DPO vs Broadcaster: What’s really fueling Pay TV’s slide?

New Delhi: The ongoing imbroglio involving two top DTH players and two leading broadcast networks is widely seen as an accelerant for a phenomenon that is detrimental to the broadcasting industry—cord-cutting.

Tata Play and Sony Pictures Networks entered into a dispute affecting consumers beginning May 21, when the DTH platform removed Sony channels from its base pack.

Twenty-five days later, the fierce battle between the two shows no sign of ending soon—unless one party blinks, given the upcoming India-England bilateral cricket series later this week.

A fresh standoff began last week between Airtel Digital TV and Zee Entertainment channels.

In any dispute between a broadcaster and a distribution platform operator, both parties attempt to run down each other, either in public or in the courts.

Broadcasters cite the decline in the number of subscribers, whereas DPOs retort by questioning the quality of content, resulting in a drop in viewership and consumer demand.

But before dissecting their respective claims, it is imperative to understand what plays out behind the scenes. Typically, such differences begin with either a price hike by the broadcaster, facing resistance from DPOs, or overdue payments.

When we talk about a price hike, it is not necessarily related to the MRPs of a channel. Instead, it refers to the increased subscription revenue that the broadcaster seeks from DPOs at the time of the deal.

The RIOs for FY2026 have largely been signed by all stakeholders in the broadcast ecosystem, and any broadcaster seeking a fee hike is required to republish a new RIO and renegotiate the deal with DPOs.

Considering it is already May-June, this does not seem to be the case, unless there are exceptions.

On the face of it, the issue appears to be non-payment of overdue amounts, as confirmed by the TDSAT order which directed Sony to accept Rs 40 crore against a demand of Rs 300 crore and keep quiet. The broadcaster then approached the Bombay High Court.

The matter between Airtel Digital TV and Zee Entertainment is said to be similar.

While the matter in court specifically concerns non-payment, both DTH operators have resorted to running down the broadcasters. Ironically, DTH players fully rely on broadcasters’ content to acquire and retain subscribers.

There is a lot to be said outside court, especially for the purpose of setting a narrative to pacify or influence subscribers. And, the narrative has remained standard over the years.

Tata Play MD & CEO Harit Nagpal told Storyboard18, “We observed that there’s a wide gap between channels people subscribe to and the ones they watch. Often, when channels are bundled, people pay for all but watch only one or two. We particularly monitor customers who are slow to recharge—5, 7, sometimes even 15 days late. That’s an indicator they don’t see value in what they’re paying. We remove channels for users who are least engaged, but also offer them a way to bring it back.”

Airtel Digital TV issued a similar clarification, stating, “Due to recent changes in broadcaster tariffs, Zee Network channels will no longer be part of the Airtel DTH base packs. These pack prices will be adjusted accordingly. All Zee Network channels are available on Airtel DTH and can be added individually to the list of subscribed channels at their respective MRPs via channel selection options.”

An AIDCF-EY report titled “State of Cable TV Distribution in India,” released last week, revealed that the reach of pay TV homes has reduced by 40 million to 111 million in the last seven years, which includes pirated and underdeclared connections.

The report acknowledged that while Indian TV homes have reached 190 million, the mix of methods used to deliver content has changed significantly.

DPOs are aware of changing consumer behaviour, yet they still find it reasonable to risk driving more subscribers away from linear TV by troubling them with such boardroom battles.

On the DPOs’ charge that broadcaster content quality is responsible for their decline, it may be partially true when compared with OTT content.

TV content is still highly regulated by the Programme and Advertisement Codes prescribed under the CTN Act, 1995. In contrast, OTT has the freedom to experiment with content.

There has been a chorus around reducing regulatory burdens on TV content, which has remained ineffective so far.

With the growth of digital consumption, led by the overall shift in consumer behaviour, broadcasters have increased their focus on OTT content, which is growing at the fastest pace—around 40%, much above the growth of all mediums combined.

But does this mean that they are compromising on content quality for television? There is no evidence to support this charge.

The migration to digital is real, and if overall pay subscription declines, viewership is set to drop.

Had the viewership dropped drastically, advertisers would not have allowed them to charge the same advertising rates.

Not only broadcasters but DPOs also understand well that linear TV remains a key medium when it comes to family entertainment, at least beyond megacities. OTT is yet to travel miles to catch up in that space.

In such a situation, the loss of even a few subscribers is a big blow to the entire pay TV ecosystem.