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Made in India set-top boxes for below Rs 10,000

Surajeet Dasgupta & Partha Ghosh

Want to surf the Net while watching television? How about those latest European pay channels in the comfort of your home? Now, you can watch television, surf the Net and make your phone calls- all with just one cable running through your house.

Believe it or not, all this and much more will soon be available to Indian customers at an amazingly affordable price of less than Rs 10,000.

A clutch of Indian companies are getting ready to launch the desi version of the integrated receiver/decoders or set-top boxes, an instrument which can receive various types of signals and convert them into audio, video and text.

At the moment, set-top boxes are imported from Hong Kong and Taiwan and cost as much as Rs 17,000-20,000.

Companies like Videocon and Himachal Futuristic are now close to launching their own set-top boxes at an unbeatable price range of less than Rs 10,000 a piece.

Giants like Reliance are also working with R&D companies to develop set-top boxes priced below Rs 10,000, which will be offered to customers using the company's fibre optic backbone.

Earlier Spectranet, the country's first fibre optic backbone service in Delhi, had subsidised the cost and offered set-top boxes at around Rs 12,500 to customers.

And why is there such a scramble for indigenous cheaper set-top boxes? It's because companies have realised that affordability is the key to increasing Internet penetration and providing value-added services on the television in the country.

While the country has between 65-70 million television homes, it has merely 30 million phone connections and barely two million Internet subscribers.

Media and telecom companies feel a large part of the television homes can be converted into Internet and telephone-using homes. This is the market fibre optic backbone players are hoping to tap.

Videocon has already signed an MoU with the Bharti group to supply set-top boxes to the latter's subscribers, once its broadband network is functional. Videocon group chairman Venugopal N Dhoot told Business Standard that the group will manufacture 100,000 set-top boxes from January 2002 at Rs 9,000 a piece.

Another 100, 000 decoders will be manufactured to be fitted in colour televisions, which will also work as a computer.

Dhoot added that his company is already manufacturing 9,000 Internet TVs with in-built decoders every month. "We have developed our own technology at the R&D centre in Aurangabad," he said. Videocon International, the group's flagship company is manufacturing the products.

Says Mahendra Nahata, chairman of Himachal Futuristic group, "The key barrier which we needed to break was the Rs 10,000-mark so that more and more customers will use the instrument. That is what we have now achieved." Nahata expects a market of around 3 million set-top boxes in the next 3-4 years. Prices will fall even further, he says.

So, how does a set-top box help? One, the machines help in converting the Television set for high speed Internet surfing (the computer becomes redundant and the only thing you need is a remote keyboard).

Secondly, for customers who want only one wire in their homes (a facility which will be provided by most fibre optic backbone companies like Reliance and the Mittals), the machine helps in dividing the signals into video, data and voice.

In simple terms, the machine can be used for providing telephony as well as voice over IP once the facility is allowed by the government. Thirdly, the box helps customers to take advantage of facilities like video on demand, or text on demand and pay channels which are not available to normal customers.

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