MUMBAI: The payouts of smaller cable networks towards pay channels have been going up. And this is despite the price freeze on subscription rates imposed by the broadcast regulator says Essel Group additional vice chairman and head of SitiCable Jawahar Goel.
“As a multi system operator (MSO) model, the price freeze (ordered by the Telecom Regulatory Authority of India – Trai) has helped. But for smaller networks the payout has gone up,” Goel says.
Trai had frozen pay channel rates but had allowed broadcasters to ask for increase in subscriber declarations from cable operators.
“If I were to draw an analogy, the Trai regulation is like you can’t increase the rates of bananas in kilos but in dozens,” says Goel, taking a dig at the broadcast regulator.
There is a flaw in the tariff control system as there is no uniform price for consumers. This technically can be challenged in the court by subscribers, asserts Goel.
Broadcasters have also divided MSOs to increase their revenue growth from subscription. “In certain cities, they have done minimum guarantee deals with an MSO. In Hyderabad, for instance, Star and Sony have joined hands and given the distribution to Hathway,” says Goel. An attempt to have a similar kind of arrangement with RPG network in Kolkata was thwarted as the state government intervened, he avers.
In the cable TV distribution business, there is no fair play. “Here might is right. There is no ground rule,” says Goel.
But the head of Siticable is optimistic. “A distribution margin system will evolve across the three value chains – MSOs, broadcasters and last mile cable operators. This is bound to happen even in a non-CAS (conditional access system) situation.”
Is it necessary to lift the price freeze? “It has to come with some regulations. There has to be discipline in the broadcasting and distribution business,” says Goel.