TRAI issued a consultation paper on Tariff-related issues for Broadcasting & Cable services. The regulator asked stakeholders for their comments & counter comments different questions which covered different aspects related to the New Tariff Order (NTO) that came into force from February 1, 2019.
The auhority raised three main issues in the consultation papers are whether channel bouquets should be allowed, should a cap on discounts within bouquets be reintroduced and whether the ceiling price of channels in bouquets Rs 19 at present needs to be re-examined.
If TRAI disallows Broadcasters, Distribution Platform Operators (DPOs) or Cable TV operators and DTH providers from assembling bouquets, this will definitely impact their business model as many smaller and less popular channels will not get enough audiences and lose reach & viewership, result in a further drop in advertising revenue.
TRAI believes that the New Tariff Order (NTO) was contemplated as a policy to give power of selection channels and choice for all TV Viewers / Subscribers. TRAI fixed Rs 19 as the MRP cap for channels under the NTO.
TRAI started this entire process with the idea that monthly Cable and DTH bill will come down as people will select only 15-25 channels, which has not been the case. Contrary to the regulator’s idea, in most cases monthly bills have increased. They have realised that they have created a mess and now blaming the Broadcasters and DPOs.
Broadcast sector may face another disruption in less than a year, this time may force many smaller and less popular channels and TV networks to shut, If TRAI has its way. The sector has already lost 10-12 million TV subscribers in the last five months as per various industry analytics after new tariff order and industry experts fear that this will kill the sector as distribution revenues will drop significantly at a time when advertising revenues are already under pressure.