TRAI issues FAQs on new regulatory framework for broadcasting sector

MUMBAI: As the D-Day for the implementation of the new regulatory framework nears, the Telecom Regulatory Authority of India (TRAI) has published a list of FAQs on the new framework in order to clear doubts in the mind of the consumers.

The FAQs is divided into six parts. The first part contains general concerns regarding the new regulatory framework. The second part is about the general understanding of the new framework.

The third and fourth parts deal with the obligations of broadcasters and distribution platform operators (DPOs) under the regime.

The fifth part deals with a whole host of issues that concern the end consumers. Finally, the sixth part has the list of TV service providers and list of important website.

The regulator has noted that the new framework stipulates that the subscribers will not be pushed with unwanted channels. Rather she/ he will have the freedom to choose only those TV channels that they want to see and pay accordingly.

80% subscriber as per the viewing pattern is given by BARC, either view or flip 40 or less number of channels. Further, if a consumer carefully chooses channels of its choice for the complete requirement of a family, the amount payable by him maybe even less than the present payments being made per month.

It also said that the cost to consumers will not increase as some broadcasters with wider presence have reduced the price of their channels recently. The published prices as declared by broadcasters are offered prices and not the final market-determined prices.

The authority expects the markets forces to stabilise the prices soon based on economic principles.

While noting that the tariff order proposes equitable revenue share between multi system operators (MSOs) and local cable operators (LCOs), the authority said that the new framework will benefit such LCOs or group of LCOs who wish to upgrade to become MSOs.

On the issue of availability of free to air (FTA) channels on DD Free Dish, the regulator said that the regulations prescribe that a broadcaster has to declare its nature of channels as either pay channel or FTA for the addressable system. Therefore, the nature of the channel should be the same on all addressable platforms.

It further stated that the TRAI is seized of the matter and is in correspondence with those concerned in this regards.

Click here to read the FAQs on New Regulatory Framework for Broadcasting and Cable TV services

The TRAI also listed the benefits of the new framework for broadcasters, distributors and consumers. These are mentioned below:

a. Benefits for Broadcasters:

  • For the first time since 2004, Broadcaster has become master of their channels, with full price forbearance. The broadcaster can now fix maximum retail price (MRP) of a pay channel for consumers. The concept of broadcaster giving channels to the distributor on wholesale price and distributor retailing it to the consumer is given a go by.
  • All price caps which operated since 2004 in the analogue mode and fixing of rates of channels by broadcasters keeping frozen analogue rates as the basis in the addressable system has been removed. The broadcaster can price its channels and fix MRP for the consumer under complete forbearance.
  • Flexibility has also been provided to the broadcaster to offer a bouquet of channels for the consumers and prescribe MRP of the same.
  • The bouquet(s) offered by the broadcasters to consumers shall be provided by the distributors to the consumers without any alteration in the composition of the bouquet(s).
  • For Channels a “Must carry” provision has been prescribed for all types of distribution platforms, thereby removing the entry barrier for any broadcaster. All Distributors are required to publish an RIO giving details of carriage fee. Transparent and slab-wise pricing of channel carriage fee is mandated, thereby benefitting any broadcaster who gets more eyeballs.
  • Mandatory provision of Electronic Program Guide (EPG) to ensure that all channels are available to the consumers transparently.
  • To ensure the smooth revenue flow in the value chain and thereby reducing the disputes, a provision of mandatory and transparent third-party audits of Distributors to ensure true reporting of subscriber base has been provided.
  • Automated system generated subscriber reports to be made available by distributors to all broadcasters, thereby improving transparency has been provided for.

b. Benefits For Distributors

  • Broadcasters have been mandated to publish an RIO giving transparent and non-discriminatory terms including discounts (if any) based on measurable parameters. This would enable Distributors in getting non-discriminatory deals on a transparent basis and scope of disputes would be reduced.
  • Broadcasters have to enter into agreements with distributors on the basis of RIO only. No mutual negotiations dehors the RIO is permitted.
  • Distributors are empowered as they can now sign and send the RIO published by any broadcaster and it is treated as a binding agreement.
  • The standard format for subscription reports by Distributors and Audit mechanism has been provided.
  • Independent source of revenue for distributors in form of Network Capacity fee so that they can upgrade their network and services.
  • It is pertinent to note that the cost of channel and cost of the network has been made independent of each other in the 2017 regime.

c. Benefits For Consumers

  • A consumer becomes real decision maker of what she/he views and has complete freedom to choose what he/she wishes to watch and pay only for that. It is mandated that all channels have to be offered on the a-la-carte basis and the MRP has to be declared. Same way, the MRP of the Bouquet has to be published.
  • Flexibility has been given to the distributors to drop such channels which do not command reasonable subscription thereby increasing the capacity to carry more channels of consumer choice.
  • The consumer is not required to pay any subscription fee for an FTA channel if he subscribes to one.
  • The service providers have been mandated to give full information regarding channel prices on Electronic Program Guide.
  • The consumer gets clarity of the product offered and is not fleeced by smart packaging. It has been mandated that FTA channels can’t be clubbed with Pay channels in a Bouquet. Further, HD channels can’t be clubbed with the SD version of the same channel, so that the consumer has complete clarity with respect to what is on offer.

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