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Hathway prices Star channels to its cable TV subscribers
MUMBAI: Hathway Cable & Datacom has begun the exercise to offer the Star India channels to its cable TV subscribers at a la carte rates from 1 October.
The multi-system operator (MSO) has decided to adopt an introductory pricing of Rs 10 per month plus taxes for each entertainment channel and Rs 20 per month plus taxes for each sports channel. Hathway, however, gets these channels from Star on Reference Interconnect Offer (RIO) basis, the rates of which vary.
While rates for channels are different, Hathway will adopt single price point per channel to make it easier for consumers to compute their monthly payout and recover some of the costs with small margins on some channels.
Other MSOs are expected to announce the subscriber rates and revised package pricing on Wednesday. This follows Star’s decision to offer its channels to MSOs only on RIO basis.
Initially, all the MSOs were expected to follow the same introductory pricing. However, there was difference of opinion between Hathway and IndusInd Media & Communications (IMCL), which wanted the channels to be priced two times higher to account for local cable operators’ (LCOs) share and their own margin.
IMCL contended that the introductory price will become a standard price; therefore, it must be priced higher. However, Hathway argued that cable TV customers are not used to a la carte rates and, therefore, it must be priced reasonably initially.
The development is an outcome of the dispute between broadcaster Star India and Hathway. Star India had filed an affidavit with the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) that it will do only RIO deals with MSOs in digital addressable system (DAS) areas.
The affidavit was given after the tribunal had asked the broadcaster whether it would agree to consider RIO as the only option to maintain parity.
The MSOs will reveal each channel’s sales figures every fortnight which will be interesting data to understand consumer viewing habits.
Earlier, as reported only by TelevisionPost.com, the MSOs had met on Monday to chalk out a strategy on how to offer Star channels on RIO. The MSOs had decided to de-activate the Star channels in a phase-wise manner so that they could be offered to consumers on a la carte basis as per their choice.
First to be de-activated and offered on RIO to subscribers will be the Star Sports channels. The entertainment channel will be put on RIO after that.
The MSOs plan to come out with a joint awareness campaign to inform consumers that they had to order and pay for the Star channels, courtesy of the broadcasters’ affidavit in the TDSAT.
Earlier, the TDSAT had ruled that broadcasters cannot apply RIO retrospectively. It had stated that Clause 5.16 of DAS regulation has no application in a case where after expiry of an agreement, parties enter into a new agreement, the basis of which is completely different from the basis on which the previous agreement was founded.
It had also ordered that from 1 October both Taj and Star channels (including Star Sports) will be available on RIO basis on Hathway. For the period from the date of expiry of the agreement till 30 September, the tribunal had directed Hathway to Rs 27 cost-per-subscriber (CPS) to Star and Rs 21.50 CPS to Taj Television.