The Union Information and Broadcasting Ministry is likely to finalize the DTH policy soon and a Cabinet note on it has been circulated for comments from various ministries. Sources stated that license holders have been given an interim extension till June 2019 till the finalization of the policy. It is learnt that new policy proposes to continue with the 20 percent cap on broadcasters on cross holding of stake in the Direct To Home (DTH) operations.
It is understood that keeping 20 per cent restriction is contrary to government of India’s push for bringing in fresh investment into broadcast distribution sector which is capital intensive. The decision to put back the 20 percent cross holding restrictions comes despite objection by Niti Ayog and DIPP.
Sources stated that the TRAI — the regulatory body for broadcasting sector in the country — has also insisted on removal of this cross holding cap in their recommendations in the years 2008 and 2014. However, the I&B ministry has decided continued with the cross holding patterns as in the old policy. It is also being viewed as contrary to Government of India policy to encourage foreign direct investment.
Sources stated that while 100 percent FDI is allowed in the broadcast distribution space this 20 per cent restriction on cross holding blocks fresh investment coming into the sector by global distribution companies such as Comcast and Liberty Global. The industry had sought that this 20 per cent cap should be removed from DTH cross holdings. This cross holding restriction is not applicable on other platforms like cable television and HITS and its continuance in DTH looks inexplicable.
The government wants to update the decades old DTH policy keeping in view the fast changing technology and current needs of the industry but so far failed as the existing DTH companies are operating under temporary licenses on a year on year basis, which is also contrary to the “ease of doing business” and creating a stable regulatory and policy roadmaps. — The Asian Age