SC adjourns NTO 2.0 matter between broadcasters, TRAI to 15th February

On 1st October, the apex court had refused the request of IBDF and other broadcasters for interim relief and listed the matter before the appropriate court for final disposal on 30th November

e4m by exchange4media Staff
Updated: Nov 30, 2021 4:24 PM
Supreme Court

The Supreme Court has adjourned the New Tariff Order (NTO) 2.0 matter between Indian Broadcasting Digital Foundation (IBDF) and Telecom Regulatory Authority of India (TRAI) to 15th February 2022. The matter was listed for final disposal at admission stage today before the bench comprising Justices U.U. Lalit, S. Ravindra Bhat, and Bela Trivedi.

On 1st October, the apex court had refused the request of IBDF and other broadcasters for interim relief and listed the matter before the appropriate court for final disposal on 30th November. Following the SC's refusal to grant interim relief to broadcasters, the TRAI had issued letters to broadcasters on 12th October seeking compliance report on NTO 2.0 implementation.

The big broadcasters like Star, Zee, Sony, Viacom18 filed their new tariff in compliance with NTO 2.0. All the big players have decided to pull out their popular channels from the bouquet and sell them on à la carte basis. Further, à la carte price of popular sports and entertainment channels has been increased to more than Rs 20 well above the MRP cap of Rs 12.

This move by the big broadcasters will force customers to shell out more money for lesser channels. It will also have huge ramifications for everyone in the TV broadcasting value chain. The tariff hike might lead to drop in channel reach which will also impact advertising revenue. The distribution platform operators (DPOs) might see a drop in their paid customer base as consumers might look at alternative options like OTT and DD Free Dish.

Alarmed by the decision of the broadcasters to keep out popular channels from the bouquets, the TRAI decided to postpone the NTO 2.0 implementation date to 1st April. There are multiple views as to why the TRAI decided to extend the NTO 2.0 implementation date. One view is that the tariff hike would have backfired badly on the regulator.
The timing of the decision has also raised a question if the postponement was done keeping the upcoming assembly elections in mind. Another view is that the industry needs more time to move the customers to the new pricing regime. One view is also that the TRAI is buying more time to clear the mess created by NTO 2.0.

The IBDF had moved Supreme Court against the Bombay High Court verdict to allow TRAI to fix tariff in public interest. The Bombay HC had upheld the NTO 2.0 barring the second twin condition. The IBDF has urged the SC to set aside the Bombay High Court order rejecting the petitions filed by broadcasters besides granting an ex-parte stay on the implementation of NTO 2.0.

In its 1137-page petition, the IBDF has said that the Bombay HC order is erroneous and is liable to be set aside. It has also urged that the operationalisation of NTO 2.0 would require the broadcasters and distribution platforms to execute over 100,000 agreements, and it would be virtually impossible to roll back the effect of the said change, in the event its appeal succeeds.

The foundation has also contended that the TRAI will not suffer any prejudice or hardship if an interim stay is granted. Therefore, the IBDF argued that the balance of convenience lies in favour of the broadcasters since they stand to be subjected to greater inconvenience if the interim order is denied.

The biggest grouse that the IBDF has against the Bombay HC order is that it has incorrectly read into Article 19(2) by applying an additional requirement of public interest when it comes to interpreting a broadcaster’s right to freedom of speech and expression under Article 19(1)(a).

This, the IBDF said, will restrict the fundamental right to speech and expression of the broadcasters and will give powers to the TRAI to micromanage the broadcasting sector.

The TRAI in its counter affidavit has contended that reducing MRP cap to Rs 12 and introducing twin conditions in the NTO 2.0 will ensure 'fair bundling' and discourage 'unfair bundling'. The counter affidavit was filed in response to the IBDF petition against the Bombay High Court order which upheld NTO 2.0, except the 2nd Twin Condition which was struck down, and the TRAI's power to fix tariff in the larger public interest.

The regulator had said that the amendments in the 2020 regulation make small changes to the 2017 regime, which introduced sweeping changes. These changes have been alleged by the broadcasters, to be draconian, constituting a whole new paradigm. This, the TRAI said, is far from the truth.

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