After conditional access system, direct-to-home television may finally become a reality with the government clearing a Zee promoted company's letter of intent for setting up the services in the country.

Information and Broadcasting Minister Ravi Shankar Prasad has given his nod for the LoI, the first in the DTH sector, sources said on Tuesday.

However, it may take over a month for the company, ASC Enterprises, to get the final licence to operate the service as it now has to apply for spectrum clearance from the Wireless Planning Commission and submit a Rs 40 crore (Rs 400 million) bank guarantee after which government will examine its structure as per the guidelines.

Sources said Zee has asked the ministry if it can split the bank guarantee into renewable portions contending that banks do not give such an amount for a period as long as ten years. Subhash Chandra's ASC has already paid Rs 10 crore as refundable entry fee to the ministry.

They said while getting the LoI would mean one-third of the way through, it may take another month or more for the company to get the license if all goes well.

Players in the DTH race have given varying figures for set-top boxes and subscription to the government, with Zee claiming it will offer set-top boxes free of cost to its consumers and a monthly subscription of Rs 150 and Star quoting around Rs 7,500-8,000 for set-top boxes and around Rs 700-800 monthly charges.