"Focus on convergence, IPR & price-sensitivity to grow"

Admitting that regulations may be divorced from business, TRAI Chairman Dr Rahul Khullar advises on how to prepare for the digital future

e4m by Noor Fathima Warsia
Updated: Oct 31, 2012 7:50 PM
"Focus on convergence, IPR & price-sensitivity to grow"

With just a day to go for digitisation to kick-off in the four metros, Dr Rahul Khullar, Chairman, TRAI (Telecom Regulatory Authority of India) pointed out three areas of focus for industry stakeholders to prepare for the changes ahead in the coming decade.

“We have seen in the past that entrepreneurs and people with technological knowledge have moved much faster in the broadcasting industry and in a sense, the government was not even aware of what was happening, so the industry faced the typical problem of regulation coming after the industry had established. But technology is going to continue changing our lives in the future  as well and what we need to do to prepare for that,” said Khullar.

One of the first aspects that we would see is convergence. “When that truly happens, the industry has to figure out how to sort matters pertaining to carriage and content and navigate through the inter-ministerial differences. Should you leave carriage to one and content to the other? If that keeps the two ministries happy, then let us get on with it. The industry will stifle otherwise,” cautioned Khullar.

Another area that needs attention immediately is IPR (Intellectual Property Rights). He quoted the example of the music industry to indicate how piracy will alter the face of an industry. And irrespective of protection one can get from copyright acts, the tech-savvy would still prevail. “Technology overtakes everyone far quicker and as industry, you are in the forefront and you need to figure it out, else you will always be in the one-legged race,” said Khullar.

Stakeholders should also bear in mind that broadcasting did not work in a vacuum but in a context, and that is an Indian context. Film industry understood this well and as the broadcast industry moved forward, it should not look to the model of cable TV or what has happened in the West to see how the Indian market will grow – it needed to understand its own nuances and work with that. For the Indian market, aspects such as price sensitivity are vital.

Khullar admitted that in a government environment, regulators were good in understanding laws and regulations but some of these are sometimes utterly divorced from business but he said he looks to learn more on this aspect from the industry at large.

Carriage fees, DAS and taxes
Various aspects of the current regulations and also policies have stifled the growth of the industry. Clarifying that policy regime was separate from regulation, and that the regulator only regulates within the policy setting provided by the government, by the ministry and other departments, Khullar said that TRAI at present is in various conversations to address some of the concerns of the industry that would enable growth. This included policies on satellite and transponders, high taxation that was crippling the industry and carriage fees that has been legitimised in DAS (Digital Accessible System).

In context to carriage fees that at present is a matter of continuous discussion between industry stakeholders and TRAI, Khullar pointed out that as placement no longer had a role given that the constraint of limited capability does not exist in a digital regime, carriage fee would be rationalised. A fee however to recover distribution costs had to be levied. But the industry should work on fixing that fee. “We want to get out of the business of intervening too much. Don’t draw me into something that I don’t want to do because that is dissipating good regulatory time. If you want us to fix tariffs, we will do it but it is a colossal waste of time. TRAI resources can be used for bigger things,” Khullar stated.

Similarly he pointed out that while for various reasons, BARC (Broadcast Audience Research Council) has not come into being yet, even for television measurement, advertisers, advertising agencies and broadcasters had to come on one platform and work out a deal. If not, regulation will come.

As digitisation proceeds, business models itself is going to change and Khullar’s plea to stakeholders is that the “mess” of carriage and content has to be sorted out. It was important for carriage to be sorted by one regulator and content by another, because then regulators can focus on each aspect. “If you leave it for the government to decide, it would be tug of war between two ministries and the industry’s growth will suffer. In all of this, it is vital for the industry to work together,” said Khullar.

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