cable operators. Fearing the loss of the advertising revenue, the major channels lobbied (former management of “Gazprom Media” drove it most of all as it considered to be) the law prohibiting Pay TV channels to advertise, although they collected only 2.7% of the market. 100 of the 270 television operators, mostly regional, were almost under the threat of stopping activity. However, from the beginning of the year this thundercloud was posing the threat to the Russian Broadcasting not more than for a month – recently the status quo was restored by a presidential decree.
Going to the state monopoly
Now the market is approaching to a new cable television storm. The government has made to the Duma draft amendments to the law “On Mass Media” and “On Communications”, which can’t solve the problem of serene market, but more over they can create new ones.
In the case of the amendment as it stands, cable operators will be forced to build by themselves unnecessary and expensive communication lines to receive by wires signals from the Federal State Unitary Enterprise “Russian Television and Radio Broadcasting Network” (RTRS, as it sounds in Russian). The state enterprise is responsible for the development of digital television, and on this pretext, it wants to subordinate, in fact, all “cable operators.”
“The proposed wording makes to be illegal obtaining by operators the signal directly from the studios of broadcasters, which is widely practiced currently in Moscow with the aim of improving the quality of broadcasting, – said VP Mikhail Silin, ACTR. – In fact, the bill involves the replacement of the scheme broadcaster – operator – subscriber to operator – operator – subscriber. Nevertheless, an additional cable between the operator and the subscriber – this is an additional risk of damage in the open space, the risk of failure of the technical services in the stations of RTRS themselves”.
Dividends for competitors
As RTRS also is a TV provider, the operators have to negotiate about the connection of cable TV with a competitor, in fact. No one has any illusions that these conditions will be gentle, though RTRS claims otherwise.
“RTRS is the only country’s network operator to guarantee the dissemination of TV signal, and there is nothing to talk about the competition with cable operators, – the deputy head of RTRS, Vitaly Stytsko does not agree. – We must ensure the full digital reception everywhere, but it is expensive. Moreover, while many channels take the signal from the air, it’s not available everywhere. For example, in some regions of Siberia, the Amur region, Baikal, RTRS is the only signal source, for cable operators as well”.
The struggle for viewers
In addition to the threat of over-regulation of the industry, of course, owners and providers of television faced with the need to make efforts for surviving in the current environment of ruble devaluation and demand reduction. The attractiveness of the cable TV package will decrease – due to the new requirements of the law again. Previously, the cable TV operators were required to include in their free packages 20 mandatory federal channels (1st and 2nd multiplexes), it’s has appeared more “free channels” since this year.
“Frequent changes in the law limit investments – said General Director of “Pervyi HDTV” Nikolai Orlov. –The investors say, all this is interesting, but it is unreliable, this is why we are investing our money in the wood industry, not in TV”.
General Director of Sony Pictures Television Networks Sergey Plotnikov also doubts that the creation of the Russian content will impress investors.
The head of ‘’Digital TV’’, Kirill Lysko is ready to bet with him, the investors not so far put money in the channel “Nasha Planeta” and have already earned profit. Now we are even launching a new TV channel “Zhyvaya Planeta”. Russia is one of the few countries, which are able to invest in educational channels, which are still deficit. ”
The market pushes to the new technologies
BBC, CNN (according to the last information it is coming back) have already left Russian cable operators, the channel Universal announced the same intention. However, other international channels are still ready to fight for the Russian audience.
“Russia is a strategically important market for us, so we are going to invest in the production of content in Russian” – confirms the general director of «Discovery Networks-Russia” Olga Pascin.
All the cable TV operators forecast that legislative and market challenges will lead to leaching of foreign broadcasters from the “cable” and, therefore, the subscriber base will narrow. The viewer will find the necessary channels or movies on the Internet.
Another thing is that very few subscribers in Russia have modern TVs, allowing you to watch Internet broadcasters (Smart TV), as well few of them are willing to watch constantly the cable TV or airchannels by computer (OTT).
