The TRAI keeps its promise and delivers the three important guidelines on issues relating to tariff, interconnection, and quality of services. The Authority is constantly working toward creating a regulatory environment where there is less ambiguity in rules and regulations, and trying to streamline the sector. A much more rational level playing field is what the Authority is looking at, for all stakeholders and the consumer.
On March 3, 2017, TRAI released the Telecommunication (Broadcasting and Cable) Services Interconnection (Addressable Systems) Regulations, 2017, which will regulate interconnection arrangements for broadcasting services relating to television provided through addressable systems.
The Authority, took into consideration the concerns expressed by stakeholders relating to non-transparency and discrimination, while seeking the signals of TV channels and access to the distribution networks. This included delays in signing of interconnection agreements and non-realistic terms and conditions in the Reference Interconnection Offer (RIO), resulting in enhanced dependency of the seekers on mutually negotiated agreements, which is generally against the interest of small service providers, and creates entry barriers for new service providers.
Non-transparent deals between multi system operators (MSOs) and local cable operators (LCOs) have also been the cause of concern. Non-availability of written interconnection agreements between MSOs and LCOs, no clear demarcation of duties and responsibilities between them, non-adherence to payment terms and conditions, and gaps in delivery of bills and receipts to subscribers as per the regulations in place, were some of the other concerns relating to interconnection expressed by stakeholders.
In order to address these and many other concerns, TRAI initiated a consultation process with stakeholders before notification of these regulations. After taking into consideration the comments, counter comments, and views expressed during the open house discussions by the stakeholders and in-house analysis, the Authority has notified the Telecommunication (Broadcasting and Cable) Services Interconnection (Addressable Systems Regulations), 2017.
In these regulations, due care has been taken to address various concerns of broadcasters. DPOs and LCOs to ensure transparency, non-discrimination, and level playing field across the value chain. Steps have been taken for ease-of-doing-business and orderly growth of the sector. This is expected to bring in level playing field and effective competition in the sector. While doing so, adequate flexibility and freedom has been provided to service providers for innovation and business ingenuity in offering their services.
Broadcasters have been given freedom to publish their RIOs as per their business plans, in compliance to these regulations, encompassing necessary and sufficient terms and conditions so that their offerings are clearly known to all DPOs. A time-bound framework for signing of interconnection agreement has also been mandated. To ensure that the maximum retail prices (MRPs) of TV channels and bouquets declared by broadcasters to subscribers are realistic, a reasonable cap on discounts offered by broadcasters to DPOs has been mandated. To improve transparency, it has been prescribed that such discounts on their offerings should be objectively defined in their RIOs.
Similarly, for transparent and non-discriminatory access to all types of distribution networks, the same has been brought under the regulatory framework. Besides mandating a framework of RIO for charging of carriage fee on transparent basis, a cap on the rate at which a DPO can charge carriage fee has been prescribed. Further, it has also been provided that the carriage fee shall change with the change in subscription level of channels. In this way, entry for new channels in the market has been made predictable.
TRAI has prescribed model interconnection agreement (MIA) and standard interconnection agreement (SIA) to address the issues between DPOs and LCOs, which protects the interest of both parties. This would also ensure a level playing field for all service providers and would be helpful in lowering the entry barriers for new service providers, bringing in more competition in the sector, and thereby more choices to the consumers.
To ensure smooth transition to the new regulatory framework, a time period of 150 days has been provided so that the service providers can either renew or amend all their existing interconnection agreements in compliance with the provisions of the new regulatory framework. Existing regulations to the extent they are applicable for addressable systems have been repealed.
Sharing of Infrastructure
On March 29, 2017, TRAI released recommendations on Sharing of Infrastructure in Television Broadcasting Distribution Sector.
The ministry of information and broadcasting (MIB) had sent a reference dated April 29, 2016, requesting TRAI to examine the issue of infrastructure sharing by MSOs, LCOs, and HITS operators, and provide its recommendation to the government. MIB had also sought recommendation of the Authority on the amendment that may be required in the Cable TV Networks (Regulation) Act 1995 and rules made thereunder to facilitate the infrastructure sharing.
The Authority examined the issues in sharing of infrastructure in TV broadcasting distribution sector comprehensively for all types of predominant TV broadcasting distribution networks. In this connection, TRAI undertook a comprehensive consultation with the stakeholders by issuing pre-consultation paper, consultation paper, and conducting open house discussion with them. After considering the comments, counter comments, and views expressed by the stakeholders during the consultation process, TRAI has finalized its recommendations on sharing of infrastructure in television broadcasting distribution sector.
The objectives of these recommendations are to ease up policy environment for facilitating sharing of infrastructure in TV broadcasting distribution sector, on voluntary basis. The sharing of infrastructure would not only help in enhancing available distribution network capacities but also would result in reduced CapEx and OpEx for the service providers, bringing down the price of broadcasting services to subscribers. In addition, it would lower the entry barriers for new service providers and provide more space on TV broadcasting distribution networks for niche channels – necessary for satisfying the diverse needs of general public – to reach targeted customers. Lowering of entry barriers in the distribution space could propel competition in the market and provide more choices to consumers due to presence of multiple operators in a single territory.
Telecom Tariff Order, 2017
On March 30, 2017, TRAI released Telecommunication (Broadcasting and Cable) Services (eighth) (addressable systems) Tariff (amendment) Order, 2017.
TRAI had issued the Telecommunication (Broadcasting and Cable) Services (Eighth) (Addressable Systems) Tariff Order, 2017 on March 3, 2017, to provide the tariff framework applicable to broadcasting services relating to television provided to subscribers, through addressable systems throughout the territory of India. Clause 3 of the tariff order was required to be implemented after thirty days from the date of its publication in the Official Gazette.
TRAI had received representations from some stakeholders, wherein they had requested the Authority to remove the ambiguity with regard to schedule of declaration of nature and MRP of pay-channels as per Clause 3 of the Telecommunication (Broadcasting and Cable) Services (Eighth) (Addressable Systems) Tariff Order, 2017, and publication of RIO as per the Telecommunication (Broadcasting and Cable) Services (Addressable Systems) Interconnection Regulations, 2017,
To harmonize the provisions related to implementation of Clause 3, TRAI amended the Telecommunication (Broadcasting and Cable) Services (Eighth) (Addressable Systems) Tariff Order, 2017.