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TRAI looking into issues faced by MSOs and LCOs: Parmeswaran

NEW DELHI: The Telecom Regulatory Authority of India (TRAI) is committed to the cause of digitisation and is well aware of the Herculean task ahead of it. It is looking seriously into various issues faced by the multi-system operators (MSOs) and the local cable operators (LCOs), which include billing, entertainment tax and other taxation, said TRAI principal advisor N Parmeswaran.

ParameswaranSpeaking at the industry event Satcab Symposium, Parmeswaran responded to queries and issues of many LCOs.

On billing issues, he said that the subscriber management system (SMS) in the head-end has all the details of the subscribers and that is why the MSO has been made responsible. “If you look at the regulation closely, we haven’t stated that the MSOs will raise the bill directly, but they will be responsible. For the past 20 years, MSOs and LCOs have worked together, so why can’t they do it now? Our aim is the same—that the subscriber gets detailed billing, which they should pay and get a receipt for it. LCOs can’t manage such micro details single-handedly,” he said.

With regard to tax, he said that TRAI is aware that the entertainment tax in some states is very high. However, he said that the regulator will take up the issue with the state governments and the Information & Broadcasting Ministry. “TRAI will also take it up and support you with the same,” he assured.

“Service tax is uniform across India, and regarding entertainment tax, we keep sending advisories to the government and awareness also needs to be created in the state. Now when the budgets will be planned, you can see how much from the entertainment tax has been kept aside for cable operators and then calculate it as per each subscriber. It requires constructive work,” he said.

Talking about the opportunity in the broadband sector, he and TRAI advisors SK Singhal and Agneshwar Sen said that as internationally 50 per cent of broadband is given through cable, there is opportunity in India. In India, the fixed line is only 28–29 million while cable is over 95 million.

“This is a great opportunity and broadband should come in, which is also the aim of digitisation. When you go for broadband, you can give even voice telephony and more through VOIP. When you have a digital infrastructure, you can use it to provide other services. This will not limit your revenue only to TV. You will have to change your business model a bit.”

Clarifying TRAI’s role, Parmeswaran said that the regulator has only two types of functions. While in some cases it can only give recommendations to the government, in other cases such as tariff and interconnection, it can issue regulations.

“We have made a list of taxes being paid in each state and presented it to the government, saying that we have to rationalise it. We have made recommendations on that and submitted it to the government. We also know that the tax in Maharashtra is very high, while, on the other hand, there are also states where the tax is zero. In some states, it’s even Rs 50 per subscriber. So we have asked the government to look into it. If the target is Rs 2 crore and you are getting Rs 3 crore, then you should be satisfied,” Parmeswaran added.

He further said that TRAI has a limit. “In this issue, we can only give recommendations, keep talking about it and create pressure. We have a TRAI Act and can operate only under that.”