February 2010

NO MORE NEW TV CHANNELS

Last month, our news pages indicated that the I&B ministry had directed the TRAI to review whether there should be a ceiling on the total number of TV channels to be licensed by the Indian Govt.

"TRAI has been requested to examine the number of channels which can be permitted in the country keeping available spectrum and transponder capacities as well as technological developments and general practice internationally," I&B Minister Ms Ambika Soni explained to the upper house. She pointed out that there were as many as 512 private satellite TV channels had been permitted under uplinking and downlinking guidelines. Another 152 applications are awaiting permission to uplink from India and 14 applications are pending for permission to downlink from India, Soni added.

A need is felt to revisit the present policy for uplinking and downlinking with respect to the approach towards grant of permission including the eligibility criteria and the terms and conditions of the permission, an I&B ministry official clarified.

The I&B ministry is reported to have have written to the TRAI Chairman Mr. JS Sarma, in early October 2009.

18 JAN ORDER

In its notice dated 18 January 2010, the I&B Ministry has declared "Pending receipt of TRAI's recommendations on the issues and decisions thereon, it has been decided to suspend receiving applications for permissions to uplink TV channels from India and downlink TV channels in India under uplinking/downlinking guidelines with immediate effect, till further notice."

For our readers, we have reproduced the exact content of the I&B Notice in English. The Hindi version is a loose translation by this magazine.

PENDING APPLICATIONS REJECTED ?

There is no mention whether the more than 150 new TV channel applications already submitted will be processed ? Will even those applications be stalled / rejected, requiring them to be re-submitted as per the new norms to be declared?

STRONG REACTIONS

The I&B ministry's move has met with strong reactions from the private sectors.

Industry observers point out that the freedom to set up satellite channels is part of an uncensored press. More than 50% of all existing channels are infact registered and authorised as News channels.

NO SPECTRUM SHORTAGE

Satellite broadcasters have been quick to point out that there is no scarcity of satellite spectrum. infact the same C Band downlink spectrum can be used by all satellites in the region, and their frequency coordination is infact checked before the satellites are launched.

There is still adequate C band transponder capacity available over the country. Hence the I&B ministry's statement does not seem to hold water.

COERCION?

Some press reports speculate that the I&B ministry's freeze is probably the outcome of complaints from elected representatives and states that channels were indulging in threats and blackmail tactics instead of dissemination of information. These issues have actually been linked to politically backed and linked channels.

More than a year ago, the TRAI had recommended that political parties and state governments should not be permitted to launch their channels through the private sector. The government has so far ignored these recommendations, and it seems unlikely that political will exists to change the situation.

INDUSTRY VIEWS

Reacting to the latest notice, Indian Broadcasting Foundation (IBF) President Jawahar Goel said, "We will put forth our views to TRAI in the consultation process." TRAI has already issued a consultation paper on the issue. The directive may be a setback for some media houses, which were planning to launch new channels, but the suspension may be temporary, Goel said.

SECOND HAND CHANNELS?

If the freeze on new channels continues for long, broadcasters may consider buying out existing channels that are practically defunct, but have a valid operating license. The channel could be re-launched or even rebranded by the new owners

CARRIAGE FEES

Carriage fees have been a legitimate form of revenue for DTH platforms and Cable TV networks. Major India DTH platforms reportedly charge Rs 3 to Rs 5 Crore per channel per year as carriage fee. Given the large number of channels, the carriage fee has been increasing steadily and carriers have a wide selection of channels to choose from, for carriage. The freeze on the number of channels, could stall the hike in carriage fees, though they are unlikely to reduce, since there are already more than twice as many channels compared to the current capacity of approx. 250 channels.

For now, all attention has shifted to the TRAI, for it to issue its recommendations on the topic. The consultation paper will almost certainly bring in a large number of diverse views from all industry segments. n