20 Nov 2017
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Jawahar Goel blames broadcasters for creating disparity in pay TV market

MUMBAI: Disturbed by the disparity created in the pay TV market due to the growth of Doordarshan’s subscription-free DTH platform Freedish and the proliferation of OTT players, Dish TV managing director Jawahar Goel has urged broadcasters to take corrective measures so that distribution platform operators (DPOs) such as DTH and cable TV are not unfairly impacted.

Blaming broadcasters of their ‘discriminatory’ construct, Goel has said that this has negatively impacted DPOs including Dish TV.

In his letter to the Indian Broadcasting Foundation (IBF), Goel has drawn the example of Reliance Jio’s content cost to broadcasters versus that of DTH. While Reliance Jio is believed to have paid around Rs 200 crore, the DTH industry’s pay-out is over Rs 5,000 crore. The total number of Jio pay subscribers stood at 72 million as of 31 March 2017, as per data announced by the company.

“We understand that the subscription fee charged from Reliance Jio is not even a percentile of the amount charged to DTH operators, considering their number of subscribers. Approximately Rs 200 crore is being paid by Reliance Jio compared to more than Rs 5,000 crore paid by the DTH industry,” Goel said.

All the interconnection agreements between a broadcaster and a DPO mandated by TRAI regulations are expected to be fair, reasonable, transparent and non-discriminatory. But a huge disparity is there in the market.

“The growth of advertisement revenue as well as subscription income has been phenomenal over the years. You would also certainly appreciate that the DPOs have also been most instrumental in ensuring that all the channels which are launched by the broadcasters start becoming available to the subscribers, thereby helping its acceptance and growth. However, recent developments have the capability of impacting the relationship the DPOs have been having with the broadcasters,” the letter said.

Provision of pay content/channels to Freedish without subscription fee

A disturbing trend is that broadcasters are not only providing pay content/channels to Freedish without collecting any subscription fee, but also paying huge carriage fees to the free DTH platform for distribution.

“Such an act by the broadcasters is a clear instance of discrimination against the DTH operators. The result of this apparent discrimination is huge movement of subscribers from pay DTH platform to Freedish. It is a matter of record that last year, due to the presence of pay channel content on Freedish, the number of subscribers of the pubcaster grew by more than 10 million, while the pay DTH platforms have seen static growth during this period,” Goel noted.

Provision of content by OTT/YouTube at negligible to nil rates

Goel accused broadcasters of providing their channels to the OTT platforms at highly discounted rates, which is ‘totally prejudicial’ and ‘discriminatory’ to the DTH platforms. In addition to offering their channels to third-party OTT platforms, broadcasters have also launched their own OTT platforms where all the channels are available to the subscribers at nil to negligible cost.

By launching their own platforms, in addition to discriminating against the pay TV distribution platforms, broadcasters are also in contravention of the cross-media restrictions, Goel said.

Further, broadcasters have been making their popular content freely available on platforms like YouTube. “It has come to our knowledge that as soon as a programme is run on a channel, it is made available on YouTube in no time, thereby making the same channels redundant on a pay platform,” he said.

While broadcasters keep charging huge subscription fee from DPOs, they provide the same content/channel to the OTT platforms at highly subsidized rates, thus not only creating a non-level field but also causing huge detriment to the subscribers of Dish TV and DTH.

“Availability of the same content/channel on alternate distribution platforms on much cheaper rates vis-a-vis DTH rates has started resulting in migration to alternate distribution platforms,” Goel said.

Availability of OTT content on TV

Goel has also drawn notice to the Jio Phone, which also comes with the Jio Cable TV. This accessory will help users connect the Jio Phone to their televisions to stream content on a big screen, including old CRT TVs.

“Such provision of TV channels by an OTT service provider through the use of a cable is nothing, but the provisions of channels through a digital cable wherein the subscriber availing the channel could be transparently accounted for (addressability) and which would squarely fall under TRAI regulations. Further, it is also common knowledge that the channel available on OTT platforms can be viewed on TV screens via transfer like Miracast. Accordingly, the other addressable distribution platforms are required to be treated on a par with such OTT platforms insofar as the provision of TV channels at non-discriminatory pricing is concerned,” the letter, which has also been sent to the DTH Association of India and the All India Digital Cable Federation, stated.

As broadcasters are shifting their focus to increasing ad revenues, subscription income should reduce, Goel noted that the provision of channels by the broadcaster on Freedish as well as on the OTT platforms is a clear indication of being deterrent to the pay TV market.

The IBF comprises seven major members—Star, Zee, Sony, IndiaCast, Sun, Discovery and Times Network. They not only control the IBF but also are the major players collecting the subscription and advertisement revenue. They collect more than 99% of the subscription and advertisement revenue of the Indian broadcasting industry, the letter said.

The IBF members should discuss and decide among themselves whether the emphasis has to be on pay model or a free-to-air (FTA) model, Goel said. “It will be critical for your members to spell out the strategy to hold or grow the pay TV market, which has been contributing around 35–40% of the total revenue of the pay broadcasters,” he added.