India’s cable TV users could soon access more channels at a lower subscription price—a move that’s likely to affect broadcasters and distribution platforms.
The Telecom Regulatory Authority of India, in its latest tariff order that was posted on its website today, has increased the number of free-to-air channels, reduced pricing for pay channels and capped the number of bouquets of pay channels offered by broadcasters.
The telecom regulator has reduced the ceiling price of pay channels for inclusion in bouquets from Rs 19 to Rs 12. This means while broadcasters are still free to price the channel, if they seek to include them in a bouquet, their à la carte price will be capped at Rs 12 plus taxes.
TRAI has also increased the number of free-to-air standard definition channels to be provided at a monthly cost of Rs 130 to 200 from 100. Cable operators were allowed to charge Rs 130 per month as network capacity fees within which they were supposed to provide 100 free-to-air channels. That has now been capped at Rs 160, with broadcasters given the flexibility to determine the free-to-air channels for different geographies.
The regulator had sought feedback and comments from the industry on two consultation papers in August and September 2019. It said while the first tariff order was able to usher in tax compliance, the intended choice to consumers to select what they want was scuttled due to various issues during the implementation.
TRAI has specified guidelines on pricing of TV channel bouquets as well.
While forming the bouquet, broadcasters must ensure that the sum of the à la carte rates of pay channels in it shall not exceed one and a half times the rate of the bouquet of which such pay channels are a part of. Further, the à la carte price of a channel can’t exceed three times the average rate of a pay channel of the bouquet, the order said.
The regulator has also allowed distribution platform operators to offer promotional schemes on par with broadcasters, including discounts on network connection fees and distributor retail price on long-term subscriptions of duration exceeding six months.
The broadcaster reviewed the guidelines for multi-TV homes. The network connection fees on a second TV in any home cannot be charged more than 40 percent of the NCF charged for the first television along with the flexibility to choose different set of channels for each TV connection.
In a bigger blow to multi-system operators and direct-to-home players, the regulator has capped the monthly carriage fees—that broadcasters pay to cable operators for carrying their channels—at Rs 4 lakh for broadcasting a channel in India. There was no cap on the amount operators could charge broadcasters previously.
Broadcasters and multi-system operators are required to publish the revised pricing by Jan. 15 and Jan. 20, respectively. Consumers will be able to benefit from the new framework from March 1.―Bloomberg Quint