Other key issues discussed in TRAI CP related to new tariff order for broadcasting sector

MUMBAI: The Telecom Regulatory Authority of India’s (TRAI) consultation paper ‘Tariff related issues for Broadcasting and Cable services’ also delves into other critical issues that have bogged the TV broadcasting sector ever since the new tariff regime came into force.

Other key issues discussed in the consultation paper are network capacity fee (NCF) for multi TV home, discounts on Long term subscriptions, placement of channels in EPG, promotional offers by DPOs, flexibility in offering NCF, and whether 25 DD mandatory channels be over and above the 100 channels permitted in the NCF of Rs. 130/.

NCF for multi TV home

The TRAI said it has been receiving several representations from the subscribers of Cable TV and DTH services seeking clarifications regarding tariff for multiple TV connections in a home. They have alleged that DPOs are charging an equal amount of network capacity fee for each TV connection in a home.

Some subscribers have also mentioned that DPOs are providing the same set of channels on all the TV connections and not allowing to choose a different set of channels for different TV connections in a home.

In February, the TRAI had clarified that the regulation does not prohibit the service providers to offer discount or lower NCF for second/additional connections in same location/ home.

Subsequently, TRAI sought information form some major DPOs regarding their policy for multiple TV connections in a home. It noted that some DTH operators are charging lower NCF for second TV connection onwards in a home. However, MSOs do not have differential pricing for multiple TV connections in a home and charge same NCF separately for all the TV connections in a home.

The TRAI noted that at present there are no separate provisions regarding tariff for multiple TV connections in a home in the Tariff Order 2017.

It has asked stakeholders to provide comments on whether regulatory provisions should enable discount in NCF and DRP for multiple TV in a home? Also, is there a need to fix the cap on NCF for 2nd and subsequent TV connections in a home in multi-TV scenario? If yes, what should be the cap? Please provide your suggestions with justification.

Discounts on Long term subscriptions

TRAI said that the a number of DPOs made representations that they want to offer long term subscriptions and as subscribers pay amount of subscription in advance, they would like to offer discount to subscribers.

However, there are no explicit provisions for long duration subscriptions and discount thereon in new regulatory framework. TRAI has also received several complaints from subscribers on the discontinuation of the long term subscriptions by various service providers.

The TRAI has framed three questions on this issue. 1. How should a long term subscription be defined? 2. Is there a need to allow DPO to offer discounts on Long term subscriptions? If yes, should it be limited to NCF only or it could be on DRP also? Should any cap be prescribed while giving discount on long term subscriptions? and 3. Whether Broadcasters also be allowed to offer discount on MRP for long term subscriptions?

Placement of channels in EPG

After examining details of the existing practice of placement of channels in EPG submitted by some DPOs, the TRAI observed that DPOs have adopted different approaches for placement of channels in EPG. Some DPOs have arranged channels language-wise and then within genre-wise under each language. Some DPOs have arranged channels genre-wise and then language-wise under each genre.

This issue was flagged by some DPOs during discussions on the implementation of the new regulatory framework. Accordingly, the committee mentioned earlier was also asked to look into various issues associated with it.

The TRAI has sought responses whether the freedom of placement of channels on EPG available to DPOs being misused to ask for placement fees? If so, how this problem can be addressed particularly by regulating the placement of channels on EPG?

It has also asked as to how the channels should be listed in the Electronic Program Guide (EPG)?

Promotional offers by DPOs

The authority noted that in the present tariff order 2017 there is no provision of promotional schemes for DPOs. Therefore, if any, promotional schemes are to be allowed to DPO then its pros and cons must be examined. One may argue that the important thing which must be kept in mind is that in television sector the subscribers becomes captive to the DPO due to non-interoperability of the STBs.

Therefore, any promotional tariff should clearly indicate the applicable tariff post promotional offer. In any case if DPOs are allowed to offer promotional scheme then issues such as time period for the schemes, frequency of any such schemes etc., has to be determined through established consultative process.

Flexibility in offering NCF

The authority has asked stakeholders whether DPOs should be allowed to have variable NCF for different regions? How the regions should be categorised for the purpose of NCF?

In view of the fact that DPOs are offering more FTA channels without any additional NCF, should the limit of one hundred channels in the prescribed NCF of Rs. 130/- to be increased? If so, how many channels should be permitted in the NCF cap of Rs 130/-?

The authority observed that some DPOs offering a large number of FTA channels free of cost to the subscriber without taking any additional NCF. However, these are the specific channels chosen by the DPO and consumers do not have the choice to choose the channels.

According to TRAI, one way of looking this offering could be that as they are not asking money from the subscriber and therefore there should be no problem and these are complimentary in nature. However, if one looks from other angle, it will be very clear that it is distorting the market and DPO are giving preferential treatment to some of the channels.

In fact, the authority in para 81 of the EM of TTO 2017 had noted that in order to provide flexibility to distributors of television channels and protect the interests of customers/viewers the ceiling of Rs. 130/- has been prescribed. Distributors of television channels are free to fix Network Capacity Fee below this ceiling. However, the Network Capacity Fee will be agnostic to the type of channels carried over the network. It cannot vary based on the channels subscribed by a subscriber.

Mandatory DD channels

TRAI has received several consumers complaints wherein consumes have shown concerns about the mandatory DD channels within 100 channels. They are of the view that since NCF is prescribed to cater for 100 SD channels capacity, subscribers must be allowed the freedom to select 100 SD channels. Mandatory 25 channels of DD are an additional burden on the consumers. They are of the opinion that either customers should be given freedom not to choose any/all DD mandatory channels or these channels should be over and above the 100 channels selected by the subscriber.

The authority observed that channels notified by Central Government to be mandatorily provided to all the subscribers, any change in the rules made by MIB cannot be superseded by the Regulations. However, the authority said it may give recommendations after due consultation process on this issue.

“Another way of solving this problem could be that as there is no additional cost on DPO in offering these 25-mandatory channels over and above the 100 channels chosen by the subscriber in the NCF of Rs. 130/- particularly looking at the trends where large number of FTA channels are being provided by few DPOs without any additional NCF over 100 permitted channels. Therefore, these channels can be excluded from the One hundred channels for which freedom has been given to the subscribers,” the authority noted.

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