Ending the hegemony of cable service providers, TRAI’s new regulations aim to empower the ordinary citizen who can now choose exactly what s/he wishes to watch
Years ago, a lucrative offer encouraging consumers to adopt Direct to Home (DTH) services, read: "Pay for only those channels which you wish to watch." But after selecting a plethora of different packs, including Entertainment, Sports, News, etc., subscribers ended up paying a hefty amount. They were also sold a bundled pack of 300 channels, which would cost between Rs 200 to Rs 450. Most channels of that bundled pack though would never be watched and subscribers would be forced to pay for unwanted TV channels.
So, the Telephone Regulatory Authority of India (TRAI), last December, came out with a new regulatory framework on broadcasting and cable services, which changed the pricing, plan and packaging policies of TV channels provided by operators like Airtel, Videocon, Tata, Dish and others. TRAI claimed that under the new regime, the consumer would be the king with an unhampered 'Power to Choose'. It also said that the new pricing norms were meant to promote affordability, and would reduce the monthly expenditure of Indian households on cable TV. Further, TRAI claimed that the new framework would curb the whims of service providers, bringing transparency in business, and also provide an even turf to DTH players while ruling out the unnecessary and constant dispute over pricing among operators. It assures that the regulation provides equal treatment to all broadcasters, multiple system operators, DTH operators and other platforms.
There are approximately 100 million cable service and 67 million DTH TV homes in the country. As this system of channel selection has been implemented in the country for the first time, many subscribers are facing challenges on migration. To this end, last month, the regulator extended the timeline for channel selection to March 31, 2019.
Under the new system, no service provider can force a subscriber to opt for unwanted or junk channels. Instead, the subscriber will have the freedom to choose and subsequently pay. All channels will be available as à-la-carte and bouquet. TRAI reasoned that if all channels are available à-la-carte to distribution platform owners (DPOs), they will not provide junk channels. Through the electronic programme guide (EPG), every channel will have an MRP mentioned on the TV screen. No distributor can charge more than the price decided by the broadcaster. There are two types of TV channels – Free to Air (FTA) and pay channels.
Payment to service providers will have two components. The first one is called Network Capacity Fee, which is a monthly rental charge levied for the TV connection. TRAI has prescribed a maximum of Rs 130 for the base plan. The other is the price of the channel selected by a subscriber.
Under the new framework, all operators must have a base plan of 100 channels, whose price must not exceed Rs 130 (excluding 18 per cent GST). The subscriber will have the liberty to deselect any channel available in the base plan and add Free to Air (FTA) or pay channels of her/his choice. As evident, if a subscriber chooses a pay channel, s/he will be charged the MRP on that channel in addition to the network capacity fee.
Moreover, if a subscriber wishes to choose more than 100 channels, s/he will have to pay NCF of Rs 20 for an additional 25 channels. Apart from this, MRP will be added to the bill for every extra channel s/he chooses. Most news channels are free-to-air. But customers will have to pay for a few leading news channels such as Aaj Tak, Mirror Now, NDTV 24x7 and CNN-News18.
To keep the price in check, TRAI has capped the price of channels in between Rs 1 and Rs 19. The MRP declared by all broadcasters will be identical for all service providers, i.e., if the consumers of two different service providers are watching the same channel, their monthly bill will be the same. According to TRAI's list, there are 330 pay channels and 535 FTA channels. TRAI has asked all service providers to show FTAs free of cost.
However, it is not mandatory to show all FTAs to the subscriber. The subscriber will decide which FTA s/he wants to watch. Nevertheless, it is mandatory to show all channels of Doordarshan. According to the new norms, no service provider can charge more than the capped price decided by the broadcaster, however, distributors have the liberty to provide discounted tariff plans. TRAI believes that broadcasters must reduce prices to retain viewers.
Further, SD and HD variants of the same channel cannot be in the same bouquet. The subscriber will have the right to change their plan every month. Also, s/he can select an additional channel at any time.
All cable and DTH providers have displayed channel and pricing details on their websites – here, a subscriber can choose a channel and make the payment digitally. This facility is also available through their respective mobile phone applications. In addition, a subscriber can also choose channels through the service provider's call centre.
Moreover, TRAI has launched a portal (www.channeltariff.trai.gov.in) which lists the price of all pay channels and packages provided by the broadcaster. Subscribers can use this portal to choose channels and calculate their monthly bill. Later, they can buy the same from their respective service providers. A TRAI official has said that they are planning to arrange the package buying facility on the TRAI website itself. Those who do not have access to the internet or are not comfortable using it can go to the nearest Point of Sale (POS).
Meeting the deadline
Those who fail to adopt the new system before the deadline of March 31, will be given a best-fit plan package of 100 FTA channels by their DPOs for which the customer will have to pay Rs 154.50, including GST. However, subscribers will be free to change their DPO provided plan at any point of time on or before March 31, 2019. Their desired pack will be activated within 72 hours of request submission. The best fit plan will be a blended combination of various genres and will be designed according to consumer usage patterns and language.
In case the subscriber already has an existing plan, then the best fit plan's price should be under the existing plan's price, and the balance amount of the existing package can be adjusted against the new package. "TRAI has clearly asked DPOs to ensure that for consumers, the monthly outgo under the best fit plat must not exceed the payout per month of existing plan of the subscriber," TRAI Secretary SK Gupta said last month.
If a customer has already paid for an annual plan, then the distributor is bound to provide the service for the remaining period without any change in tariff.
Whether the new norms will decrease the monthly bill of a subscriber depends on how many channels s/he chooses. According to the Broadcast Audience Research Council, 80 per cent of viewers watch either 40 or fewer channels. If a subscriber carefully selects channels for her/his family, s/he might end up paying lesser than whatever s/he had been paying until now.