The editors of channels feel that they may not have much work to do, once the content code is in place. But the ministry has a different opinion. Asha Swarup, secretary, Ministry of Information & Broadcasting said, "It was incorrect to say that India was the only country that was proposing to have a content code for the broadcast sector, as such codes in different forms were in existence in other countries. "Within the country itself, there has always been a program code and an advertising code as part of the licence conditions for the service providers to abide by," Swarup added.

G Krishnan, executive director and CEO, TV Today Network said there is no need for any regulation as the existing guidelines are adequate. "India is a powerful democracy and it is the media that should be the auditor of content, not a regulator," he added.

Areas which will come under the regulator's scrutiny, such as content, cross media ownership, subscriptions and live sports feeds would call for a major corporate restructuring by media companies, foreign and domestic, operating in India, with serious financial implications for them, according to FICCI.

	"It was incorrect to say that India was the only country that was proposing to have a content code for the broadcast sector"
	-Asha Swarup secretary, Ministry of I&B
	"In the end the most affected stakeholder is the viewer, the ordinary citizen"
	-Chintamani Rao chief executive officer, India TV
	"India is a powerful democracy and it is the media that should be the auditor of content, not a regulator"
	-G Krishnan, executive director and CEO, TV Today Network

Bill Needs De-bugging
Everyone in the industry wants to change the bill as several anomalies are bugging the industry. The reasons are multi-fold.

Firstly, with or without such a law, broadcast has been discriminated against, relative to print. Advertising on TV is subject to service tax, while that in print is not. And secondly, surrogate advertising, as for liquor products, is allowed in print but not on television.

The government may be looking to prevent vested interests from gaining control of broadcasting and thereby influencing its content. But ostensibly so, as India already has an MRTP Act as well as a Competition Act, under which there is a Competition Commission to prevent this sort of an outcome.

Media businesses need large capital investments, and involve long gestation periods, which limit entry and sustainability. Industry experts feel that arbitrary limits in the proposed bill will make the media business commercially unsustainable for many. As a result, the broadcasting industry will end up with a few dominant players that have the financial muscle to stay the course and in turn defeat the very purpose of such a restriction. AP Parigi, MD & CEO, Entertainment Network India, said, "Broadcasters are against the cross-media restrictions and sectoral caps. This would completely stunt the growth of the industry unless it is allowed to go global."

Echoing the same sentiment, Amit Khanna, chairman of the FICCI Committee on Convergence and chairman, Reliance Entertainment, said, "The government should a take a re-look at cross-media restrictions. The sector equity cap is the worst form of piece-meal legislation."

No Room to Play
Cap on cross holdings has been vehemently opposed by the industry as this will have a direct impact on the growth of the industry as broadcasters are actively looking at growth through merger and acquisitions.

There will be a 20% cap in cross holdings between broadcasters, between broadcasters and network operators like cable and DTH, and with FM operators. This means any merger/acquisition involving equity transactions of more than 20% stake, between two broadcasters (Sony-SAB, or IBN-Channel7, for instance), would face hiccups.

Broadcaster's stake in a cable operator will also be restricted to 20%. Main channels that are likely to face the music include, Star stake in Hathway, Sun TV stake in Sumangali and Zee TV stake in SitiCable. If the bill sees the light of the day, these channels will be forced to take a relook at their equity holding in their cable operating companies and limit their equity exposure up to 20%.

Broadcaster/FM radio operator's stake in another FM radio operator is also proposed to be restricted to 20%. FM radio segment has started witnessing lots of action and the industry is going to see many more mergers and acquisitions in coming months. Transactions like India Today's Red FM stake sale to NDTV will be under scrutiny.

Similarly, merger between two network operators, where equity transactions involved are more than 20% stake, would not be allowed. It could result in further fragmentation of the cable industry by discouraging consolidation.