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TRAI sets Aug 21 deadline for interconnection deals

13-August-2012
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TRAI sets Aug 21 deadline for interconnection deals

The TRAI (Telecom Regulatory Authority of India) met industry stakeholders to reiterate that any reason for delay, derailment or block in the cable digitisation process of DAS (Digital Addressable System) “would not be tolerated and would be appropriate dealt with” as DAS, the will of the Parliament, is imperative.

Addressing the gathering at a recently concluded meeting, Rahul Khullar, Chairman, TRAI said that he was extremely upset and disappointed because of the non-conclusion of Interconnection Agreements despite giving adequate time to broadcasters and MSOs (multi service operators).

The Interconnection Agreement is meant to stipulate tariff and carriage norms between the broadcasters and the operators. Initially, TRAI’s order to allow carriage fee to prevail in DAS recommendations had created chaos in the broadcasting ecosystem, as the process was seen a setback to broadcasters. However, TRAI clarified that carriage fee, in a digitised environment, would not include placement fee, which at present comprised 90 per cent of carriage fee structure.

The regulatory authority has warned that if the broadcasters and MSOs did not arrive at mutually negotiated agreements, the TRAI will intervene in the matter, and given the time given to both sides to close deals on the subject, TRAI would be justified to get involved.

The TRAI has set August 21, 2012 as the deadline for broadcasters and MSOs to close interconnection agreements.

In the meeting, the broadcasters pointed out to TRAI that in case a rogue MSO or broadcaster does not conclude the agreements deliberately and continues to drag the issue till August 21, on the premise that TRAI stipulated rates would in any case be beneficial to the MSO or broadcaster rather than mutually negotiated deal then this would act as “disincentive for sincere service providers who have concluded their deals”.

The TRAI has hence made it clear that in case of defaulters, the current tariff in terms of RIO regime both for subscription as well as for carriage, would apply. Defaulters will not be able to gain by deliberately delaying the deals. The TRAI agreed to stipulate suitable panel and other provisions in this regard.

The IBF (Indian Broadcasting Foundation) has advised its members that it is imperative they make every effort to conclude majority of deals before August 21 to avoid intervention, as it would then become a benchmark for subsequent phases as well. This could lead to severe financial detriment to the industry.

In the meeting, Khullar also clarified that all rumours that TRAI was in the process of freezing current payout as a possible measure in order to kick start DAS implementation process were false.

Broadcasters now have a week to close deals with MSOs to gear up for DAS.

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