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Channel pricing: Neo Channel files appeal with TDSAT on TRAI order to slash prices

18-January-2007
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Channel pricing: Neo Channel files appeal with TDSAT on TRAI order to slash prices

Neo Channel has filed an appeal with the Telecom Disputes Settlement Appellate Triibunal against TRAI asking the regulator to explain by February 7 on its order on slashing the bouquet prices of Neo Sports and Neo Sports Plus channels from Rs 58.50 to Rs 37.25.

TRAI had earlier this month directed Nimbus to reduce the price of its two sports channels to Rs 21.25 in non-CAS areas. Nimbus, which has bagged the four-year BCCI cricket telecast rights in a $650 million deal, had in late September 2006, priced its channels Neo Sports and Neo Sports Plus at Rs 49.50 per month and bouquet price for both channels was Rs 58.50. In comparison, TRAI had found, other sports channels such as ESPN-STAR Sports charged Rs 42, Ten Sports Rs 32 and Zee Sports Rs 10.

The counsel for the channels argued at TDSAT that sports couldn’t be treated as a genre as a method of fixing a channel’s price. While Nimbus has questioned the authority of TRAI to fix the price, it has also pointed out to the tribunal that the price of sports channels ranged from Rs 10 for Zee Sports, to Rs 42.50 for ESPN, with Ten Sports at Rs 32 falling in between.

Neo Sports channels presented its case saying that it had rights of almost two-third of the assured cricketing properties involving India till 2010. These properties had a tremendous revenue generating potential and also had to be bought at massive prices, hence the higher prices, the channels argued.

TRAI had argued earlier that fixing of prices for channels of the same ‘genre’, which is one of the key factors as per the TRAI principal Tariff Order’s Clause 3, does not allow Neo Sports and Neo Sports Plus to fix their prices higher than those fixed for channels of the same genre of sports, like STAR Sports and ESPN.

Roop Sharma, President of Cable Operators Federation of India, asked, “The content is the same for all sports channels, so why should Nimbus be treated in a special manner?

Meanwhile, TDSAT has rejected Nimbus’ request to extend the date of compliance of TRAI’s order and directed to list the matter for next hearing in February.

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