Opaque channel negotiations have become the norm in India, but are proving to be especially unwieldy in an age of increased consumer choice enabled by the national rollout of digital TV.

As millions of cable homes upgrade to digital networks, MSOs are supposed to follow suit with new packages and tiers that will foster more diverse programming and a healthier ecosystem overall.

That’s hard to do without knowing future content costs however, a bone of contention between broadcasters and MSOs. Digital dividends are still pending for both sides, sparking fractious arguments that result in less consumer choice rather than more, as popular channels go dark in subscriber homes.

MSOs in particular are feeling the squeeze. Local cable networks, intermediaries for the vast majority of an MSO’s subscriber base, are reluctant to review revenue shares without a better picture of what they stand to gain. On the other side, broadcasters continue to push for better yields. Beleaguered MSOs are becoming testy, and it shows.

An argument between Star, India’s biggest broadcaster, and some of the country's biggest MSOs could represent a turning point, however. Star was seeking full rates for its channels, even though steep discounts usually apply. It’s a lose-lose situation, stifling affiliate and advertising revenue. 

Deal terms have been revised however, as both sides seek resolution. An industry-wide dispute, rather than one between specific companies, could set a template for agreements that are better designed for a digital age. This would help channels and networks spend less time on litigation, and more time on transformation.

An older version of this article also appears in the Q3 2014 edition of Media Business Asia magazine.