August 2018


On July 3, 2018, the TRAI declared implementations of its "Telecommunication (Broadcasting and Cable) Services (Eighth) (Addressable Systems) Tariff Order, 2017," with certain changes dictated by the Madras High Court.

While framing this Tariff Order, the TRAI's emphasis has been to ensure transparency, non - discrimination, consumer protection and create an enabling environment for orderly growth of the sector. The new framework attempts to address all the issues raised by broadcasters, distributors of television channels and subscribers.

The 2017 tariff order dictates a completely new tariff regime, where Broadcasters declare maximum consumer prices for their channels & distributors (MSOs, DTH, HITS & IPTV) platforms receive a separate 'Network Capacity fee' for providing service + atleast 20% Of MRP As Distribution Fee.

Pay channel and HD Channels prices are not capped. However, any Pay channels (SD or HD) priced above ₹ 19 can only be offered on a stand-alone basis.


Every broadcaster must declare each channel as a Pay Channel or a Free To Air Channel.

Each Pay Channel must have a Maximum Retail Price (MRP) which is the stand alone or a-la-carte price of the channel. The MRP must be more than Zero, and be the same for all platforms (MSO, DTH, HITS & IPTV).


Any pay channel must be offered at the same price throughout India. This effectively does not permit regional pricing of channels.


Unlike earlier tariff orders, the new order is silent on any minimum period of subscription.

This opens up 2 possibilities:

1. Pay Channels likes Sports could sell events separately. For example a sports channel may charge extra to view the ICC Finals, or an English language GEC channel could charge separately to view an even like the Grammy Awards.

2. Sports channels could raise their minimum subscription period to 1 year, thus ensuring that they get paid their full subscription amount even for months when they do not carry any prime content. Further the same tariff order prohibits discounts of more than 15% off the a-la-carte price, even for an annual package.


The tariff regulation requires broadcasters to offer their channels both as a-la-carte and in a bouquet of the broadcaster's channels, under certain restrictions that we have detailed below. Customer a-la-carte and bouquet prices must be declared and shared with the end consumers. This will end the MSO / LCO be made a scapegoat for non-realistic channel pricing.

The TRAI also requires distributors to create multibroadcaster channel bouquets, again with certain restrictions as we have detailed below.

All bouquets offered by broadcasters must also be offered without modification, at the price declared by each broadcaster. The consumer therefore receives the choice of:

1. Stand-alone / a-la-carte Pay Channels

2. Broadcaster's Channel Bouquet & Price.

3. MSO / DTH platform's Channel bouquets & Price. This will provide the consumers ample choice.

Broadcasters Must Declare Their Pay Channel Prices To Consumers


A broadcaster can combine Pay Channel only, from channels of its subsidiary company or holding company, and declare the subscriber MRP of its bouquet. The Subscriber MRP must be the same for MSOs, DTH, HITS & IPTV platforms.

If the MRP exceeds ₹ 19, the channel cannot be offered in any bouquet, and must be subscribed by the consumer on an a-la-carte basis only.

A broadcaster's pay channel bouquet cannot include FTA channels.

The Same bouquet cannot include SD & HD channels.

HD Pay Channels Must Be Offered In A Separate Bouquet


An MSO, DTH, HITS or IPTV platform shall offer channels available on its platform on the following basis:

1. Can create bouquets by combining Pay Channels from different broadcasters.

2. Cannot create bouquets with a combination of Pay & FTA channels.

3. All channels must also be offered a-la-carte.

4. Bouquet price must be 85% to 100% of MRP.

5. All bouquets offered by broadcasters must also be offered without modification, at the price declared by each broadcaster.

6. No bouquet to include SD & HD versions of the same channel.

7. Can form FTA bouquets with a combination of FTA channels from different broadcasters.

No (SD or HD) Channel Priced Above ₹ 19 Can Be Included In a Bouquet


The fact that any channel priced above ₹ 19 (MRP) cannot be offered in a bouquet, will impact the price of Sports channels, and HD channels in particular.


The TRAI tariff order allows the distribution platform (MSO, DTH, HIT or IPTV) to collect:

  1. Distribution Fee From Pay Broadcasters
  2. Network Capacity Fee from consumers
  3. Carriage Fee From FTA & Pay channels
  4. Placement Fees (not regulated). To be independently negotiated between distributor and Broadcaster.


Every pay channel broadcaster must provide distribution platforms a "Distribution Fee" of atleast 20% of the MRP of the Pay channel or bouquet. Exactly the same to all distribution platforms - MSOs, HIT, DTH or IPTV.


Every distribution platform is permitted to charge the consumer a "Network Capacity Fee" as follows:

  1. Not exceed ₹ 130 (taxes extra) for the first 100 SD Channels.
  2. Additional network capacity fee not to exceed ₹ 20 for 25 SD channels.
  3. Each HD channel = 2 SD channels for capacity fee.
  4. The distributor must provide atleast 6 months' notice to consumers and TRAI before changing the network capacity fee.

Within the service fee of 100 SD channels @ ₹ 130 + tax, apart from the channels to be mandatorily provided to subscribers as notified by the Central Government, a subscriber is free to choose any free-to-air channel, pay channel, or bouquet of pay channels offered by the broadcasters or bouquet of pay channels offered by the distributor, or bouquet of free-to-air channels, or a combination thereof.

Hence a subscriber can pay the Basic Service fee of ₹ 130 + tax and select any pay channels, a-la-carte or bouquet or FTA channels totalling 100 SD channels or a mix of any SD and HD channels, where each HD channel is accounted as 2 SD channels.

All DPOs Must Receive:

a. Distribution Fee From Pay Broadcasters

b. Network Capacity Fee from consumers

c. Carriage Fee From FTA & Pay channels

d. Placement Fees (not regulated). To be independently negotiated between distributor and Broadcaster.

DPO: Digital Platform Operator

They Are All CATV, DTH, HITS & IPTV Platforms


Consumers must pay the Network Capacity Fee even for FTA channels they select.


Every distributor (MSO, DTH, HITS or IPTV) must offer at least 1 bouquet, referred to as Basic Service Tier, of 100 channels, including the govt mandated channels. This Basic Service Tier must contain at least 5 channels of each of the following genres:

  1. Devotional
  2. General Entertainment
  3. Infotainment
  4. Kids
  5. Movies
  6. Music
  7. News & Current Affairs
  8. Sports
  9. Miscellaneous

If 5 FTA channels are not available of a particular genre, the distributor shall be free to include channels of other genres.

Every broadcaster must declare the genre of each channel.

The Basic Service Tier Bouquet Is Not Compulsory


Carriage fees are regulated by The Telecommunication (Broadcasting & Cable) Services Interconnection (Addressable Systems) Regulations, 2017, which were also declared on March 3, 2017. However, for completeness of the financials, we are listing details here.

"Carriage Fee" is defined by the TRAI as "any fee payable by a broadcaster to a distributor of television channels only for the purpose of carrying its channels through the distributor's network, without specifying the placement of such channels onto a specific position in the electronic programme guide or, seeking assignment of a particular number to such channels." Hence carriage fee excludes placement fee which is not regulated and can be charged extra, as mutually agreed.

  1. Every distributor must declare the carriage fee charged uniformly from each channel.
  2. Carriage Fee Cannot exceed 20 paise per SD channel and 40 paise per HD channel.
  3. The carriage fee can be discounted upto 35% by the distributor. However, the discounting factors must be quantifiable and applied uniformly to all channels distributed.


TRAI has dictated that the maximum carriage fee charged must diminish as more subscribers of that platform view the channel. Its has dictated the following maximum limits, in addition to the 20p / 40p carriage fee cap for SD / HD channels respectively.

Carriage Fee is capped at 20p per SD channel or 40p per HD channel per month x number of active subscribers on the network.

Carriage fee is applicable for both - FTA and Pay channels.


The very definition of Carriage Fee by TRAI points to the distinct option for distribution platforms to charge separate Placement and marketing fees which are not regulated.

As an example, an extra placement fee can be charged for including in a particular bouquet, of for numbering or placing a channel in the top 3 numbers of a bouquet. There is also no dictate that the placement or marketing fee must be charged uniformly to all broadcasters, in at any predeclared rate.


The tariff order also specifies in detail, the reporting (to the TRAI) requirements by:


Distributors (MSO, DTH, HITS & IPTV).


Every broadcaster and distributor must appoint a 'Compliance Officer' and make available his contact details to the TRAI. The compliance officer must: (a) Generating awareness for ensuring compliance with the provisions of this Order (b) Reporting compliance to the TRAI. (c) Ensure procedures are followed for compliance of this Order. n