The Telecom Regulatory Authority of India (Trai), while reviewing pricing of channel bouquets compared to a la carte ones, has issued amendments to the New Tariff Order (NTO), under which cable operators need to provide as many as 200 channels for Rs 153 a month to their subscribers. The announcement means cable TV users will be able to access more channels at lower subscription price. The operators have been told to announce new pricing structure by January 15.
Significantly, the TRAI capped at Rs 160 the amount consumers will have to pay monthly for all free to air channels. Trai, in a statement, said the decision has been taken to protect interests of all the stakeholders, particularly consumers.
It has decided that in case of multi-TV homes where more than one TV connection is working in the name of one person, it will charge a maximum of 40 per cent of declared Network Capacity Fee (NCF) for the second and additional TV connections. After examining various provisions, TRAI has also reduced the maximum NCF charge to Rs 130 (excluding taxes) for 200 channels.
Besides, it has also been decided that channels declared mandatory by Ministry of Information and Broadcasting will not be counted in the number of channels in the NCF. The new regulatory framework has been introduced to address the issue of huge discount in formation of bouquets by the broadcasters compared to a-la-carte channels. To ensure that price of a-la-carte channel does not become illusionary, Trai has come up with twin conditions.
First, the sum of the a-la-carte rates of the pay channels (MRP) forming part of a bouquet should not exceed one and half times the rate of the bouquet of which such pay channels are a part. Second, the a-la-carte rates of each pay channel, forming part of a bouquet, should not exceed three times the average rate of a pay channel of the bouquet of which such pay channel is a part.
Additionally, authority has decided that only those channels, which are having MRP of Rs 12 or less will be permitted to be part of the bouquet offered by broadcasters, which means a la-carte channel ceiling cost has been reduced from Rs 19 to Rs 12 if included in pre-set bouquets.
Right now, direct-to-home(DTH) or cable TV operators provide 100 channels for a network capacity fee (NCF) of Rs 153 (Rs 130 excluding taxes). The Authority has also permitted Distribution Platform Operators (DPOs) to offer discounts on long-term subscriptions which are for six months or more. A cap of Rs 4 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, the TRAI said.
Experts believe the operators will no longer be able to give deep discounts in a la carte vis-a-vis bouquet, and the discount offered should not exceed 34 per cent compared to about 60-80 per cent discounts on bouquets.
The new amendment in rules will also affect broadcast operators’ revenues by lowering ARPU, which had grown up to 60 per cent after changes in rules last year.
Also, the authority has considered giving more flexibility to DPOs to place the TV channels on Electronic Programme 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, the statement said. The new rules are part of the changes the regulator has made to its 2017 tariff order for broadcasting and cable TV services. They will be effective from March.