Thursday, January 07, 2010

Worldspace India team appeals to PM for intervention

300 employees of Worldspace India have, in a letter to prime minister Dr Manmohan Singh sent on Tuesday, urged for immediate government intervention to ensure that the the radio service continues in India; and that the exit of the radio service be allowed only after following the due process applicable to any other media or telecom service in India.

The letter written to the PM also urges the government to ensure that the sale of the satellite assets impacting the India operations is duly publicized in India; and a just and equitable solution to the employees, subscribers, distributors, dealers, vendors, customer service support agencies is provided for. The Worldspace India team also wants the PM to intervene to issue appropriate orders to restrict the reentry of Liberty Media/Worldspace from providing the services in the guise of a new entity without proper resolution of the issues as above and protection of the stakeholders.

To recap, Worldspace Inc which announced that it was closing India operations from 1 January 2010, had entered into a deal with Liberty Media for take over of its operations. While Liberty acquired the Worldspace India assets, in mid December, it decided not to acquire Indian operations, leaving employees and subscribers in the lurch.

The worried employees state in the letter that they are losing their jobs 'without proper notice, compensation or settlement of their benefits and dues. Former employee dues have not also been paid.'

The letter also mentions that over 150000 subscribers who have invested in the radio receivers and advanced up to 24 months of subscription charges in advance will neither be provided the service nor will be refunded the subscriptions advanced.

'The Border Security Force (BSF) has recently placed orders and purchased receivers and subscriptions. Government institutions/departments such as Indian Metrological Department (IMD), Indian National Centre for Ocean Information Services (INCOIS) and even Press Trust of India users are currently using the Worldspace satellite system to provide timely information. IMD and INCOIS are providing critical data and emergency warning to naval ships, coastal agencies and will now be forced to switch off without notice and any time to look for alternate options', the letter states.

According to the team, music labels and the copyright societies have not been paid royalties for the broadcasts impacting the music industry, widening the gap between broadcasters and copyright owners. More than 200 vendors who have provided goods and services to Worldspace may lose over 20 crores of their dues, they say.
'Several hundreds of distributors and dealers who are currently stocking the products after paying for the same in advance would also be facing huge financial loss as well as customer ire. Several hundreds of channel partners across the country who have invested heavily in the setting up of the infrastructure in supporting the installation, customer care and subscription renewal will not be provided any compensation. Premises have been taken in various cities for offices on lease basis and the landlords will have to approach the local courts to receive back their Premises. All stakeholders involved in the local operations will be forced to involve in multiple litigation in India, which will be rendered ineffective', the letter mentions.

While Worldspace and Liberty Media have cleared their liabilities including employee dues and followed the due process in every other country, certain loopholes in our system are being misused to escape from their responsibilities of orderly closure of the business. In the name of legal process and legal advise, they have delayed notifying the stakeholders and relying on the legal advise provided, as alleged by them, they have completely disregarded the due process of law and equitable interest of all stakeholders, while deciding to close the business in India, the team says.

'We, the employees also have to face the risk of facing all the legal action for improper closure of the India operations. The employees are at a huge risk of facing customer and vendor legal action (civil and criminal action)', the letter ends.

Liberty Media and Robert Schmitz the current Chief Restructuring Officer of Worldspace , Inc., USA wants to escape from the liabilities in India while retaining the assets for encashing the India business opportunity in India at a later date. the letter says.


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