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IBF resists Nepal Govt’s ‘clean feed policy’ for foreign broadcasters

IBF held a series of discussions with Nepal Government officials to apprise them on the possible fallout of the proposed policy and its likely impact on the economic development of the country

The Indian Broadcasting Foundation (IBF) has tried to convince the Government of Nepal to defer the designated date for the implementation of its Clean Feed Policy.

The ‘clean feed policy’ forces foreign channels being distributed in Nepal to not contain any advertisements. The Government of Nepal wants to implement the Clean Feed Policy from July 16, 2017. According to the policy, downlinking licences of foreign broadcasters will be given only if the no ad policy is implemented.

To apprise the Government of Nepal on the possible fallouts of the proposed policy and its likely impact on the economic development of Nepal – particularly from the point of view of loss in revenue and employment in the country – the IBF has had a series of discussions with Nepalese officials. During the discussions, the technical and economic unviability of the proposed Clean Feed Policy was conveyed. Broadcasters also conveyed that consumers and various distribution platforms in Nepal would be adversely affected in case the proposed policy is implemented on the designated date.

Some of the major points of discussions were:

(a)  It was highlighted to the Government of Nepal that any such policy ought to be framed only after holding transparent and holistic consultations involving all stakeholders in an environment where digitisation of distribution networks has been completed and issues relating to implementation of anti-piracy laws have been put in place. None of these is accomplished in Nepal, presently.

(b)  Launch of clean feed would inter-alia entail separate playout, uplink and downlink costs. Nepal being an emerging market with very low ‘average revenue per user’ (“ARPU”), such exorbitant costs to create clean feeds are not justifiable from a business viability point of view.

(c) Due to unviable business proposition, it is felt that distribution channels may face discontinuation leading into rampant piracy all over Nepal. It was highlighted that cable operators may resort to using Indian DTH connections to re-distribute the signals. Further, in such a situation, viewers too may start buying Set-Top Boxes (STBs) and viewing cards of Indian DTH operators without knowing that the same may have been smuggled into Nepal.

(d)  The demand for ‘clean feed’ is at variance with and may be counter-productive to Government of Nepal’s laudable initiative for implementation of digitisation of distribution networks. This is so because digitisation is a cost-intensive exercise and any discontinuation of channels on account of implementation of the clean feed policy ought to have an adverse impact on revenues of cable operators (thereby affecting their ability to invest monies for digitisation). It was submitted that such impact can have a cascading effect on the survival of distribution platforms as a chain reaction, affecting employment locally and also distribution / reach of local Nepalese channels.

(e) The Government of Nepal should first allow implementation of digitisation before proceeding to evaluate need for introduction of a clean feed policy. It was highlighted that digitisation with addressability is a potent tool to keep in check on unaccounted cash transactions, which may not only cause losses to distribution platforms and broadcasters but also to the Government exchequer in the form of lost taxes.

(f)   Proper and effective implementation of digitisation will give an insight to broadcasters on the type of content being consumed, and as a consequence, they will be able to evaluate consumer choice better. From Government’s point of view, digitisation will also afford a line of sight on content being distributed in Nepal, revenues being generated by distribution platforms and consequential licence fees/ taxes that they are paying. Such licence fees/ taxes can be utilised by the Government inter-alia towards cross-subsidising expenses of Nepalese broadcasters or other initiatives.

Girish Srivastava, Secretary General of IBF, appealed, “The Government of Nepal ought to defer implementation of the clean feed policy until implementation of digitisation so as to evaluate best ways to take advantage of the same as is being done by other countries. Meanwhile, with the renewal of channel licences due on July 15, 2017, we would request the Ministry of Information and Communication (MOIC) to allow existing/new channels to be distributed without the clean feed condition – with the understanding that the licence shall not be withdrawn for at least till the next term is due.”

Srivastava stated, “The entire Indian broadcasting fraternity attaches a great degree of significance to the existing deep cultural, linguistic, social, economic ties between the two nations and its commitment to further the same in times to come.”

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