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More LCO associations move TDSAT against TRAI’s inflation-linked tariff hike

MUMBAI: At least four more cable operators’ associations have moved the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) challenging the Telecom Regulatory Authority of India’s (TRAI) 27.5 per cent inflation-linked tariff hike for non-addressable system.

The latest to challenge the tariff hike in the TDSAT are Karnataka State Cable Operators Association (KSCOA), Amritsar Sangharsh Committee, All Delhi Cable Operators Association and Sai Cable TV Welfare Association Delhi.

The four associations have become interveners in the case that has Centre for Transforming India (CTI) and Home Cable Network as principal petitioners.

The main contention of the local cable operators (LCO) is that TRAI has unilaterally hiked the non-addressable tariff without consulting the stakeholders. The tariff hike will have an impact not just on non-addressable tariff, but also on addressable tariff since the latter is 42 per cent of the former.

Earlier, the Cable Operators Association of Gujarat, UP Cable Operators Welfare Association and Chandigarh Cable Operators Association had joined as interveners in the case.

Among DTH operators, Dish TV has joined as an intervener in the matter.

The tribunal has clubbed all the petitions and put up the matter for final disposal on 4 August.

In the first hearing, the tribunal had stated that in case any stakeholder in the broadcasting sector including any individual broadcaster or association of broadcasters wishes to intervene in the matter, they must file a proper petition by 4 July.

In case any intervention is allowed, all parties brought on record must complete the pleading latest by 26 July, after which no pleading may be accepted. Currently, only Dish TV has joined the matter as intervener.

CTI counsel Aman Lekhi and Home Cable counsel Arun Kathpalia had requested staying the operation of the TRAI order. However, the tribunal said that it was not inclined to pass any stay order at this stage.

The tribunal also directed all stakeholders to keep a separate account with regard to the collections on the basis of the order.

In case the appeals are successful, the individual subscribers making any excess payment in terms of the order will be entitled to adjustments for the succeeding months from the respective LCOs/MSOs.

Similarly, the LCOs will be entitled to adjustments from the MSOs and the LCOs, while the MSOs will be eligible for adjustments from the broadcasters, the tribunal stated.

The TRAI had in March 2014 notified a 27.5 per cent hike in cable tariff in two phases after getting a go-ahead from the Supreme Court to revise tariff to make adjustments for inflation. The apex court posted the matter for hearing on 9 July for final consideration.

TRAI had on 20 February filed an application with the SC seeking permission to revise tariff for non-addressable, as it had not been able to undertake the exercise since 2009 as the matter was sub judice.

The tariff hike will be beneficial for broadcasters as their subscription revenue is expected to jump. The distribution platforms, however, will feel the pinch due to the rise in content costs, while full recovery through the LCOs will be tough.

Cable TV subscribers will also have to pay higher monthly bills, with LCOs pushing for a raise in markets wherever possible. Though in digital addressable system (DAS) areas the retail pricing is left to market forces, the cable TV networks will use the TRAI inflation-linked hike as a garb to increase the monthly subscription rates.