MSOs to begin direct billing for digital cable consumers from August

In a significant step aimed at ushering in transparency in the way cable TV consumers are billed, the multiple system operators (MSOs) are rolling out a direct billing system from August.

As of now, the monthly charges for cable TV connections were being collected by the local area cable operators, who were subsequently passing on the payments to the MSOs. However, the current system was often found to include differential pricing to different customers for same package and in many cases the payments did not include taxes.

The MSOs have now decided to implement the 'direct billing system' to remove any arbitrary pricing and to ensure that the charges are strictly in accordance with the package. "This is a revolutionary step by MSOs and will bring in absolute transparency in the way consumers are charged," leading player DEN Networks' CEO S N Sharma said. "We will generate bills and send them directly to consumers. Since the consumer knows the package he has chosen and charge per channel, he or she will get the right bill," he said in a statement.

The other leading MSOs include Siti Cable and Hathway. The direct billing is being launched in Delhi and Mumbai this month and will be subsequently rolled out in other parts of the country. The move to begin direct billing for digital cable TV subscribers by their respective MSOs follows a successful completion of their KYC drives.

As per TRAI directive, if consumers do not pay their bills after the new system comes into place, the MSOs would have the right to disconnect the cable services. The MSOs also plan to launch an awareness campaign to make the consumers aware about the new billing system.

The move could be of significant benefit to the MSOs, who would now get actual revenues as per their customer base and the packages on offer, as the earlier system of billing by local cable operators left room for pilferage. Besides, the direct billing system will also help the government realise higher taxes, as the tax payments would be collected on each connection. The MSOs are now looking to complete the cable TV digitisation across the country, the deadline for which is September 2014.