Tag: carriage

Carriage fee in interconnect draft aimed at reducing litigation

NEW DELHI: The draft of the Interconnect regulations issued by the Telecom Regulatory Authority of India has given a formula for calculation of the carriage fee.

The carriage fee for each month or part thereof during the term of the interconnection agreement shall be calculated as given below:-

1. If the number of average active subscribers in a month for a channel in the target market is less than five percent of the average subscriber base of the distributor in that month in the target market, then the carriage fee amount will be equal to the rate of carriage fee per channel per subscriber per month, as agreed under the interconnection agreement, multiplied by the average subscriber base of the distributor in that month in the target market.

2. If the number of average active subscribers in a month for a channel in the target market is greater than or equal to five percent but less than ten percent of the average subscriber base of the distributor in that month in the target market, then the carriage fee amount will be equal to the rate of carriage fee per channel per subscriber per month, as agreed under the interconnection agreement, multiplied by 0.75 times of the average subscriber base of the distributor in that month in the target market.

3 If the number of average active subscribers in a month for a channel in the target market is greater than or equal to ten percent but less than fifteen percent of the average subscriber base of the distributor in that month in the target market, then the carriage fee amount will be equal to the rate of carriage fee per channel per subscriber per month, as agreed under the interconnection agreement, multiplied by 0.5 times of the average subscriber base of the distributor in that month in the target market.

4 If the number of average active fawadkhanin a month for a channel in the target market is greater than or equal to fifteen percent but less than twenty percent of the average subscriber base of the distributor in that month in the target market, then the carriage fee amount will be equal to the rate of carriage fee per channel per subscriber per month, as agreed under the interconnection agreement, multiplied by 0.25 times of the average subscriber base of the distributor in that month in the target market.

5 If the number of average active subscribers in a month for a channel in the target market is greater than or equal to twenty percent of the average subscriber base of the distributor in that month in the target market, then the carriage fee amount will be equal to ‘Nil’.

But TRAI said the average subscriber base of the distributor in a month will be calculated in a manner as prescribed in schedule VII of the regulations.

The target market refers to the relevant geographical areas, as specified in the interconnection agreement for carrying the channel.

ALSO READ:

TRAI on carriage fee, other issues in draft interconnect guidelines

October 14, 2016
Carriage fee in interconnect draft aimed at reducing litigation

NEW DELHI: The draft of the Interconnect regulations issued by the Telecom Regulatory Authority of India has given a formula for calculation of the carriage fee.

The carriage fee for each month or part thereof during the term of the interconnection agreement shall be calculated as given below:-

1. If the number of average active subscribers in a month for a channel in the target market is less than five percent of the average subscriber base of the distributor in that month in the target market, then the carriage fee amount will be equal to the rate of carriage fee per channel per subscriber per month, as agreed under the interconnection agreement, multiplied by the average subscriber base of the distributor in that month in the target market.

2. If the number of average active subscribers in a month for a channel in the target market is greater than or equal to five percent but less than ten percent of the average subscriber base of the distributor in that month in the target market, then the carriage fee amount will be equal to the rate of carriage fee per channel per subscriber per month, as agreed under the interconnection agreement, multiplied by 0.75 times of the average subscriber base of the distributor in that month in the target market.

3 If the number of average active subscribers in a month for a channel in the target market is greater than or equal to ten percent but less than fifteen percent of the average subscriber base of the distributor in that month in the target market, then the carriage fee amount will be equal to the rate of carriage fee per channel per subscriber per month, as agreed under the interconnection agreement, multiplied by 0.5 times of the average subscriber base of the distributor in that month in the target market.

4 If the number of average active fawadkhanin a month for a channel in the target market is greater than or equal to fifteen percent but less than twenty percent of the average subscriber base of the distributor in that month in the target market, then the carriage fee amount will be equal to the rate of carriage fee per channel per subscriber per month, as agreed under the interconnection agreement, multiplied by 0.25 times of the average subscriber base of the distributor in that month in the target market.

5 If the number of average active subscribers in a month for a channel in the target market is greater than or equal to twenty percent of the average subscriber base of the distributor in that month in the target market, then the carriage fee amount will be equal to ‘Nil’.

But TRAI said the average subscriber base of the distributor in a month will be calculated in a manner as prescribed in schedule VII of the regulations.

The target market refers to the relevant geographical areas, as specified in the interconnection agreement for carrying the channel.

ALSO READ:

TRAI on carriage fee, other issues in draft interconnect guidelines

October 14, 2016
“India is not yet mature for RIO deals”: Sanjev Hiremath

The current scenario in India is not very viable to allow for reference interconnect offer (RIO) to take off. No broadcaster would want to be on a RIO agreement because the moment you are on RIO, your distribution is affected. Broadcasters want their channels to be carried by all operators and also in good packs for maximum reach.

Subscription too would be lower at least initially. The RIO rate X subscribers on CPS basis will mostly likely be lower than the existing negotiated price for that channel.

India is not yet an addressable pay TV subscription market and RIO deals will not work anytime soon; neither for the broadcaster nor for the DPO. The addressable billing system, consumer communication and B to C marketing needs to kick-in.

Currently, broadcasters want reach and DPO wants carriage or at the least it does not want to pay for the channel and keep its content cost down. There is competition among DPOs too and cost of content is critical to all. RIO is a regulatory mandate in the absence of a deal and a good basis for negotiations. Money saved on carriage on RIO (as there is no carriage) can be used for discounts to structure deals.

In the immediate future, some channels will get impacted due to poor uptake or because of it being a niche or premium channel. Some of these channels will likely go on RIO especially stand alone ones. As and when billing for content gets established we move to a more mature market where broadcasters will get decent subscription revenues, niche channels will be able to survive and premium channels will make more money being a-la-carte on a CPS deal.

We are in a transition phase of moving to the real objective of DAS, pay as per channels viewed/subscribed – in short, ADDRESSABILITY!

(These are purely personal views of consultant Sanjev Hiremath and indiantelevision.com does not necessarily subscribe to these views.)

November 8, 2014
“DoT should regulate carriage and I&B can look at content”: Rahul Khullar

NEW DELHI: The Telecom Regulatory Authority of India (TRAI) chairman Rahul Khullar has once again spoken loud and clear. The 62-year-old Khullar has proposed that while the Department of Telecom should exclusively focus its attention on carriage and carriage related issues while the Information and Broadcasting Ministry (I&B), considering its history, should be only regulating content.

“And I think that is the way we need to go,” he said while addressing the gathering at the recently concluded CII Big Summit 2014.

He also came down heavily on the politicians and political parties. He said, “The Supreme Court through its ruling has clearly stated that airwaves are not the monopoly of the state.”

So, while Prasar Bharati must exist and it must be independent; politicians, governments, state governments and their organs have “absolutely no business whatsoever to be in broadcasting space,” he announced and suggested that the government must announce this as an integral part of the National Media Policy.

Khullar also gave his perspective on the other components of the National Media Policy. “Firstly, there must be a clear articulation that we want a free media, unhampered and unrestricted by the government in any way possible,” he said while also suggesting that the media itself must be subject to safeguards. “It could come from other forms of independent regulators. You cannot have an institution which has rights but no duties,” he added.

Secondly, there must be commitment in National Media Policy to uphold plurality of views and opinion. “And this must be a commitment,” he said.

Thirdly, time has come that we start talking about infrastructure. “If this National Media Policy is actually going to work, are we or are we not going to be in a digitised world? We cannot be flipping and flopping the dates as we send out wrong signals to the rest of the world about your credible commitment towards any policy,” he stated.

Khullar also pointed out the issues with spectrum availability. “It is a nightmare to deal with ISRO. The organisation neither gives you a transponder nor does it allow you to get a transponder of your own,” he informed.

September 22, 2014
Govt sending wrong signals to foreign investors by delaying digitisation: Rahul Khullar

MUMBAI: Recently, a letter written by Telecom Regulatory Authority of India (TRAI) chairman Rahul Khullar pointed out that the government was committing a mistake by extending the deadline for digitisation. Khullar has many more points to present on the regulator and the industry.

In a conversation with Bloomberg, he said that his views on digitisation were very clear. “It is a very bad decision to defer it. It is bad for digital India, broadband delivery and not in public interest,” he said.

While the government says that its main aim is to push indigenous production of seven crore set top boxes (STBs) in two years, Khullar feels that this is a ‘pipe dream.’

Khullar said that last year several investors met him and conveyed that it was a miracle that they managed to get two crore boxes digitised. They also asked that by when will digitisation be completed because they are desperately interested in investments in cable. “By delaying digitisation, you are sending a signal to foreign investors that India isn’t ready for investment yet. This does great harm to public credibility,” he said.

Meanwhile, rumours are afloat that the government is mulling creation of a ‘super regulator’ that will oversee the communications sector. Khullar believes that it is necessary to keep content and carriage separate. “If your aim is to strengthen TRAI then you don’t need a super regulator, just empower the existing one. But if it is to regulate carriage and content, this is an experiment that hasn’t succeeded in the world,” he said.

According to him, issues concerning content immediately ‘stir up a hornet’s nest’ that usually involves freedom of speech. “My own sense would be to keep carriage and content separate and ensure that the content regulator has nothing to do with the government. Then you have some sort of fighting chance of regulatory survival,” he said.

Broadband is a growing medium of revenue that is catching the attention of all in media space. The TRAI is due to come out with a paper on ‘policy issues relating to broadband’ in the next 10 days. “Broadband and convergence is still five to 10 years away. If we are to deliver broadband we need to know how to do it in the cheapest way, who should be involved, what to be done in terms of application and software development,” he highlighted. It will focus on building infrastructure and delivering content.

September 15, 2014
IPTV: I&B mandates carriage of 24 DD channels

NEW DELHI: Superseding its earlier orders in this connection, the Information and Broadcasting Ministry has updated its list of channels to be compulsorily carried on the Internet Protocol Television (IPTV).

The new order lists a total of 24 channels, which includes 21 Doordarshan channels apart from Gyan Darshan, Lok Sabha TV and Rajya Sabha TV.

The DD channels in the list are National, News, Bharati, Urdu, Sports, DD India, DD Kashir, DD Punjabi, DD Girnar, DD Sahyadiri, DD Saptagiri, DD Malayalam, DD Podhigal, DD Candana, DD Bangla, DD North East, DD Bihar, DD Uttar Pradesh, DD Rajasthan, DD Madhya Pradesh and DD Oriya.

The memorandum says it shall be obligatory for every IPTV Service Provider to provide these channels to the subscribers, irrespective of any bouquet(s) or a-la-carte channel(s) being subscribed by them. The IPTV Service Provider shall also place the above channels in the respective genre and shall display them in full television screen.

September 17, 2013

Cable TV carriage fees head south

Carriage fees have been a bane of the Indian television industry. Most broadcasters have been groaning and moaning how they have been choking up their capital, preventing them from investing in content, especially news channels.

Now throwing some light on the trend in carriage fees is five year old television media and distribution audit company Chrome Data Analytics & Media which has just released its Chrome Dii R3 (Distribution Investments Index – Round 3).

Chrome Dii,says the company, has been worked out while tracking deals done by broadcasters over the past year, with information gathered from across various sources including broadcasters as well as distribution platforms. After eliminating high variance deals, an average of six solo deals per cable network were studied for their investments for S band and UHF.

Jeffrey Crasto…

“For the digital scenario, Chrome Dii indicates a benchmark carriage to be available on the basic tier that is channels under BST (mandated FTA channels) along with the first tier of pay channels,” says Chrome Data executive director Jeffrey Crasto. “The study is inclusive of both new launches/new deals done in the last one year and existing deals expiring in April/May 2013.”

Adds Chrome Data founder & CEO Pankaj Krishna: “Digitisation was expected to be a harbinger of correction leading to nullification of carriage fees. As per TRAI, they had anticipated the Chrome Dii to come down to Rs 1, however though there has been a significant drop; it has not come down to Rs 1.As compared to R2, Dii has come down from Rs 20 to Rs 11.6. “

.. & Pankaj Krishna have attempted to demystify the burden broadcasters have to bear

In its third round, the Dii has revealed that north India has emerged as the costliest region with a whopping 16.7 crore in carriage fees for 100 per cent availability across Basic + S band for new channel launches and 13.3 crorefor renewals of existing deals whereas central India is the lowest with 3.11 crore and 2.73 crore for Basic + S band for new launches and renewing existing deals respectively.

While a different image is revealed if the Dii (cost per contact for the television channels) is studied, Chrome Dii R3 data shows the cost (renewals, S-band) per contact (household) is the highest in west India with an average of 17.6 followed by Central at 14.4. The national average for renewals stands at 11.6.

Out of a total universe of 47 million households in Class I India, 42 million are C&S Homes. Chrome Dii study tracks 31 million homes, 2 million remain uncovered and balance 9 million are DTH!

Source: Chrome Data Analytics & Media

C&S Households	89%	DTH	74%
Non TV Households	11%	Chrome Dii	21%
		Balance	5%

Chrome Data says that its Dii R3 was pre-subscribed by eight leading TV networks. And it is an addition to the other services that it offers (covering1800+ cities and towns) Chrome Track 2.0, Chrome DPi, Chrome Dii & Chrome SES, Chrome AV, Chrome LC1, Chrome NE and Chrome Language Feed.Some 132 channels subscribe to its various services.

Some interesting facts according to Chrome Dii R3 –

Carriage Fee Cost
	Existing		New Launch
REGION	Basic + S BAND	Basic + UHF	Basic + S BAND	Basic + UHF
CENTRAL	273,75,000	194,70,000	311,95,000	235,30,000
EAST	376,65,000	281,25,000	404,65,000	340,00,000
NORTH	1330,33,300	1118,71,800	1673,03,300	1343,67,800
SOUTH	549,50,000	466,67,000	625,65,500	527,32,500
WEST	1099,80,000	1014,80,000	1320,00,000	1195,00,000
Grand Total	3630,03,300	3076,13,800	4335,28,800	3641,30,300

* To cite an example as per the above data, comparing how much a Hindi News channel would spend for 75 per cent HSM availability as per Dii R3 as compared to Dii R2 – it would pay 75% of (Rs 36.30 croe minus Rs 5.49 crore for the south) = Rs. 23.1 crore as per Dii R3, whereas it would have paid Rs 38.2 crore as per Dii R2 – a saving of over 39 per cent! But has the overall pie reduced, not really! As there has been an increase in network bandwidth, hence the number of takers has increased.

North emerged as the costliest region with Rs 16.7 crore for 100 per cent availability across Basic + S Band and Rs 13.4 crore for 100 per cent availability across Basic + UHF for New Launches. Renewals of existing deals for Rs 13.3 crore for Basic + S Band and Rs 11.2 crore for Basic + UHF.

The study also provides a benchmark for carriage fee efficiency with respect to the investment indices that is Chrome Dii that is cost per contact (see tables below). Chrome reveals that the Dii (renewals, S-band, household) is the highest in West India with an average of Rs 17.6 followed by the Central at Rs 14.4. The national average for renewals stands at Rs 11.6.

Carriage Fee Cost per contact for existing channels in Rs
Existing-Basic+S Band
West	17.6
Central	14.4
North	14.1
East	7.1
South	6.6

Source: Chrome Data Analytics & Media

* In terms of highest Chrome Dii, West was followed by North, Central, East and South.

* The gap between Dii for Existing and New Launches has reduced over the years owing to digitization and increase in bandwidth of the networks.

Carriage Fee Cost per contact for new channels being launched in Rs
New Launches – Basic+S Band
West	21.1
Central	17.7
North	16.4
East	7.6
South	7.5

Source: Chrome Data Analytics & Media

* Further, the gap between Dii for S Band and UHF has also reduced due to digitization

* Chrome Dii for a New Launch in Central and East India has halved.

July 11, 2013