Hathway-MSM row intensifies as both parties decide not to renew contracts

While Hathway states poor ratings of MSM channels as the reason for not renewing the contract, MSM insists that it has in fact blocked the signals of its channels for non-payment of dues by Hathway

BestMediaInfo Bureau | Mumbai | August 20, 2015

The Hathway Cable & Datacom and MSM dispute has intensified with both parties deciding not to renew their interconnect agreements.

On August 14, 2015, TDSAT (Telecom Disputes Settlement and Appellate Tribunal) had ordered Hathway to pay Rs 14.56 crore outstanding subscription fees to Multi Screen Media Distribution for DAS Phase 1. The contract for Phase 1 expires on October 31, 2015.

Following this, Hathway has decided not to renew the contract with MSM due to the “unappealing content” of its channels and continued decline and inconsistency in ratings, as per a press release issued by Hathway.

“Dipping ratings and average content cannot be a base for a broadcaster to take distribution platforms for a ride by demanding hefty growth year on year. In fact, it requires major correction in the subscription fees that the broadcaster charges. The concern with Sony Entertainment Television, the flagship channel of Multi Screen Media (MSM), has been witnessed over the last year wherein their content lacks appeal and demand as compared to other leading networks and does not deserve a growth, which was raised by us to the broadcaster. All the other channels in the MSM bouquet are also irrelevant and don't offer any compelling content,” a Hathway spokesperson stated in the release.

As per the release, recent figures reinstate the fact that the flagship channel, Sony Entertainment Television has been on the decline in all major DAS and HSM markets.

Hathway has cited BARC ratings released for Week 31 of 2015 (August 1-7) for CS 4+ All India, which show Sony Entertainment TV at 5th position with double-digit GRP of 77, compared to other GECs like Star Plus (197 GRP), Colors (157 GRP), Zee TV (122 GRP), Life Ok (106 GRP).

The release further stated that Hathway has taken a decision not to renew its contract with MSM in DAS 2 markets where it has expired based on the above reasons. In DAS 1 markets, where the contract expires on October 31, 2015, Hathway will offer MSM channels on ala-carte basis to the consumers and not as part of any of the packages till the expiry of the contract.

“MSM had moved to TDSAT and filed a petition against our move to shift their channels to ala-carte. We are happy to state that TDSAT dismissed MSM's petition vide order dated August 14, 2015,” the Hathway spokesperson added.

Makarand Palekar

Meanwhile, when contacted, Makarand Palekar, EVP – Sales and Marketing, MSM Media Distribution, refuted Hathway's claim that TDSAT had dismissed MSM's petition vide order dated August 14, 2015.

According to Palekar, “We have switched off our signals and until they clear our dues, we are not going to renew any agreement. The outstanding dues are huge and there's no way that we can give them signal on RIO (RIO Reference Interconnect Offer). Rs 50-60 crore is a huge amount and even if they want to show my channels on RIO, the regulator clearly states unless they clear our dues, they will not be able to get any service from us.”

When asked to comment on the line of reasoning (poor ratings of Sony) given by Hathway to not renew contracts, Palekar replied, “This is just retaliation. I don't want to get into any retaliation game. The situation at hand is very simple, we are not giving them our channels till they clear our dues.”

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