AIDCF writes to Vaishnaw after MIB gave “Inadequate consideration” to DTH fee plea

New Delhi: The All India Digital Cable Federation (AIDCF) has made a fresh appeal to Union Minister Ashwini Vaishnaw, urging the Ministry of Information and Broadcasting to reject the Telecom Regulatory Authority of India’s (TRAI) recommendation to slash the Direct-To-Home (DTH) licence fee from 8% to 3%.

In a letter addressed to Union Minister Ashwini Vaishnaw, the AIDCF said its earlier representations on the same issue had not received “adequate consideration” from the ministry. The federation said it was forced to escalate the matter again, warning that the proposed fee cut would severely distort the level playing field between DTH and cable operators.

The federation argued that the TRAI’s proposed reduction, and its eventual plan to phase out the licence fee altogether, would deepen market imbalances, favour DTH players unfairly, and threaten the survival of over 880 Multi System Operators (MSOs) and 1.6 lakh Local Cable Operators (LCOs) nationwide.

“The federation has, on multiple occasions, sought to address this issue through formal representations, including the recent letter of 19th June 2025, but regretfully, the matter has not received adequate consideration,” AIDCF Secretary General Manoj P. Chhangani wrote in the letter.

AIDCF, in its previous letter, pointed out that the spectrum used by DTH players, 2,592 MHz for uplinking and downlinking, would amount to around  Rs 45,610 crore over 20 years if allocated via auction, instead of being given free of cost. The original licence fee, first set at 10% of Adjusted Gross Revenue (AGR) and later reduced to 8%, was intended to compensate for this free spectrum allotment, AIDCF said.

The letter also highlighted that cable TV operators face much higher operational costs than DTH players. The federation noted that cable operators pay Right of Way charges of up to Rs 3,000 per pole per year, permission charges to local authorities for overhead and underground cables, and capital expenditure of about Rs 8 lakh per kilometre for underground cabling. 

Additionally, AIDCF said, each customer acquisition costs operators about Rs 5,000.

In contrast, DTH operators, according to the AIDCF, incur minimal incremental costs for adding new customers and do not have sunk infrastructure costs in the event of subscriber churn. 

In the fresh communication addressed to Vaishnaw, the federation said, “We respectfully submit that the acceptance of this recommendation would have a devastating impact on the Cable TV industry, potentially leading to widespread shutdowns of operations among the 880 MSOs and 1.6 lakh LCOs across the country.

The resultant disruption would jeopardise not only the livelihoods of nearly 10 lakh individuals directly associated with the sector but also the affordability and reach of digital services in underserved regions.” 

AIDCF also raised concerns about the consultation process itself, stating that TRAI’s consultation paper of January 2023 did not include any specific question about reducing the licence fee from 8% to 3%. As a result, stakeholders were not given a direct opportunity to comment, which the federation claims compromised transparency.

AIDCF called on the Ministry to reject the proposal and maintain the existing licence fee, arguing that any fee reduction should account for the true commercial value of spectrum usage.

The federation has requested a meeting with the Minister to present its concerns in detail and has copied the letter to senior I&B officials, including Secretary Sanjay Jaju and Additional Secretary Prabhat.

“We would also like to respectfully seek an appointment and would be grateful for the opportunity to present the matter in greater detail. We trust that our request will merit your kind consideration,” AIDCF said in the latest appeal to the ministry.