Indian telecom firms, seeking to increase revenue and stimulate demand by offering internet Protocol Television services, face hurdles of high costs, low broadband usage and slow speeds, industry executives, quoted by a Reuters report, said.
'The interactivity in IPTV opens up a new platform for advertisers, which translates into higher revenues per user for the telecom firms,' Aksh Optifibre's managing director, Kailash Choudhari, quoted by the Reuters report, said.
State-run MTNL and BSNL are the only companies which now offer limited IPTV services, or television or video signals over broadband, the report said.
Bharti Airtel is expected to roll-out its services shortly, while Reliance Communications in November announced a $500 million pact with Microsoft Corp for IPTV services in India.
IOL Netcom and Aksh Optifibre are battling high costs as television broadcasters charge telecom companies much more than cable operators for program feeds.
The Reuters report also quoted said IOL director A.S.Oberai as saying that 'we are paying through our nose - paying a big amount to the broadcasters for each territory,'
MTNL's executive Director, J. Gopal added that 'our franchisees are finding it difficult to get TV feed at the same rates which they provide to cable operators, with the result it is becoming more expensive for us.'
Broadcasters are looking for minimum subscriber guarantees, the report said.
Any shortfall in subscribers has to be made good by the service provider, adding to costs, said Aksh's Choudhari.
Broadcasters 'need to be assured of revenues before offering our content,' said Ishwar Jha, CEO of Digital Media Convergence, which distributes content from Zee Entertainment and Zee News to alternate media platforms.
Another big hurdle to popularizing IPTV is the low broadband penetration, the report further said.