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TDSAT’s RIO angle in NSTPL case makes broadcasters approach Supreme Court

MUMBAI: Haunted by the possibility of reference interconnection offer (RIO) becoming the starting point of future content deals, broadcasters have moved the Supreme Court against the Telecom Disputes Settlement & Appellate Tribunal’s (TDSAT) judgment in the Noida Software Technology Park Ltd (NSTPL) case.

Along with Star India and ZEEL-owned Taj Television, the Indian Broadcasting Foundation (IBF) has moved the apex court, a source said.

The court has listed the matter for hearing on 22 February.

According to the source, broadcasters have contended that the TDSAT, through its order dated 7 December, has completely taken away the freedom of contract. They have also stated that the tribunal has crossed its jurisdiction by passing an order on the regulation of the Telecom Regulatory Authority of India (TRAI).

Moving the SC comes after Star’s petition gets dismissed by Delhi HC

Earlier, the Delhi High Court had dismissed Star India’s petition challenging the TDSAT’s orders dated 7 and 18 December 2015. The court had said that the petition was not maintainable as the petitioner had the alternative option of appealing in the Supreme Court.

Star had challenged the TDSAT orders, stating that the procedure adopted and the jurisdiction exercised in issuing the directions were beyond the powers of the tribunal under the TRAI Act 1997.

Star had rushed to the HC also because the TDSAT had directed it as well as Taj Television to disclose by 12 January the commercial agreements they had forged with national multi-system operators (MSOs).

Why TDSAT judgment has deeper ramifications and broadcasters are contesting it

In its 7 December 2015 judgment, the TDSAT had ruled that RIO would form the starting point for any negotiations between broadcasters and distributors of TV channels.

It had also stated that a headend-in-the-sky (HITS) operator is akin to a national MSO. Hence, it will be governed by the same commercial terms for an interconnection arrangement as a national MSO.

The TDSAT had also stated that RIO must reflect not only the rates of channels but also the different bouquets in which a broadcaster wished to offer its channels for distribution, along with the rates of each of the formation or bouquet.

The tribunal had further said that the a la carte and the bouquet rates must conform to the ratio mandated in Clause 13.2A.12, which states that the sum of the a la carte rates of the pay channels should not exceed one and a half times the rate of that bouquet and the a la carte rates of each pay channel should in no case exceed three times the average rate of a pay channel of that bouquet.

The tribunal had also said that RIO must clearly spell out any bulk discount schemes or any special schemes based on regional, cultural or linguistic considerations that would be available on a non-discriminatory basis to all seekers of signals.

The RIO must enumerate all the formats along with their respective prices in which the broadcaster might enter into a negotiated agreement with any distributor, the tribunal had said.

The main implication of the TDSAT judgment is that broadcasters cannot enter into any negotiated deal with any distributors unless the template of the arrangement, along with its price, consistent with the ratio prescribed under Clause 13.2A.12, is mentioned in the RIO.

TRAI’s review of existing tariff arrangements

Recently, TRAI came out with a consultation paper to carry out a review of existing tariff arrangements and develop a comprehensive tariff structure for addressable TV distribution across delivery platforms (DTH, cable TV, HITS, IPTV) at a wholesale and retail level.

The major issues covered in the consultation paper are:

  • Tariff models at wholesale and retail levels
  • Channel pricing mechanism and methodologies
  • Issues related to niche channels
  • Pricing of high-definition (HD) channels
  • Ease of channel or bouquet subscription
  • Channel visibility on electronic programme guide (EPG)
  • Pay-per-programme viewing and tariff options
  • Variants of channels
  • Carriage, placement and marketing fees

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