Indian Broadcasting Foundation expresses concern over TRAI's consultation paper
In a release, IBF urged TRAI to allow the industry and its stakeholders to adapt to the new regulatory regime
Published - Aug 23, 2019 5:55 PM Updated: Aug 23, 2019 5:55 PM
The Indian Broadcasting Foundation has expressed concern on the issues raised for consultation by TRAI in the Consultation Paper issued on August 16.
“These issues strike at the very heart of the new MRP based tariff regime which TRAI made effective from 1st February 2019 (NTO). It is fair to say the implementation of the NTO has resulted in massive changes in the distribution landscape,” a release from IBF stated. “Nevertheless, with the support of all stakeholders including broadcasters, DPOs and the end consumer, the transition to the new regime is being managed relatively smoothly. Broadcasters, on their part, along with other stakeholders, have done their best to ensure a smooth transition without a disruption of services. TRAI itself has stated at several fora that over 90% of consumers have migrated to the new tariff regime by choosing channels and/or bouquets of their choice.”
IBF added that in compliance with the NTO, pay broadcasters have published their Reference Interconnect Offers (RIOs) pricing their channels in a la carte and bouquet formations in accordance with the regulations. DPOs in turn have offered these channels both on a la carte basis and bouquets customized to meet the choice of their subscribers. In fact, it was TRAI that mandated DPOs to offer their subscribers a “best fit” plan of a la carte and bouquets to encourage a seamless transition to the new tariff regime.
“Surprisingly barely a few months after the commencement of the NTO and even before the industry at large and more importantly the end consumer has fully adapted to the new regulatory regime, TRAI proposes a fresh CP seeking to make fundamental changes in channel pricing and bouquet formation. This goes against all norms of a stable regulatory regime so necessary for the economic advancement of any industry,” IBF stated. “TRAI’s CP proceeds on the assumption that consumers are being denied their choice of channels by excessive discounts on bouquets. IBF wishes to point out that the cap on bouquet discounts under the NTO was struck down by the Madras High Court as “arbitrary”. Further, the global practice in the television and cable industry is the offering of content in bouquets customized to meet the diverse needs of consumers. A report published by the prestigious thinktank, the Indian Council for Research on International Economic Relations (ICRIER), in March 2019 indicates that given a choice consumers, even internationally display a preference for bouquets.”
The IBF further said that broadcasters have not only published their channel prices a la carte and for bouquets but also publicized their offerings through advertisements and promotions enabling the consumer to make an informed choice.
As TRAI itself points out in the CP while a large number of consumers have opted for bouquets, many have also opted for a la carte channels. It is therefore incorrect and would be an affront to the consumer’s intelligence to suggest that they choose channels only on price and not on the quality of their content.
“Frequent tinkering with regulations and attempting to micro-manage free markets can lead to adverse consequences. Promoting a la carte at the cost of bouquets will deny consumers the choice they need in a country like India with such a large and variegated diversity of cultures and languages. Smaller as well as niche content channels will lose out and their viability will come under question. Broadcasters will be unwilling to launch new channels and producers will be unwilling to experiment with new content. All this will lead to fewer shows being produced which will have a knockdown effect on downstream production and on employment in the sector,” it added.
Stating that the broadcasting industry had gone through several major regulatory changes in the last few years moving from analogue to CAS to digital and addressable systems and now to an MRP pricing regime, IBF added, “Stability in policy formulation and “soft touch” in regulatory oversight is an absolute necessity for healthy industry growth. The Government’s focus on “ease of doing business” warrants minimal regulatory intervention. Hence regulatory intervention at this early stage in the implementation of the NTO is not only premature but will have disastrous consequences for the broadcasting industry. In these circumstances, IBF would urge TRAI to defer any further regulatory interventions and allow the industry and its stakeholders and especially the consumer more time to adapt to the new regulatory regime.”
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