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Following SC nod, TRAI notifies tariff order even as broadcasters remain apprehensive

06-March-2017
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Following SC nod, TRAI notifies tariff order even as broadcasters remain apprehensive

Shortly after receiving a nod from the Supreme Court on March 3, the Telecom Regulatory Authority of India (TRAI) notified the Telecommunication (Broadcasting and Cable) Services (Eighth) (Addressable Systems) Tariff Order, 2017. The Apex Court, however, allowed Star India to seek a stay order from the Madras High Court in relation to this matter. It also directed the Madras HC to dispose of the case within a period of two months.

The Madras HC is currently hearing Star India and Vijay TV’s petition claiming that TRAI has overstepped its jurisdiction by pricing content through its tariff order. The High Court is scheduled to take up the matter next on March 7.

When asked to specifically respond to the argument given by broadcasters that TRAI has over policed the sector through its tariff regulations, Prof M Kasim chose to withhold his comments. “I think this is not the right time to comment on it as the matter is sub judice,” said Kasim, Advisor (B&CS) to TRAI. He added that TRAI was going to hold a press conference on March 6 to answer the queries of the press and allay the apprehensions harboured by some.  

Under the new tariff regulations, broadcasters will have to provide all the channels to subscribers on a standalone or a-la-carte basis. Hoping that the regulations “will bring transparency, level playing field (and) encourage consumer choice”, TRAI said, “The Authority has mandated that a broadcaster can offer a maximum discount of 15% while offering its bouquet of pay channels over the sum of MRPs of all the pay channels in the bouquet.”

The regulator reasoned that the core objective behind restricting discounts on bouquets was to ensure that consumers are not forced to buy channels that they do not wish to view. “Forcing of non-driver channels to subscribers not only reduces choice of subscribers but also eats away bandwidth of distributors of television channels restricting entry of new and more competitive channels,” TRAI added.

Insisting that TRAI’s contention of ensuring choice before consumers is a point well taken, RK Arora, Strategic Partner, JK Media Network, said, “The consumers should not be pressurised to take a certain number of channels.” Presently, many consumers are forced to buy channels that they are not interested in watching as part of a bouquet of channels which TRAI intends to overcome through its tariff order.

As per the genre-wise price ceilings devised by TRAI in October, the maximum retail price stipulated for sports channels was at Rs 19, general entertainment channels at Rs 12 and movie channels at Rs 10. While infotainment channels could not cost more than Rs 9, the MRP for kids’ channels was to be Rs 7. Out of the seven genres, devotional and news channels had been priced the least at Rs 3 and Rs 5, respectively.

The regulator has now slightly amended its order by removing genre-wise price ceilings after taking into account the opposition from broadcasters. But still, no pay channel which is a part of a bouquet can have a maximum retail price of more than Rs 19. “I think this is not justified. Pricing should have been left to the broadcasters,” said Arora, former Executive Director & Chief Operating Officer of Zee Media Corporation Limited (ZMCL).

On the distribution side of the business, TRAI has capped the rental fee per month per set top box from a subscriber to a DPO at Rs 130. The subscriber will receive 100 SD channels wherein one HD channel shall be recognised as being equal to two SD channels. Subscribers can access additional capacity in slabs of 25 SD channels for which they cannot be charged more than Rs 20 excluding taxes per slab. 

Speaking on the condition of anonymity owing to the sensitivity of the issue, the promoter of a television network lamented that broadcasting especially news was losing out on a lot of money. Stressing that “broadcasting is the easiest medium to control”, the businessperson wondered as to “what they are getting out of it”. Pinning hopes on industry bodies, the source said, “We are all waiting for NBA (News Broadcasters Association) and IBF (Indian Broadcasting Foundation) to take a call on this.” It was also mentioned that NBA is slated to meet on March 6 to discuss the plan of action ahead after taking into account feedback from all the stakeholders. 

Tags Telecom Regulatory Authority of India TRAI Supreme Court Vijay TV

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