TRAI chairman debunks Crisil report, cites IMCL data on ARPU decline in DAS markets

MUMBAI: RS Sharma, the chairman of Telecom Regulatory Authority of India (TRAI), has debunked the Crisil report stating that the average revenue per user (ARPU) has actually gone down based on the report provided by multi system operator (MSO) IndusInd Media and Communications Ltd (IMCL).

Crisil had issued a press release stating that the monthly TV prices are likely to go up under the new pricing regime. In fact, Crisil Senior Director Sachin Gupta had said that the monthly TV bill can go up by as much as 25% based on the current pricing.

Addressing the press in New Delhi, Sharma said that the Crisil report is based on wrong assumptions as not every customer watches all the channels. Each customer has a unique preference for content and that will decide the monthly TV bills.

Sharma said that the regulator had asked the distribution platform operators (DPOs) to provide the trends about the selections being made by their customers under the new regime. Two operators including IMCL provided confidential data to the TRAI.

Quoting the data provided by IMCL for its 1.5 million customers across the four digital addressable system (DAS) markets, Sharma said that the ARPU across the four markets has dropped by 10-15%.

“In Mumbai, the ARPU has dropped from Rs 325 pre-NTO (New Tariff Order) to Rs 271 post-NTO. In Delhi, the ARPU has fallen from Rs 303 to Rs 265. There has been a reduction of 10-15% on an average in all four DAS markets. In some markets it is high in some it is low,” he told reporters.

Sharma also questioned the basis of the Crisil report. “Crisil is a highly professional body while its report was based on certain inputs and assumptions. They have taken the input of top 10 channels, and the computed value of multi-language channels in addition to those which offer similar content.”

He also noted that the assumption that consumers will watch all the channels is incorrect. He also stated that the regulator has asked the operators to collect and collate the data as to how this whole pricing part is playing out.

“We intend to publish this data regularly on our website pre and post ARPU figures subject to their permission,” Sharma noted.

He reiterated that the monthly TV bills will go down if consumers exercise their choice. He also said that the customers were being served many unwanted channels in the earlier.

Sharma also said that the overarching principle of the new framework is to ensure choice to the customer. Whether the price goes up or down is not the main principle.

He also said that the consumers will have the liberty to change their choice every month. “The bill will depend on the number of channels chosen by a consumer. By providing consumers the choice we have unleashed the complete play of market forces,” he stated.

The TRAI chairman is also confident that the transition to the new framework will be smooth. The pre-paid customers will have the freedom to shift to the new regime.

“DTH customers can onboard whenever the contract ends. Customers have the option to continue with old or new framework depending on the contracts,” Sharma stated.

He also said that the TRAI had a meeting with stakeholders earlier this week and the progress has been satisfactory.

“There were complaints that some platforms were not offering freedom of choice to the consumer as far as first 100 channels were concerned. The consumer is at the centre of the universe of the new framework. Interfering with that freedom is a violation of the new framework,” he stated.

The TRAI has also directed DPOs to ensure that the consumers are not inconvenienced in any manner. “Because of the heavy loads, the website of one of the DPO was down. Platform operators have been told to scale up their websites and no consumer should suffer,” he said.

He also said that the DPOs have been asked to allow selection of channels for two TV homes since preferences might differ.

Meanwhile, PTI has reported that the TRAI has served a show-cause notice to Airtel Digital TV over the blackout faced by some of its DTH customers during the switchover to the new tariff regime. The show-cause notice was issued earlier this week, and Airtel has been given three days time to respond.