The ?idiot box? in your homes is all set to smarten up, with the mandatory digitisation diktat by the central government, granting it several generations of intelligence in the next six months. With the help of a ?smart? digital box, otherwise known as a set top box or STB, the TV set will become a two-way communication device. This transformation will initially begin in the homes of around 12 million cable TV consumers, in Delhi, Mumbai, Kolkata and Chennai, in the next six months and ultimately cover all the 90 million-plus cable homes in the country by 2014.

While the cable television available today via the old copper wire cables can offer just 60-70 TV channels, with a bulk of poor video and audio quality, digital cable will offer a lot more than mere TV channels. The pipeline of channels coming to your home under digital cable will go up to over a thousand. And that?s not all. There will be video on-demand services (without a telephone line), telephone services, high-speed Internet and interactive television services, something which cannot be matched by the direct-to-home (DTH) service operators. In addition, digital cable technology allows for error correction to ensure quality of the received signal and uses a secure digital distribution system.

This would mean TV would offer not merely channels, but high-speed Internet services, and maybe unlimited nationwide calling, like in the US or the UK. Experts say with these services the concept of landline telephones may also disappear, giving way to a highly secure, high-speed Internet-based telephone service that will come with the monthly cable bills.

?Already, cable distributors are looking at importing advanced digital STBs from China and Taiwan that can offer two-way connectivity. Therefore, high-speed Internet offerings, along with cable channels and digital video recording storage facility, may all come in bundled together in one single STB,? says Vineet Wadhwa chief technology officer, Logic Eastern India, a high-end STB manufacturing firm.

In fact, two years ago, Logic Eastern had developed special digital STBs that came with an in-built patented hardware to enable connections to Gmail, Facebook and YouTube via cable TV connections. The company also has ICICI as an investor, which bought a 20% stake in it. With digital television coming in, the challenge for such local STB manufacturers is how to provide differentiated products, so as to attract more consumers to digital cable TV services as opposed to the now popular DTH services.

All stakeholders in the broadcasting and cable business, including cable distributors, broadcasters and cable operators, have welcomed the government-mandated ?must digitise by 2014? order. Tarun Katial, CEO, Reliance Broadcast Network, feels digitisation will bring in fair reporting of the subscriber base, leading to standard pricing. This will help do away with local monopoly. ?Digitisation will also increase the subscription revenues for operators and reduce carriage fee for broadcasters in a phased manner and should help margins in the long term,? Katial adds.

MG Azhar, COO, DEN Networks, feels digitisation will create a paradigm shift in the pay distribution industry and alter fundamentals of the media sector. ?The move to full digitisation with addressability will benefit all stakeholders in the value chain, from consumer to service providers to broadcasters and the government. The transition will see the entry of more channels, the spread of broadband and triple play offerings and ultimately a transformation in how households consume content and entertainment in this country,? says Azhar.

Why is digital cable better?

Efficiency: Digital cable technology allows cable providers to compress video channels so that they take up less frequency space and also offers various two-way communication capabilities. Digital cable channels typically are allocated spectrum between 552 and 750 MHz and beyond.

Offerings: Consumers will be empowered with a whole host of choices between high-quality premium content like high-definition channels, movie library, national and regional channels and high-speed Internet, educational and informative content for children, games and interactive programming among others. Of course, Internet telephony will be an added bonus along with the cable box to act as a recorder to store your favourite shows.

Convergence: Triple-play will kick in a real sense with digitisation of cable services, experts say. This means pictures, data and voice will all be rolled into your TV sets via an advanced digital STB. Radio stations from around the world will be available on your TV at the click of a button. Advertisers will have new avenues to earn money. There will be specialised channels for shopping, where with a push of a button on your remote, the product details along with video content will be available.

What are the cost implications?

Consumers: As far as digitisation goes, consumers will have to incur a small cost. And mainly it will be towards the smart digital STB. The large and organised cable firms are planning to offer these STBs at either an outright purchase or on monthly rentals. There will also be a deposit scheme under which consumers will be provided the STB in lieu of a small monthly fee.

Cable Companies: At least $200 million or R1,000 crore will be required by organised cable firms to digitise the 12 million analogue cable homes across the four metros. Overall, the figures swell up to R30,000 crore. According to Media Partners Asia (MPA), a leading international media research firm, among Hathways, DEN and WWIL, around R560 crore of investments will be required in the four metros towards digitalisation. Hathways will have to digitalise 1 million subscribers while DEN and WWIL will need to provide digital STB to 1.7 million and 1 million, respectively.

As a first incentive, instead of the cut-off date of March 31, 2012, now the cut-off date for digitisation of the cable homes in four metros will be June 30, 2012, official sources said. This means large cable firms will now have seven months to plan out their investments and other requirements for the four metros.

When and where of digitisation?

The information and broadcasting ministry has set December 31, 2014 as the deadline for shifting analog sysytems to digital systems. Digitisation, where the feed will be received through set-top boxes, will be executed in phases and the four metros of Delhi, Mumbai, Kolkata and Chennai have to shift to digital addressability by June 30, 2012. Phase II will include 35 cities with a population of more than one million, such as Patna, Chandigarh, Pune and Bangalore, which should happen by June 30, 2013. All areas are expected to digitise by the end of December 2014.