In a move that will lower the bill of the five-million direct-to-home (DTH) consumers by 5-8 per cent, the Telecom Regulatory Authority of India (Trai) has asked channels to reduce the bouquet rates on DTH platform by April 4. The move will affect the subscription revenue of Star TV, Zee Group, Sony-One Alliance, Sun Network, ESPN-Star Sports, among others, who will have to significantly reduce prices for selling signals to DTH players. However, this will help DTH operators lower the subscription fees. The average monthly fees per subscriber is about Rs 250 at present. According to Trai’s pricing formula for broadcasters, pay channels can charge DTH operators up to 50 per cent of the per subscriber rates they charge from the cable operators in the rest of the country (non-CAS homes). This means that if Star TV’s bouquet of 14 channels is priced at Rs 88 in non-CAS areas (70 million cable TV homes), it can charge only Rs 44 or less from existing DTH operators like Tata Sky, Dish TV and new entrants like Big TV, Bharti and Sun Direct. But all broadcasters are charging more from DTH companies than from non-CAS cable homes. Explaining this industry analyst said: “As DTH platform is digital, there is 100 per cent collection of fees, while in the cable sector, the under-declaration (cable operators declare a lower susbcriber base than the actual) is 25-35 per cent. Therefore, even at a lower subscriber base, broadcasters earn more from DTH companies than from cable homes.” Senior executives of most pay channels said they would abide by Trai’s order. “We are drafting the new rates, which will be submitted to Trai within the deadline,” said a senior Zee group executive. Star TV India executives said the law would be followed. However, executives of sports broadcaster ESPN-Star Sports said discussions were on within the company. The leading sports broadcasters has a three-channel bouquet (ESPN, Star Sports and Star Cricket) and its per subscriber cable rates are about Rs 45. However, instead of charging Rs 22 or less, ESPN India is charging DTH players Rs 50 per subscriber for just two channels. Leading regional broadcaster Sun Network is also charging more, sources say. Its bouquet rates for cable homes are said to be Rs 114 per subscriber while it is charging Rs 83 per subscriber from DTH operators. According to an earlier TDSAT order (appellate tribunal for broadcasters and telecom operators), Sun Network has to provide DTH players its bouquet of 16 regional channels for Rs 25 per subscriber. “The Trai directive will help bring in parity in rates,” said a senior executive of Dish TV, the country’s largest DTH company.
Trai asks DTH players to cut rates by April 4
Telecom and broadcasting regulator TRAI on Monday warned that it would step in and fix the price for channels if broadcasters and DTH operators failed to find an immediate solution to their ongoing standoff. TRAI chairman Nripendra Misra has asked broadcasters to be realistic while fixing the price of channels and also added that any further delay would force the regulator to intervene.
Last week, ET reported that DTH players had approached TRAI seeking its intervention as they failed to find common ground with broadcasters over the pricing of channels. This had resulted in DTH players demanding that TRAI put in place a system similar to that for cable operators in metros (CAS notified areas), where broadcasters cannot charge more than Rs 5 per pay channel per subscriber.
If a similar system were to be implemented for DTH, the monthly bills for subscribers on this platform will fall significantly. This is because some broadcasters charge DTH players between Rs 15-Rs 40 per subscriber per month for
certain channels.
DTH operators such as Tata Sky say most channels are demanding exorbitant prices and hence they have been unable to conclude mutual agreements. Broadcasters, on the other hand, have ruled out any possibility of providing channels at the same rates to both cable operators and DTH players. Broadcasters share the view that since DTH was a different platform, the pricing point cannot be comparable with that for cable TV operators.
While confirming that TRAI would fix prices if both sides failed to find a quick solution, TRAI chairman Nripendra Misra told ET: “The authority is very concerned about the delay in agreement between broadcasters and DTH license holders. While its (TRAI’s) first preference is not to initiate a process for price fixation, this can become the preferred option as the last resort. TRAI has appealed to broadcasters to be realistic both in terms of channel pricing and interconnect conditions. However, any further delay will force the authority to review its present stance (and fix prices)”.
At the same time, it must also be pointed out that cable operators want DTH players to be charged a higher sum by the broadcasters. This is because, the cable industry fears that it will lost out significantly if DTH players offer similar rates.
Late last year, when bringing about changes in the DTH guidelines, TRAI had refused to fix the price for individual channels. Instead, the regulator had asked both broadcasters and DTH operators to enter into mutual commercial agreements through negotiations.
Broadcaster-DTH dispute: TRAI threatens to fix prices- Entertainment-Media / Entertainment -News By Industry-News-The Economic Times
Trai asks DTH players to cut rates by April 4
Telecom and broadcasting regulator TRAI on Monday warned that it would step in and fix the price for channels if broadcasters and DTH operators failed to find an immediate solution to their ongoing standoff. TRAI chairman Nripendra Misra has asked broadcasters to be realistic while fixing the price of channels and also added that any further delay would force the regulator to intervene.
Last week, ET reported that DTH players had approached TRAI seeking its intervention as they failed to find common ground with broadcasters over the pricing of channels. This had resulted in DTH players demanding that TRAI put in place a system similar to that for cable operators in metros (CAS notified areas), where broadcasters cannot charge more than Rs 5 per pay channel per subscriber.
If a similar system were to be implemented for DTH, the monthly bills for subscribers on this platform will fall significantly. This is because some broadcasters charge DTH players between Rs 15-Rs 40 per subscriber per month for
certain channels.
DTH operators such as Tata Sky say most channels are demanding exorbitant prices and hence they have been unable to conclude mutual agreements. Broadcasters, on the other hand, have ruled out any possibility of providing channels at the same rates to both cable operators and DTH players. Broadcasters share the view that since DTH was a different platform, the pricing point cannot be comparable with that for cable TV operators.
While confirming that TRAI would fix prices if both sides failed to find a quick solution, TRAI chairman Nripendra Misra told ET: “The authority is very concerned about the delay in agreement between broadcasters and DTH license holders. While its (TRAI’s) first preference is not to initiate a process for price fixation, this can become the preferred option as the last resort. TRAI has appealed to broadcasters to be realistic both in terms of channel pricing and interconnect conditions. However, any further delay will force the authority to review its present stance (and fix prices)”.
At the same time, it must also be pointed out that cable operators want DTH players to be charged a higher sum by the broadcasters. This is because, the cable industry fears that it will lost out significantly if DTH players offer similar rates.
Late last year, when bringing about changes in the DTH guidelines, TRAI had refused to fix the price for individual channels. Instead, the regulator had asked both broadcasters and DTH operators to enter into mutual commercial agreements through negotiations.
Broadcaster-DTH dispute: TRAI threatens to fix prices- Entertainment-Media / Entertainment -News By Industry-News-The Economic Times
