DTH ops divided on introduction of 15% cap on broadcaster bouquets

The direct to home (DTH) operators have presented their views on broadcast tariff-related matters in their submissions to the Telecom Regulatory Authority of India’s (TRAI) consultation paper ‘Tariff related for broadcasting and cable services’.

Dish TV submitted that the uptake of a-la-carte channels has been minimal even after eight months of the new regime coming into force. The DTH operator further stated that there is no linkage between the prices of the bouquets and its constituent channels due to non-implementation of the 15% bouquet discount cap.

The DTH operator suggested that one of the remedial measures to prevent broadcasters from pushing bouquets is to lay down a linkage between the bouquet and the ala carte prices of the channel. This will result in the broadcasters declaring a reasonable rate so that bouquet prices are competitive and enable consumers to choose a la carte also. “In fact, in the absence of the linkage, the regulation has not been tested in its complete format.”

It also urged the TRAI not to relook at the NCF cap of Rs. 130/- as it barely covers the operating costs of a DTH player, having varied financial obligations like entry fee, the bank guarantee, the 10% annual license fee, annual NOCC charges, annual WPC charges, annual satellite charges.

It also stated that the TRAI should allow DTH players to undertake inflation-linked hike, since it’s been a good 2.5 years since this NCF was mandated, and as per TRAI’s own admission they had agreed to revisit this in a span of 2 years.

The TRAI also stated that the ultimate objective of the regulations cannot be achieved until and unless the OTT platforms are brought within the ambit of the TRAI regulations.

DTH operators Tata Sky, and Sun Direct have stated that the TRAI cannot introduce 15% bouquet discount cap since it was held invalid by the Madras High Court. They further stated that the Supreme Court has validated the findings of the Madras HC.

Tata Sky further stated that subscribers can get the maximum benefits of discounts if the DPOs are permitted to mutually negotiate better terms for the content than currently permitted.

It also said that the DPO bouquet is much more subscriber friendly as it caters to the needs of the subscriber for availing channels from multiple broadcasters within a pack rather than having to subscribe to multiple bouquets/ or channels.

Airtel Digital TV (Bharti Telemedia) stated that the retail tariff should be kept under forbearance while the wholesale tariff can be regulated. It further stated that no changes should be made to any of the provisions of the tariff order including the provision w.r.t discount on sum of a-la-carte channels forming part of bouquets offered either by the Broadcaster or the DPOs.

“Any changes at this stage will be equivalent to migration and this may not be the ideal time to cause any interference as it will also lead to unnecessary disturbances and customer dissatisfaction,” the company warned.

Tata Sky also stated that it wants a complete forbearance on tariff and therefore, it is not in agreement of any rules restricting the formation of bouquets. It also noted that fixing ceiling at Rs. 19/- has artificially inflated the prices of channels.

The DTH operator said it receives several requests from subscribers for a single regional language bouquet containing all channels available in that language or a single genre bouquet containing all channels available in that genre, however, it is unable to fulfill the demand on account of the restriction against placing Pay and FTA channels together.

Dish TV submitted that discount at the DPO level should be in proportion to the discount being allowed in the broadcaster level.

The DTH operators also stated that they should be allowed the freedom to create bouquets without any restriction.

However, Dish TV has suggested that the TRAI should ensure that no two bouquets should be more than 60-70% similarity in terms of composition. No channel should form part of more than 30% of the bouquets in the relevant market. Channels of different genres and different languages should not be placed in one single bouquet.

“While we do not favor any changes immediately, we do suggest that at a later stage, the Authority can consider rationalization of the number of bouquets by introducing a limit on the number of bouquets as well as limit the number of times changes can be made in the bouquet/s,” Airtel said in its submission.

“Such a measure will safeguard the customers’ interest by shielding them from interferences in the form of frequent changes in the bouquet/s prices. In this regard, we submit that the Broadcasters can be allowed to make cyclic revisions on a fixed date as per the following frequency.”

Tata Sky submitted that any restriction if applied should only be based on the IT system limitations of the DPOs. It also strongly suggested that no limitations may be placed on the DPOs on the number of bouquets being offered.

Both Airtel and Tata Sky recommended that the change in the composition of bouquets should be allowed once in every six months.