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TRAI issues policy and licensing framework for Headend-in-the-Sky service to I&B Ministry

18-October-2007
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TRAI issues policy and licensing framework for Headend-in-the-Sky service to I&B Ministry

The Telecom Regulatory Authority of India (TRAI) has forwarded its recommendations today to the Ministry of Information and Broadcasting on various policy issues related to the Headend-In-The-Sky (HITS) service. This is part of TRAI’s commitment to promote digital transmission in the cable TV segment, said a statement released by TRAI.

HITS is a satellite-based delivery platform for delivering multi-channel television signals to cable operators across the country. It is capable of delivering TV signals in digital form with addressability features. The HITS operator uplinks signals of TV channels of different broadcasters to his HITS satellite in the sky. The cable operators across the country can then downlink these TV channels from this HITS satellite for further distribution to the subscribers through their cable network in digital form.

The important recommendations on the policy framework of the HITS operation are that HITS operators should be allowed to provide digital signals of TV channels only to the registered multi-system operators (MSOs) or cable operators, and not directly to subscribers. To enable faster digitalisation of cable services, no restrictions regarding transmission frequency band for HITS operation should be imposed. Uplinking from outside India should also be permitted at the option of the HITS operator, while foreign investment of up to 74 per cent in line with the telecom sector has also been recommended.

An entry fee of Rs 10 crore and minimum networth requirement of Rs 40 crore have been recommended to ensure that only serious players get HITS license. However, no annual fee has been recommended in order to ensure level playing field with MSOs, and to ensure that the HITS service competes effectively with other delivery platforms. Additionally, the condition for rolling out the service within a period of one year has recommended. A provision of refundable performance bank guarantee of Rs 40 crore has also been made in the recommendations, with a stipulation that it would be refunded on the completion of rollout obligation and shall be forfeited in the event of failure to roll out the service.

To avoid vertical integration and to promote competition, cross holding restrictions among the broadcasting company, DTH licensee and HITS operator has been recommended. Thus, no broadcasting company or DTH licensee can hold more than 20 per cent of equity in the HITS service company and vice-versa. It has also been recommended that uplink and downlink guidelines need to be amended to enable HITS operators to get signals from the broadcasters. The statement further said, HITS operator should pay spectrum fee similar to that paid by the DTH operators.

Since the HITS satellite will have countryside footprint, it will benefit about 60,000 cable operators who serve nearly 70 million cable TV homes.

Earlier, the I&B Ministry has requested TRAI to formulate and recommend the policy guidelines for HITS operation. TRAI had issued a consultation paper on various policy issues involved in HITS operation on July 24 this year, seeking the comments of the stakeholders. Comments received were subsequently placed on TRAI’s website on August 24, followed by an open house discussion on August 27 in the Capital.

While framing the guidelines for policy framework on HITS, TRAI has been guided by the basic objective of digitalisation of cable TV network in India. The consumer’s interests have been paramount because it is the consumer who needs digital transmission with addressability, the statement said.

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