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TRAI PROPOSES CAP ON CARRIAGE FEES FOR ALL ADDRESSABLE PLATFORMS
TAs part of its comprehensive new regulations that will apply uniformly to all Broadcasters, Cable Networks, HITS, DTH & IPTV platforms, the TRAI has proposed a new Interconnection Regulation.
TRAI has been regulating interconnection (distribution of signals) of TV signals,
via Cable TV, HITS, DTH and IPTV platforms, since 2004. However, to date there
have been different interconnection rules applicable for Cable & DTH platforms.
There have been many inconsistencies in the rules for different platforms,
and matters have been taken to court by aggrieved parties. The Courts have
asked the TRAI to take a complete fresh and consistent view and declare new
In October 2016, the TRAI has called for a consultation on its Draft Telecommunication (Broadcasting and Cable Services) Interconnection (Addressable Systems) Regulations, 2016. This new regulation has 2 highlights:
1. The Rules will be common and apply uniformly to Cable TV, HITS, DTH & IPTV platforms.
2. The Carriage Fee will be regulated and capped.
3. The minimum commission payable by TV Channels to distribution platforms.
the same rules will apply to all Digital Platform Operators (DPOs are DAS
MSO, HITS, DTH & IPTV operators).
feels the interconnection regulations must maintain the fundamental underlying
principles of non-discrimination & a level playing field.
is a "Must carry" provision for all addressable systems, on first
come first serve basis.
The TRAI has proposed standard formats for distribution platforms to ask broadcasters for signals, as well as a format for a 'Subscription Report' they must provide to all broadcasters, including free to air channels.
offer to a distributor (DPO), a minimum of 20% of the maximum retail price
of its pay channel(s) or bouquet(s) of pay channels as distribution fee.
They may also
offer discounts on the maximum retail price provided that the sum of discounts
and distribution fee in no case shall exceed 35% of the maximum retail price,
TRAI has specified 20 paise per (Standard Definition) channel as the maximum carriage fee per sub per month that can be charged by any DPO -
HITS, DTH or ISP platform. For HD channels the max carriage fee proposed is
400 paise per channel per subscriber per month.
fee rate must be uniform and non-discriminatory for all channels.
DPOs of TV channels
may offer discounts on the carriage fee rate declared by them not exceeding
35% of the rate of the carriage fee declared.
carriage fee falls further as the percentage of subscribers opt for that channel.
fee falls to zero if more than 20% of the subscribers opt for the channel.
no carriage fee can be charged for channels in the basic FTA package!
Table 1 Summarises the different slabs of maximum carriage fee that can be charged from a broadcaster.
Of Average Active Monthly Subscribers For A Channel
||Max Monthly Carriage Fee|
|Less Than 5%||20 paise / channel / sub|
|Between 5% & Less Than 10%||15 paise / channel / sub|
|Between 10% & Less Than 15%||10 paise / channel / sub|
|Between 15% & Less Than 20%||5 paise / channel / sub|
|20% or More||Zero|
Proposed Carriage Fee That Can Be Charged By Any CATV, HITS, DTH or IPTV platform.
NUMBER OF SUBS
TRAI has also attempted to bring in greater transparency via auditors, who will submit reports on the number of monthly subscribers.
Every DPO must submit to each TV channel broadcaster an accurate subscription report for channels or bouquets (in the prescribed format), within 15 days from each calendar month end.
If the DPO fails
to provide the subscription report within 15 days of month end, the broadcaster
will have the right to raise a provisional invoice for 10% + amount over the
can disconnect its TV signals (after 3 weeks' prior written notice) if the
distributor fails to provide the subscription reports for 3 consecutive months.
The broadcaster will raise invoices based on the subscription reports, clearly stating the current dues and arrears, if any, allowing at least 15 days to make payment. All arrears not listed for 3 months will lapse.
FOR CARRIAGE FEES
Similar provisions have been suggested for Carriage Fee invoices.
Every DPO must carry out an annual audit of its SMS, CAS, and other related systems. This audit report must be shared with each broadcaster.
TRAI itself may empanel auditors for this purpose and the distributors will have to compulsorily get the SMS audited by these.
If a broadcaster is not satisfied, it may get an audit carried out not more than once in a calendar year.
Comments have been invited from stakeholders by 28 October 2016. The TRAI will post all comments received on its website. After considering these comments, TRAI will issue its final Interconnection Regulation 2016. We will provide a detailed review for our readers of the final regulation declared by TRAI.