While the Indian Broadcasting Foundation (IBF), along with a few large broadcasters, approached the Bombay High Court against the amendments in the New Tariff Order, the Telecom Regulatory Authority of India (TRAI) held a press conference in Delhi to convey its conviction on the steps it had taken to fix a few concerns raised by stakeholders and consumers. A confident TRAI Chairman RS Sharma and Secretary SK Gupta said they were not aware of any such case filed by broadcasters but said they were ready to fight it legally.
BestMediaInfo.com spoke with Gupta to understand the real issue behind the clash between TRAI and IBF. A clear sense was that TRAI is against the monopoly and non-level playing field created by big broadcast networks, which is killing both smaller broadcasters and consumers.
You say a GEC used to be in the range of Rs 8-10. But wasn’t that pre-NTO?
Five broadcasters who own and operate about 200 pay channels have increased the price of their main channels by more than 200%. The b2b rate is called RIO and if you multiply it by 1.25, it becomes MRP. The new MRPs in the new regime were more than double over the old MRPs.
The discounts will benefit the consumers, won’t it?
Take the example of your mobile. If you tell the price of your mobile, which is technically fixed, and then give the discounts as much as you want, we have no business. But where the price is not known and you quote a price whatever you want, and then you say you are offering discounts in a bouquet, this is unfair.
If I am offering more than 50% discount on a bouquet but I do not want to discount on a la carte, it means that you did not fix the right price for a la carte and that is why you are offering huge discounts in the bouquet.
If there was no limit for MRP, why did broadcasters not price it beyond Rs 19?
You could fix an MRP of Rs 2,000 if that was not a part of any bouquet. Rs 19 was the upper limit for being a part of the bouquet, which has now been reduced to Rs 12. They might not be confident that their channel has enough pull to be bought standalone. And they went ahead with pricing set for the bouquet.
All we are saying is that the consumer must have the option to choose; don’t hide facts and push your channels to them.
A consumer goes to a shop and chooses to buy something at Rs 500. But if the shopkeeper says you will have to buy something else along with what you wanted, that is not fair.
If broadcasters would have not formed any bouquet and given discounts, won’t the bill for the consumer increase?
It is their choice. We do not have any problem. You need not worry about the consumer’s bill.
You must keep the fact in mind that two-thirds of revenue comes from advertisement and one-third from subscriptions. If you price your channel at Rs 19, consumers will reject it and your advertising revenue will also fall drastically.
It is not one way. An advertiser gives you double of what you earn from a viewer. If you increase prices drastically and the content is not that good, consumers will not buy that. And if your consumers are ready to pay, why are you stopping them?
If the second-rung channels and the niche channels are trying to survive through the bouquet, why should TRAI have any problem with that?
No. We don’t have any problem. But the issue is that it is killing the similarly placed and regional channels by creating a non-level playing field. The treatment should be the same for all. There are 328 more broadcasters who are dying because of a few broadcasters. Because you say that you have a powerful channel and a consumer will have to forcefully buy 10 more channels with that. Smaller broadcasters cannot offer that and you fill the capacity with your 10s of channels.
And look at the way you create channels. You create channel No. 1, No. 2 and No. 3 with the same content. Shouldn’t other players have the right to survive?
Big broadcasters came together on Friday and have gone to court. What are your thoughts on that?
You are more concerned about that than the 200% price increase on channels. There are frameworks. We will fight legally. The Supreme Court’s observations on the same were read out earlier by the chairman.
But TRAI withdrew its case from Supreme Court to roll out the NTO!
This is wrong news. Go and check with the Supreme Court whether it has happened or not. The reality is that we did not file any such case assuming that these broadcasters will adopt some sort of proper strategy understanding the consumers’ concern under the new framework. They have not understood and started behaving in the same manner.
If you exploit any freedom given to you, we will have to tighten the framework. This is a common process of any regulation.
You do extensive exercise for any such regulation but why are there clashes every time?
If you are taking the wrong advantage of the framework that is harming the consumer badly, we will have to intervene. If you think that you have the power of 200 channels and can do anything you want, then we will have to tell you where you are going wrong.