TV Distributors Benefit from TRAI’s Revised Tariff Rules

TV Distributors Benefit from TRAI’s Revised Tariff Rules

To reduce the regulatory burden on distribution platform operators (DPOs) during the pay-TV customer migration to other platforms, the Telecom Regulatory Authority of India (TRAI) has issued pricing rules and interconnection regulations.

The regulator has eliminated the network capacity fee (NCF) cap and placed it under forbearance, enabling DPOs to charge clients according to their ability to pay. The previous NCF ceiling was Rs 160 for more than 200 channels and Rs 130 for 200.

The CEO of a cable TV company stated that an NCF sufferance would allow DPOs to charge higher NCF rates to affluent clients while lowering rates for low-income ones.

TV viewers must pay broadcasters subscription fees for TV channels and NCF, also known as an infrastructure charge, to DPOs like Tata Play, Dish TV, Hathway, and DEN under the new tariff order (NTO) regime.

Additionally, the regulator has ordered that free-to-air (FTA) channels on DD Free Dish, which Prasar Bharati controls, must remain free on DPOs that charge a monthly fee.

In the past, to reach a wider audience, broadcasters gave out some pay channels on DD Free Dish in exchange for membership payments to pay DPOs. DPOs are now on a level with broadcasters thanks to the TRAI, which permits them to provide clients with bouquets at a 45% discount on a-la-carte channels.

According to a senior executive of a major media company, DPOs are rarely able to provide a 45% discount on a la carte channels, even with the TRAI’s enabling rule. Broadcasters are allowed to provide a 45% discount on a la carte channels under the current regulatory framework, but only a 15% discount on bundles.

The regulator has eliminated the differentiation between standard definition (SD) and high definition (HD) channels and increased the monthly carriage cost per channel from Rs 4 lakh to Rs 5 lakh. An HD channel used to pay a monthly carriage charge of Rs. 8 lakh, whereas an SD channel paid Rs. 4 lakh.

The TRAI recommended separately to the Ministry of Information and Broadcasting (MIB) that the latter obtain information from broadcasters regarding the primary language and sub-genre of channels before granting permission so that DPOs could organize channels according to language and genre.

It also recommended that to stop piracy and preserve subscriber details, the MIB update DD Free Dish gradually to an addressable system within a given timeframe.

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