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India Value Fund backed Atria Convergence Technologies, a Bangalore-based multi system operator (MSO) has launched its interactive TV services (IPTV) services in the city with an investment of Rs 450 crores. ACT will be the first to launch this service in Bangalore. This comes at a time when most media companies are deferring or canceling their pre-determined expansion and diversification plans.

The size of India Value Fund's investment in ACT is undisclosed.

IPTV delivers better than digital content services to subscribers using Internet protocol over a broadband connection in a closed network infrastructure. ACT will provide services like internet

videos, movies on demand, pause & play live TV, record a program while watching another, etc. Though the charges will be dependant on the services subscribed to, they start at a price of Rs 300 a month.

The current IPTV launch in Bangalore is on test phase, and the company subsequently plans to launch the services in Indore and Nellore. ACT Television also provides cable TV and broadband services. "After going through intense R&D with the help of our technology group, we are very excited to be the first company to launch this revolutionary IPTV service in Bengaluru," said Sunder Raju, MD, ACT Television.

Cable TV is a rapidly expanding and a lucrative market in India. The country is set to become Asia's leading cable market by 2010 and the most lucrative pay television market by 2015, according to estimates by Hong Kong's Media Partners Asia.

Cable TV is being increasingly recognized as an attractive investment opportunity by both corporate czars and private equity funds. Tulsi Tanti, chairman and managing director of Suzlon Energy, picked up a 49% stake in cable TV firm Digital Outsourcing for around Rs 100

crore in December last year.

The promoters of Videocon Group, the Dhoot family, also picked up a 14% stake in Mumbai-based broadband company IOL Netcom Ltd from open market this year. IOL Netcom has a presence in the Internet Protocol Television (IPTV) space in several metros.

PE funds like ChrysCapital and UK-based Ashmore Investment also have investments in this space. ChrysCapital  picked up 12% in Hathway Cable for $60 million, while Ashmore has invested in Broadband Pacenet.

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