Press Release on NTO 2.0 provides freedom to stakeholders to price their services while ensuring freedom to choose channel to customers, Sound growth of sector expected.
This News is Brought You By www.satiitv.com
TRAI issued amendments to the regulatory framework for Broadcasting & Cable Services Sector on 1st January 2020.
New Tariff Order (NTO – 2.0) facilitates TV Viewers / Subscribers to choose channels of their choice either as a-la-Carte or bouquet of channels, it also ensures that prices of a-la-carte channels are not illusory. TV Viewers / Subscribers can now choose 200 channels of their choice excluding mandated Prasar Bharti channels in maximum Network Capacity Fee (NCF) of Rs 130/- per month. Relief has also been given to Multi-TV home subscribers as they would pay only 40% of NCF for every second and additional TVs in a home. The concerns of Free To Air, News and regional broadcasters have also been addressed by capping maximum carriage fee payable by a broadcaster to a DPO for a TV channel per month. MSO, IPTV providers, HITS operator has also been mandated that their target market cannot be more than state or Union territory, as the case may be. Concern of all the broadcasters regarding placement fee and misuse by few DPOs manipulating Electronic Program Guide (EPG) has also been addressed.
Broadcasters continue to have full flexibility to price their channel as Maximum Retail Price (MRP) of any channel remains in forbearance. NTO2.0 prescribe linkage between A-la-carte price & Bouquet by mandating that sum of the A-la-carte channels in a bouquet will not be more than 1.5 times to that of bouquet price. It has also prescribed condition that MRP of a a-la-carte channel should not be more than Rs 12/- per month to be part of the bouquet which was Rs 19/- earlier. These steps become necessary to curb misuse of pricing facility by few broadcasters. It is important to mention here that after implementation of NTO, some broadcasters enhanced their channel prices drastically, which in large number of cases were more than 100%. Such price increase is anti-consumer and forces regulatory interventions. TRAI believes that transparent mechanism needs to be adopted to encourage market discovery of channel price, but any attempt to scuttle consumer choice either through nontransparent pricing practices or other similar means need to be discouraged.
The amendments through NTO2.0 have left the basic structure of the regulatory framework unchanged with very minor modifications targeted to address teething problems relating to smooth implementation. It provides complete freedom to Broadcasters/ DPOs to price their services while ensuring that TV Viewers / Subscribers get freedom to choose the TV channels. The review exercise has been limited to certain consumer friendly measures including those which are necessary to balance the interest of stakeholders. Summary of these new measures is as below:
At present, TV Viewers / Subscribers can enjoy 200 SD (plus mandatory channels) television channels in basic NCF of Rs. 130/- per month. Further even for higher number of channels the maximum NCF has been capped at Rs.160 per month. This will also benefit broadcasters, especially News & Regional FTA channels, as there are higher chances of subscription of their channels.
Reduction of ceiling price of pay channel for inclusion in any bouquet from Rs.19 to Rs.12 so as to ensure fair packaging of bouquets. This will ensure reasonable price of a channel on A-la-Carte basis.
Flexibility to DPOs to declare different NCFs for different regions/areas within its service area. This provision will help DPOs to innovate and cater to local demands in their tariff offerings resulting in lower NCF in rural/remote areas.
Flexibility for DPOs to offer promotional schemes. They can also offer discounts on NCF and Distributor Retail Prices (DRP) on long term subscriptions, having duration 6 months or above.
Capping of the carriage fee Rs. 4 Lakh per Standard Definition (SD) Channel per month for a DPO. This will ensure viability of news, regional and niche channels.
Full flexibility to the DPOs to organise the television channels on EPG based on Language or Genre.
The amendments provide appropriate time to stakeholders for implementation. Broadcasters may publish revised MRP of a-la-carte channels and bouquets by 15th January 2020. Similarly, DPOs may publish revised offerings on their website by 30th January, 2020. TV Viewers / Subscribers will be able to benefit as per the amended provisions with effect from 1st March 2020. The amendments will give better offerings, reduced NCF, more flexible tariff schemes and more choices for consumers.