The Gujarat high court issued a notice to the Centre and the Telecom Regulatory Authority of India (TRAI) over a petition filed by local cable operators (LCO) challenging the decision to fix the ratio of profit sharing between the cable operators and the multi-system operators (MSO).
A bench headed by acting chief justice A S Dave has sought reply from the authorities and posted the matter for further hearing after two weeks.
In March 2017, TRAI issued notification fixing the ratio of sharing of service charges collected towards cable connections at 55:45 between MSOs and Local Cable Operators (LCO). This was done by inserting a clause 12(7) in the Telecommunications (Broadcasting & Cable) Services Interconnection (Addressable Systems) Regulations. After consultation with various stakeholders, the central government has decided to implement the system.
The Cable Operators Association of Gujarat filed the petition through advocate Pratik Jasani challenging the insertion of clause fixing the revenue sharing between MSOs and LCOs. The cable operators have urged the HC to quash the arrangement primarily on the ground that they were never consulted by the government before implementation of the 2017 notification, though the government consulted other stakeholders.
Moreover, it has also been contended that the sharing of fee collected towards services provided to end users is a subject of a contract between two private parties, and the government cannot dictate terms by giving a final shape to such contracts. This decision has been termed as arbitrary, unjustified and unreasonable.
The petitioner has contended that till now, the broadcasters, MSOs and LCOs were able to negotiate their share in the business amongst themselves and business of the three entities were independent. But the government intervention through TRAI’s decision amounts to suppressing cable operators.―Times Of India