POWER PLAY: Chief minister J. Jayalalithaa (top) and Kalanithi Maran

Being out of power can have immediate consequences for political families, as the Maran brothers are discovering. The dominance of the Sun group, the media and aviation conglomerate run by textiles minister Dayananidhi Maran’s brother Kalanithi, in Tamil Nadu’s cable TV industry is under threat.

Two rivals loom on the horizon. The first is a state-owned cable TV company, Arasu Cable TV Corporation (ACC), which the Jayalalithaa government wants to revive. Promoted, ironically, by the Karunanidhi government when the Marans were out of favour with the Dravida Munnetra Kazhagam (DMK) patriarch and chief minister in 2007, it was buried after the two families patched up. Cable TV operators who had migrated to ACC returned to the Sun TV network. “Sun was furious with us for going over to ACC,” says G. Damodaran, a cable TV operator in Kancheepuram.

The second is a private venture, Jak Communications. The multi-system operator (MSO) was started by Karunanidhi’s grandson Dayanidhi Alagiri, along with a partner, Jayaram Kamalesh, but Alagiri is believed to have since withdrawn from the company.

Jak obtained an MSO licence in 2008 after investing Rs 50 crore, but started operations only days ago. “We had to fight for three years to get a licence and to get the signal from broadcasters like Sun TV,” explains a Jak official.

The Sun TV Network confronts a third threat too. Cable TV operators, smaller MSOs and broadcasters are eager to end its dominance. “We are paying most of our earnings to one family and that has to stop,” says S.P.K. Goguldoss, state general secretary of the 12,000-member Thamizhaga Cable TV operators’ general welfare association.

The Marans have a presence in the industry though Sumangali Cable Vision (SCV), the Sun TV Network’s cable TV distribution arm. SCV is not just a broadcaster of the popular Sun TV bouquet but an MSO as well.

An MSO receives TV signals from broadcasters such as Zee, Star and Sony and retransmits them to cable operators, who, in turn, take them to homes. As an MSO, SCV collects fees for the Sun TV pay channel from cable TV operators, and charges them for beaming the signals of other channels such as ESPN and Zee. It also charges broadcasters a “carriage fee” which depends on the channels and the placement and can range from Rs 50,000 a year to Rs 5 crore.

Industry sources point out that an MSO can control the order in which channels appear on television sets. If someone wants to underplay a channel, he can push it at the end of the spectrum, affecting its clarity. A TV network which is also an MSO may be tempted to give its own channels prime spots, while sidelining those of its rivals. This is not to suggest that Sun did this.

It’s not clear how many cable TV operators Tamil Nadu has — the Telecom Regulatory Authority of India, which regulates the industry, lists 12,340 cable TV operators in the state, but operators themselves put the figure at 40,000.

The industry is worth some Rs 14,000 crore, says Vidyadhar Khadavkar, chief operating officer of Raj TV Network, but not all the money is declared. “Of this, Rs 250-270 crore is collected by pay channels,” he says. The MSOs control distribution in the cable TV industry. In Chennai, Sun TV has a 100 per cent share of the market, while in the rest of Tamil Nadu its market share is an estimated 60-65 per cent, says Khadavkar. He attributes Sun’s monopoly of the industry to loyal customers and to an innovative billing system for cable operators.

But rivals have accused Sun of hanky-panky. C. Umashankar, the former ACC head who was suspended during the DMK regime but is now the managing director of the Tamil Nadu Handloom Weavers Co-operative Society, displays copies of his letters to the Coimbatore police commissioner urging him not to foist false cases against ACC cable TV operators. And P.V. Kalyanasundaram, managing director, Polimer TV, which has an 8 per cent market share in the cable TV industry, says, “Since Sun TV has all the major TV broadcasters like Sony, Star and Zee with it, it influences them not to give business to any other MSO.”

Emails and phone calls to SCV and Sun TV Network officials to seek comments on all this elicited little response. Vittal Sampath Kumar, general manager, SCV, said he would not “address the press” and does not “understand” the topic.

But DMK spokesperson and Lok Sabha MP T.K.S Elangovan questions the AIADMK government’s move to “nationalise” the cable TV industry. “The government should not create a monopoly; people should have a choice,” he says. But isn’t SCV being accused of exactly the same thing, namely, monopolising the market?

“There are other MSOs apart from SCV but they do have a smaller share,” he replies. “Sun TV has a larger share of the market because it launched the first Tamil channel and built up its market by offering more channels. It is the people’s choice.”

The ACC will run a cable TV operations network in the state as an MSO and provide a cheaper alternative to subscribers. “They earlier only had the free-to-air channels with them because the pay TV channels refused to come on board. The cable TV operators were caught in the middle because we really did not know which way to go,” recalls D.G.V.P. Sekar, president of the Federation of Cable TV Associations, south India.

Indeed, cable TV operators are in a quandary once more. “If the government is serious, it should set up a committee to examine the matter. If not, we don’t want to be caught up in cable TV wars again,” notes Sekar. One way of making ACC successful is to start talks with pay channel broadcasters immediately, he adds.

Yet the government clearly means business this time. “We are talking to experts right now to make sure we can work out a foolproof plan,” says a government source.

Former ACC head Umashankar believes it has a bigger chance of succeeding now. “The government has the support of all the cable operators who’re tired of SCV’s monopoly,” he says.

Yet the going for ACC won’t be easy, because cable TV is a central government subject. In 2001 and 2007, Jayalalithaa introduced two bills to take over the state’s MSOs, particularly SCV, but was prevented from doing so first by the Madras High Court and then by Governor S.S. Barnala, who said the matter was a central subject.

DMK’s Elangovan says the ACC should compete with private players in the open market with a sense of “fair play” and not indulge in bullying tactics. He suggests it call all private players to the table and regulate prices. “That is one way of controlling any one company from monopolising the market.”

But with Jak poised to enter the market with competitive prices, it remains to be seen whether a setting sun is more emblematic of the Sun TV Network than a rising one.