TRAI draft audit rules: Broadcasters decry dilution, DPOs slam on-site access

New Delhi: The Telecom Regulatory Authority of India’s draft amendments to the interconnection regulations have opened up a sharp divide in the TV distribution ecosystem. 

Broadcasters have objected to what they call an “erosion” of their audit rights and weaker anti-piracy safeguards, while leading cable/DTH distributors have opposed the idea of broadcaster representatives attending audits inside their facilities.

The draft nevertheless locks in two structural changes, shifting audits to the financial year with a 30 September deadline and enabling infrastructure sharing with a “two logos” watermarking rule, that are set to shape compliance from April 1, 2026. 

TRAI had put the draft Seventh Amendment in the public domain on September 22 and extended the comment deadline to October 14 after industry requests. 

What the draft changes

The amendment requires every distributor to get its addressable systems audited once every year for the preceding financial year and share the audit report with all contracted broadcasters by September 30. 

It also introduces a process under which, if a broadcaster disputes the audit, the matter can escalate to a special audit cleared by TRAI, with the broadcaster footing the bill and the distributor choosing one auditor from three names proposed. 

If systems are found non-compliant with Schedule III or X, broadcasters can disconnect signals with three weeks’ notice. 

A controversial new proviso lets broadcasters depute one representative to attend the audit “for sharing inputs,” while making it optional for distributors with ≤30,000 active subscribers to undergo the annual audit. The draft also carries forward the long-standing reference to BECIL within the auditor framework. 

On infrastructure sharing, the draft mandates separate instances and data segregation in shared SMS/CAS or SMS/DRM setups and says “preferably only two logos”, broadcaster and last-mile distributor, should be visible at the consumer end. 

What distributors want changed

Tata Play has asked TRAI to drop the clause allowing broadcaster representatives at on-site audits, citing confidentiality risks, operational disruption if “multiple” broadcaster reps arrive, and the potential to “over-power” the auditor. 

It has also sought a one-time dispensation to complete its 2025 audit on a calendar-year basis and then align to the financial year from 2026. 

DEN Networks mirrors the opposition to on-site broadcaster presence, arguing inputs can be sent electronically and warning of confidentiality breaches if 15–20 representatives land at premises. 

DEN also opposes the ≤30,000 audit exemption, calling it a transparency risk that could be gamed by splitting entities; it pegs the annual audit cost for small systems at “around Rs 75,000–1 lakh,” terming it proportionate. DEN further urges public naming of non-compliant DPOs and encourages broadcasters to use the disconnection power if audits are not completed. 

The All India Digital Cable Federation (AIDCF) backs stronger auditor accountability, asking TRAI to provide for blacklisting/suspension of errant empanelled auditors and allow such auditors to be impleaded in disputes if their negligence materially affects findings. 

It also proposes rationalising the annual audit, do a subscription audit each year and a full compliance audit only when hardware or system infrastructure changes, while supporting public disclosure of non-compliant DPOs and using disconnection where audits are not done. 

What broadcasters object to

The Indian Broadcasting and Digital Foundation (IBDF) says giving the DPO the right to pick one auditor from the broadcaster’s three nominees, and escalating to a TRAI-appointed auditor if the DPO does not choose, creates a conflict and a de facto veto over broadcaster-initiated audits, especially since the broadcaster pays. 

IBDF also flags the specific mention of BECIL as creating a perception of preferential treatment. 

On watermarking, IBDF argues the phrase “preferably only two logos” weakens traceability in shared networks and wants mandatory, non-overlapping logos of broadcaster, infrastructure provider and last-mile DPO, with a tested technical layout and a regulatory sandbox before rollout. 

The News Broadcasters & Digital Association (NBDA) goes further, calling out “preferential endorsement of BECIL” in the fourth proviso to Regulation 15(2)(a), terming it distortionary, and urging that watermarking requirements mandate all three logos to be visible. 

NBDA also warns that the ≤30,000 exemption without safeguards could trigger revenue leakage and seeks weekly raw data submissions and an undisputed broadcaster audit right for such DPOs. NBDA has asked TRAI to withdraw the draft and take up audits and infra-sharing as part of the promised holistic review.