The Telecom Regulatory Authority of India (Trai) has threatened to fix prices of pay channels on the direct-to-home (DTH) platform in line with the Rs 5 per channel cap on conditional access system (CAS) services in Delhi, Mumbai and Kolkata.
The move will lower fees but hit the income of broadcasters from DTH companies. A major beneficiary may be the new DTH entrants like Big TV (Reliance) ADA Group), Bharti, Sun Direct and Videocon
as their cost of content will come down.
However, for the two existing DTH companies, Dish TV and Tata Sky, the current rates will continue as content contracts are generally for three-five years.
A meeting between pay-channel broadcasters and Trai is scheduled for March 28. The regulator has been using a similar method to control telecom tariffs.
Currently, pay channel broadcasters like ESPN, Star India, Zee Group and Sun Network are charging more per subscriber for giving content for DTH services than for cable TV homes outside CAS areas. There are about 76 million cable homes in the country and around 5 million DTH subscribers.
Trai's formula for pricing content on the DTH platform entails that all pay channel broadcasters should charge DTH operators up to 50 per cent of the bouquet price they charge cable operators in non-CAS areas (about 70 million cable homes).
For example, the per subscriber bouquet price of sports broadcaster ESPN-Star Sports in non-CAS areas is Rs 44.17 but the company is charging DTH companies Rs 50 in non-CAS areas.
Star India is charging Rs 88.40 per subscriber for its 14-channel bouquet in non-CAS areas, while it is charging Rs 48 per subscriber for selling content to DTH companies. Under the Trai formula, it should not charge more than Rs 44.20.
According to industry sources, broadcasters like Sun Network, Star India, Zee, ESPN-Star Sports and Sony One Alliance, among others, are charging 55-115 per cent more from DTH companies than what the regulator has mandated.
\"Trai has told us to lower our DTH price in line with its formula, else it may bring out a tariff order mandating bouquet pricing,\" said a senior executive of a leading broadcasting house.
But sources said certain niche broadcasters with a handful of pay channels in their bouquet were opposing the move on grounds of higher cost of content acquisition and might move court in case Trai tried to regulate prices on the DTH platform
Trai may cap DTH channel prices
The move will lower fees but hit the income of broadcasters from DTH companies. A major beneficiary may be the new DTH entrants like Big TV (Reliance) ADA Group), Bharti, Sun Direct and Videocon
as their cost of content will come down.
However, for the two existing DTH companies, Dish TV and Tata Sky, the current rates will continue as content contracts are generally for three-five years.
A meeting between pay-channel broadcasters and Trai is scheduled for March 28. The regulator has been using a similar method to control telecom tariffs.
Currently, pay channel broadcasters like ESPN, Star India, Zee Group and Sun Network are charging more per subscriber for giving content for DTH services than for cable TV homes outside CAS areas. There are about 76 million cable homes in the country and around 5 million DTH subscribers.
Trai's formula for pricing content on the DTH platform entails that all pay channel broadcasters should charge DTH operators up to 50 per cent of the bouquet price they charge cable operators in non-CAS areas (about 70 million cable homes).
For example, the per subscriber bouquet price of sports broadcaster ESPN-Star Sports in non-CAS areas is Rs 44.17 but the company is charging DTH companies Rs 50 in non-CAS areas.
Star India is charging Rs 88.40 per subscriber for its 14-channel bouquet in non-CAS areas, while it is charging Rs 48 per subscriber for selling content to DTH companies. Under the Trai formula, it should not charge more than Rs 44.20.
According to industry sources, broadcasters like Sun Network, Star India, Zee, ESPN-Star Sports and Sony One Alliance, among others, are charging 55-115 per cent more from DTH companies than what the regulator has mandated.
\"Trai has told us to lower our DTH price in line with its formula, else it may bring out a tariff order mandating bouquet pricing,\" said a senior executive of a leading broadcasting house.
But sources said certain niche broadcasters with a handful of pay channels in their bouquet were opposing the move on grounds of higher cost of content acquisition and might move court in case Trai tried to regulate prices on the DTH platform
Trai may cap DTH channel prices
