Audit nightmare: Broadcasters demand reforms as DPOs defy TRAI regulations

New Delhi: The open house discussion (OHD) organised by the Telecom Regulatory Authority of India (TRAI) on Thursday over the audit of DPOs witnessed a few stakeholders demanding stringent measures for DPOs defaulting on the mandated audit as per the provisions of TRAI’s Interconnection Regulations, 2017.

In the OHD, virtually boycotted by broadcasters, Manoj Chhangani, Secretary General, All India Digital Cable Federation (AIDCF), strongly stated that broadcasters should be “strictly prohibited from providing any TV signal to the MSOs (Multi-system Operators) who are not doing the audit.” 

He also suggested that broadcasters should share a list of defaulters on their websites. 

Girish Bhuttan, Head of legal and regulatory department, SITI Networks, echoed Chhangani’s view and recommended strict actions against the DPOs and MSOs failing to comply with the regulations pertaining to the audit. 

“We suggest some financial fine for the defaulters. If they fail to adhere to conduction for more than two times, their license should be cancelled,” he said.

However, Bhutan added that the problem lies in the implementation. 

“We have not seen any actions taken against these guys who are not implementing these provisions. If it's not being implemented properly, the provision loses its importance,” said Bhuttan. 

In his counter, Gopal Ratnam, Secretary, Consumer Care Society, resorted to the “tried and tested” formula of terming any action against DPOs anti-consumer move.

“The audit clauses are part of regulation. Even as TRAI comes out with a recommendation on audit, it is less likely that it will be implemented in its true letter and spirit. As soon as a broadcaster switches off the signal for non-compliant DPOs, they will approach TDSAT and get a favourable order,” said a broadcast veteran.

“The irony is that the owners of the product, which is content in the case of the broadcast sector, cannot even decide who and how to sell their products. This is unheard of in any other industry. This kind of welfare is the government’s job and not the corporates. Can a corporate business be forced to sell its product for free or at a lesser price to unorganised, non-compliant and non-paying distributors in the garb of consumers?” the veteran quipped.

There was a time when the cable operators were the only pipe to distribute the content. Today, there are several avenues including OTTs and "Fast channels" to reach the target audience. 

“If the consumer opts for alternative mediums, then also the DPOs cry foul and find ways to trouble broadcasters. The case in point is cable operators’ complaint to TRAI over OTT pricing,” said another senior broadcast executive.

When asked why broadcasters were not present in the OHD to put forward their points to counter DPOs, the executive said that the broadcasters have probably realised that it is better to stay away from unnecessary confrontation and shouting matches.

“DPOs have better lung power and more importantly why would we as the owners of the product get into arguments with the distributors?” the broadcast executive posed.

“Denying or delaying an audit is akin to saying that you have given your product and now forget about it. How can cable operators be allowed to say this,” he quipped.

In the last five years, it was alleged that proper audits were not conducted in about 90% of cases. 

An industry observer told BestMediaInfo.com that the DPOs come out with different excuses each time.

“Some will say their software is not working. Some will say they don’t have staff. Some even go to the extent to say that their head end caught fire. Then they will send an audit report on their own which is not even in the prescribed format by TRAI. When you disconnect the signal, they will move to TDSAT. The tribunal does not believe an audit can be a reason for disconnection. That’s the modus operandi,” the industry observer explained.

This has forced broadcasters to believe that all the efforts towards drafting a recommendation are futile or unproductive, the industry observer added.

Additionally, the broadcasters have been raising the issue of training for the auditors who are largely the empanelled CA firms.

“TRAI does not impart training to these auditors regarding the industry. Moreover, these auditors send their article trainees for the audits who keep changing every six months. What kind of audit report do you expect in this scenario?” said the industry observer.

For this reason, the Indian Broadcasting & Digital Foundation suggested reforming the clause and giving primary rights to broadcasters to conduct audits for DPOs. 

Radhakrishnan Nair, Secretary, IBDF, stated that this might lift the burden on small DPOs to conduct the audit. 

“DPOs often fail to conduct audits, submit incomplete or inaccurate reports, or delay the process, hindering broadcaster’s ability to verify subscriber numbers and the integrity of the system used. This lack of transparency negatively impacts broadcasters’ revenue as well as the public sector. To address this, broadcasters should have the primary right to audit DPOs,” said Nair.