TRAI directs broadcasters to offer non- discriminatory pricing for all their channels

The broadcasters have also been asked to specify the a-la-carte rates offered to multi system operators or cable operators

BestMediaInfo Bureau | Mumbai | May 12, 2016

The Telecom Regulatory Authority of India (TRAI) has recently directed broadcasters to offer non-discriminatory pricing for all their channels on a a-la-carte basis to multi system operators or cable operators, as the case may be. The broadcasters have also been asked to specify the a-la-carte rates, subject to provisions of sub-clause (2) of this Clause in the Tariff Order and Clauses 3 and 38, for each pay channel offered by them.

Clause 3C of the Tariff Order 2004 reads, “In case a broadcaster, in addition to offering all its channels on a-la-carte basis, provides, without prejudice to the provisions of sub-clause (1), to a multi system operator or to a cable operator, pay channels as part of a bouquet consisting only of pay channels or both pay and free to air channels, the rate for such bouquet and a-la-carte rates for such pay channels forming part of that bouquet shall be subject to the following conditions, namely:- (a) the sum of the a-la-carte rates of the pay channels forming part of such a bouquet shall in no case exceed one and half times of the rate of that bouquet of which such pay channels are a part; and (b) the a-la-carte rates of each pay channel, forming part of such a bouquet, shall in no case exceed three times the average rate of a pay channel of that bouquet of which such pay channel is a part and the average rate of a pay channel of the bouquet be calculated in the following manner, namely:-

“If the bouquet rate is Rs. X' per month per subscriber and the number of pay channels is 'Y' in a bouquet then the average pay channel rate of the bouquet shall be Rs. X' divided by number of pay channels 'y'.”

A broadcaster may offer discounts to multi system operators and cable operators on a-la-carte rates of its channels or bouquet rates and other such discounts, provided they do not contravene the provisions of sub-clause (2) or any other provisions of the Tariff Order.

Sub-clause 2 of Clause 4 of the Tariff Order, 2010 has different conditions in it. It says, “In case a broadcaster, in addition to offering all its channels on a-la-carte basis, offers, without prejudice to the provisions of sub-clause (1), pay channels as part of a bouquet consisting only of pay channels or both pay and free to air channels, such broadcaster shall specify the rate for each such bouquet of channels offered by it.”

The conditions stipulated on broadcasters include:

(a) the composition of the bouquets offered by the broadcaster to distributors of TV channels using addressable systems will be the same as those offered by such broadcaster for non-addressable systems, and

(b) the rate for a bouquet of channels for addressable systems will not be more than thirty-five per cent of the rate for such bouquet as specified by the broadcaster for non-addressable systems.

While Clause 3C in Tariff Order 2004 allows broadcasters to provide their channels on a-la-carte basis to the multi system operators (MSOs) and cable operators as per their request, the Tariff Order of 2010 defines bouquet or bouquet of channels as an assortment of distinct channels offered together as a group or as a bundle. Bouquet rate or rate of bouquet means the rate at which a bouquet of channels is offered to the distributor of TV channels or to the subscriber, as the case may be.

Clause 4A of the Tariff Order 2004 specifies that the TRAI had the authority to intervene should broadcasters not comply with its directive. The Clause reads, “The Authority may, by order or direction made or issued by it intervene in order to secure compliance of the provisions of this Tariff Order, or protect the interests of subscribers and service providers of the broadcasting services and cable services} or promote and ensure orderly growth of the broadcasting services and cable services} or facilitate competition and promote, efficiency in the operation of broadcasting services and cable services so as to facilitate growth in such services.”

Clause 10 of the Tariff Order 2010 also reiterates the authority of the TRAI. It reads, “The Authority may, by order or direction made or issued by it, intervene in order to secure compliance of the provisions of this Tariff Order, or protect the interests of subscribers and service providers of the broadcasting services and cable services, or promote and ensure orderly growth of the broadcasting services and cable services.”

The TRAI directs all the broadcasters of pay channels to strictly comply with the provisions of Clause 3C of the Tariff Order, 2004 and Clause 4 of the Tariff Order 2010 when it provides signals of TV channels including in term of CPS agreements to protect the interest of service providers and consumers.

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