Amendments to Tariff Order, Interconnection Regulations and Quality of Services Regulations

Keeping in view the implementation of digital addressable systems (DAS) and to enable the sector to realize its benefits, the Telecom Regulatory Authority of India had published a comprehensive regulatory framework for DAS on March 3, 2017. This framework comprises of the Telecommunication (Broadcasting and Cable) Services Interconnection (Addressable Systems) Regulations, 2017; the Telecommunication (Broadcasting and Cable) Services Standards of Quality of Service and Consumer Protection (Addressable Systems) Regulations, 2017; and the Telecommunication (Broadcasting and Cable) Services (Eighth) (Addressable Systems) Tariff Order, 2017 for providing broadcasting services. This framework was notified in March 2017. It came into effect from December 29, 2018 after satisfying legal pronouncements. The framework aimed to establish harmonized business processes in the sector, level-play-field, bring-in transparency in TV channel pricing, reducing litigations among stakeholders, and providing equal opportunities to smaller multi system operators (MSOs). However, the intended choice to consumers to select what they want has got scuttled due to various issues during the implementation.

To address various issues, TRAI issued two consultation papers viz: tariff related issues for broadcasting and Cable services on August 16, 2019; and issues related to Interconnection Regulation, 2017 on September 25, 2019. The consultation papers sought comments and suggestions from various stakeholders, on certain tariff and interconnection related issues. Some of the major issues among them were cap on maximum discount permissible to broadcasters while forming a bouquet, number of channels permitted in network capacity fee (NCF), applicable NCF for multi TV homes, flexibility to distribution platform operators (DPOs) in offering long term subscription plans, and carriage fee payable by broadcasters to DPOs.

In order to address the issue of huge discount in formation of bouquets by the broadcasters vis-a-vis sum of a-la-carte channels, the authority prescribed following twin conditions to ensure that price of a-la-carte channels does not become illusionary: the sum of the a-la-carte rates of the pay channels (MRP) forming part of a bouquet shall in no case exceed one and half times the rate of the bouquet of which such pay channels are a part; and the a-la-carte rates of each pay channel (MRP), forming part of a bouquet, shall in no case exceed 3x the average rate of a pay channel of the bouquet of which such pay channel is a part. Additionally, TRAI decided that only those channels which are having MRP of `12 or less will be permitted to be part of the bouquet offered by broadcasters.

NCF related issues were another area of concern for consumers. TRAI has mandated provision of 200 channels in maximum NCF of `130 excluding taxes per month. In addition, it has also been decided that channels declared mandatory by the Ministry of Information and Broadcasting will not be counted in number of channels in the NCF. DPOs have also been mandated that they will not charge more than `160 per month for giving all channels available on their platform. TRAI has decided that in case of multi-TV home where more than one TV connection is working in a home in the name of one person, will charge maximum 40 percent of declared NCF for second and additional TV connections. The authority has also permitted DPOs to offer discounts on long term subscriptions which is for 6 months or more. The authority has also mandated that MSOs, HITS operators, IPTV service providers will not have target market bigger than state or union territory as the case may be. In addition, a cap of `1 lakh per month has been prescribed on carriage fee payable by a broadcaster to a DPO in a month for carrying a channel in the country.

TRAI has also considered giving more flexibility to DPOs to place the TV channels on electronic program guide (EPG) and mandated that channel of a language in a genre will be kept together while placing channels on EPG. Such EPG layout is to be mandatorily reported to the TRAI and no change in this can be done without prior approval of the authority. Amendments carried out through the consultation process has left the basic contours of the new regime untouched and the broadcasters/distribution platform operators (DPOs) will continue to enjoy the flexibility in carrying out their businesses.

The amendments provided time to stakeholders for implementation. Broadcasters were required to publish revised MRP of a-la-carte channels and bouquets on their website by January 15, 2020 and DPOs were required to publish revised DRP of a-la-carte channels and bouquets on their website by January 30, 2020. Consumers will be able to benefit as per the amended provisions with effect from March 1, 2020.