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Tag: tariff order

  • TRAI’s new tariff order has made ecosystem transparent: RS Sharma

    TRAI’s new tariff order has made ecosystem transparent: RS Sharma

    MUMBAI: The new tariff order has been rolled out aiming transparency in the cable and broadcasting sector of India. Telecom Regulatory Authority of India (TRAI) chairman RS Sharma reiterated that the new regulatory framework has brought transparency in the ecosystem along with non-discrimination and fair play. Sharma also asserted that it has reduced the bills of the average TV watcher.

    "The implementation of the new broadcast tariff regime is working out very well. The monthly bills of thousands of consumers have also been reduced. The consumer's bill is a function of how much he watches, if he or she watches hundreds of channels obviously the bills will go up. If someone watches 25 channels, the bill will come down to one-third," Sharma told as quoted by IANS.

    "The objective of the regulations is to essentially bring out a regime of transparency and allow the customers to choose channels which they want to watch, and then allow the market forces which were not in play earlier," he added.

    Earlier the market was only focused on distributors and broadcasters but consumers were not actively participating.

    He also added that the implementation of the new tariff regime has removed the difference between the small operator and a large operator, as they both get the channels at the same rate from the broadcasters. Moreover, he asserted that the basic objective of the new regime to create a buffet of channels where everyone is charged the same rather than reducing or increasing the bills.

    Sharma’s comment comes at a time when several reports, as well as surveys, have indicated that there has been a hike in the monthly bill under the new price regime. Due to the change in pricing, many experts predicted that consumers would shift to OTT platforms eventually. To decrease the churn rate, some of the DTH players have removed network capacity fee for long duration packs.

    Earlier, the regulatory body in February extended the deadline to pick new channels under the new regime till 31 March as well as gave a directive of Best Fit Plans. The subscribers that don’t opt for new channels would be moved to ‘Best Fit Plans’, which would be developed as per usage pattern, language and channel popularity, the sector regulator said in its statement.

  • TRAI tariff order’s impact on OTT content consumption

    TRAI tariff order’s impact on OTT content consumption

    MUMBAI: Amid debates over the impact of TRAI’s new tariff order on the Indian pay-TV ecosystem, over-the-top (OTT) platforms have emerged as probable beneficiaries. Several reports have indicated that streaming services stand to gain from the change in cable TV pricing. As digital continues to steadily emerge as an alternate content consumption avenue, the new tariff regime could stimulate the adoption rate of OTT platforms in the country. While OTT players seem optimistic about the positive impact of the new regulatory framework, there are those who believe there’s no direct correlation between the two.

    FICCI-EY 2019 report predicts that OTT platforms are certain to benefit post the tariff order implementation due to an increased parity between television and OTT consumption – both in terms of content choice and costs. The report also mentions that trends could also be determined by the channel prices at which the market settles, which could take up to six to nine months.

    This is not the only testimony in favour of OTTs gaining, as a report from Crisil too made similar observations. It said that OTT platforms could emerge as the big gainers amidst all these changes because many viewers could shift due to the rising subscription bills. In addition to that, it also mentioned that low data tariffs will also encourage viewership on OTT platforms.

    Velocity MR, another prominent market research and analysis company, carried out a survey of 2010 respondents across Indian cities including Delhi, Kolkata, Mumbai, Hyderabad, Bengaluru, Chennai, Ahmedabad, and Pune. The report states that more than 80 per cent of subscribers will either opt for lesser channels under new price regime or switch to OTT platforms.

    The CEO of India’s newest OTT platform MX Player, Karan Bedi, is of the view that the new pricing regime for broadcast channels is sure to add to the content consumption on OTT platforms especially for those audiences who no longer want to be restricted to a single TV screen. According to him, good content combined with the availability of better payment pipes and varied subscription models that come with OTT offerings, are the main drivers of entertainment today.

    "It may help because cable ARPU moves up post the tariff order and I really doubt if the consumer will stand more on TV in this kind of space where there’s so much variety on digital. So definitely you will see some kind of spend getting allocated from TV to digital,” remarked Elara Capital vice president Karan Taurani.

    The CEO of a top production house, which makes shows for both TV and OTT, said the new tariff order will definitely help OTT platforms to attract consumers. According to him, consumers that find it hard to access their preferred TV channels in the midst of this radical change are likely to shift to digital platforms.

    “Viewers are aligning their cable TV packs as channels may have blacked out, resulting in higher than usual numbers for streaming daily TV soaps on digital platforms. A significant traffic is driven by OTT due to the convenience it offers to the users. In spite of rapid growth in digital consumption, TV has its own audiences and will continue to coexist with OTT in the long run as it remains to have its dominance in India due to several factors,” ZEE5 India business head Manish Aggarwal said.

    PricewaterhouseCoopers (PwC) partner and leader, media and entertainment Frank D’Souza does not find a strong correlation between the tariff order implementation and OTT consumption uptake. However, D’Souza is of the opinion that a lot will depend on the price points broadcasters opt for. Moreover, the other thing which needs to be considered is the nature of content that OTT platforms are trying to build. He also mentioned that one is really not an option over the other as there is significant programming that is being released exclusively on OTT.

    “One is really a supplement for the other. So, we are not going to have a situation where someone is going to cord cut cable and get on to OTT. I don’t think there is a direct correlation between one and the other because the fact is that they operate in a different ecosystem. If the overall cable pricing gets expensive for a consumer he may try to kind of curtail it or he may choose only what he wants to see. That doesn't imply a natural migration to OTT,” he added.

    "TV and OTT services cater to a distinct set of audience, OTT services have an edge when it comes to meeting the ever growing consumer demand for fresh and engaging content, available at the end users finger tip, on-demand and on the move. The diversity of content and consumer choice is unmatched when compared to traditional broadcast media. OTT serves as personal viewing experience and is an additional layer for viewers to choose from wide array of content. At Eros Now we support consumer choice and work towards creating engaging and high quality content serving multi user needs,”  Eros Digital CEO Rishika Lulla Singh commented. 

    During the launch of Voot’s original short films label 'Shortcuts' in February, Viacom18 Digital Ventures marketing and partnerships head Akash Banerji had said that one would have to wait and watch how consumers eventually respond to the tariff order, and whether it finally ends up changing their deep habit of having access to 300 or 400 odd channels. While watching and having access to different channels is a habit developed over the years, Banerji felt it would be naive to start thinking and predicting that it would change instantly, with OTT platforms making rapid gains.

    “The only thing that we need to be clear of and that we are preparing for if this change happens, we should be ready to give an equally good experience to a lot of new consumer acquisition that will happen on OTT. As a network, our ambition, of course, will be to ensure that the watch time and the consumer size and the scale do not go down at a network level and only keeps growing up,” he had said.

    Whether new tariff order helps OTTs gain or not, the massive growth of the digital ecosystem in next few years is undebatable. The FICCI-EY report too estimates that digital subscription revenue is bound to grow at a CAGR of 55 per cent to touch Rs 5290 crore by 2021 up from Rs 1420 crore in 2018.

    The Indian broadcast sector is steadily coming to terms with the radical changes the TRAI tariff order has resulted in. With most key indicators beginning to stabilize, the impact of the new framework in terms of content consumption trends on OTT platforms and digital media needs to be closely monitored, with patterns and trends beginning to emerge.

  • TRAI tariff order’s impact on DD Free Dish’s growth

    TRAI tariff order’s impact on DD Free Dish’s growth

    MUMBAI: Prasar Bharati run direct-to-home (DTH) platform DD FreeDish’s success is evident from the estimated number of subscribers it boasts of. The free-to-air (FTA) DTH service, experts believe, commands close to 30 million subscribers, which could shoot up post TRAI tariff order’s implementation, the 2019 FICCI-EY report points out.

    According to the report, DD FreeDish has the potential to breach the 50 million subscriber mark if broadcasters continue to provide pay content on the platform.

    Another interesting point worth mentioning here is that the report suggests lower end consumers will increasingly shift to the free platform or even use it for their second television connection as a result of the new tariff regime.

    Last year at the Video and Broadband Summit, Doordarshan director general Supriya Sahu stated that FreeDish is not only used by a marginal section of the society but is also evolving as an alternative option for consumers. An older report of consulting firm EY predicted that the number of DD FreeDish subscribers is bound to cross 40 million by 2020.

    While the experts Indiantelevision.com spoke to were optimistic about the potential for robust growth, they seemed sceptical about the scale.

    Elara Capital vice president Karan Taurani did not agree with 2019 FICCI-EY report's observation about FreeDish, especially the figure of 50 million. Taurani rejected the possibility of a second home connectivity, adding that mobile is going to be the second screen for consumers. He said content consumption increment is happening on digital platforms.

    PricewaterhouseCoopers (PwC) partner and leader, media and entertainment Frank D’Souza, however, believes there is some merit to the argument.

    “Now the question is how many households who can get multiple connections will choose OTT rather than adding one more TV connection- that is little debatable. But the first argument has merit –lower-end consumers may shift to DD Free Dish. But the question is, will lower-end consumers be able to have multiple connections due to lack of physical space availability?” he asked.

    Travelxp CEO Prashant Chothani said the growth of FreeDish has so far been propelled by free content only. Now, however, major broadcasters have pulled off their content from the platform, he highlighted.

    The report also says that if large broadcasters continue to keep their content off the platform, television advertising revenues would be impacted and FreeDish’s future will be determined by the number of new channels that sign up on the platform.

    “FreeDish generated an estimated Rs 20 billion of advertising revenues. In February 2019, large broadcasters removed their channels from this medium and this could impact our ad revenue forecast by Rs 10-20 billion in 2019,” the report adds.

    Earlier this year, Prasar Bharati board gave a green signal to e-auctioning of DTH slots on DD FreeDish which was arbitrarily called off in October 2017. The first e-auction after recommencement witnessed intense competition. Under the revised guidelines, a total of 40 MPEG2 slots were successfully sold while the estimated revenue from the sold slots is Rs. 395 crore.

    The FICCI-EY report also adds that regional, news and niche channels, especially those impacted negatively by the TRAI tariff order, are bound to build their audience through FreeDish (subject to auction base prices).

    Industry experts, however, see things different in case of niche channels.

    “I don’t know how much they will try and do that because the market for niche channels is different and the people who are going to access DD Free Dish – the consumer is different. It may not fit the target segment of such channels,” D’Souza argued.

    According to Chothani, niche channels don’t see DD FreeDish as a viable option and are not going to jump on its bandwagon.

    In addition to that, he also pointed out that niche channels won’t be negatively impacted by the new tariff order. According to the 4k pioneer, niche channels will benefit from the new regime because consumers won’t shy away from paying for good content.

    “One of the fundamental premises of new tariff order is also to bring transparency in the system. Consumers’ habits build over time and also change. If they want to see the content which they were seeing earlier and now they are not getting because of NTO, in due course of time, they may subscribe. If the content is strong enough they will subscribe,” he opined.

    Taurani said niche channels opting for DD FreeDish remains a possibility mired in a couple of constraints. Apart from limited slots, what could also deter niche channels from staying off FreeDish is the high carriage fee.

  • Sun Direct introduces long duration regional packs

    Sun Direct introduces long duration regional packs

    MUMBAI: The popular DTH operator in South India, Sun Direct, has introduced long duration regional packs. According to reports, the newly introduced DPO packs come with a validity of up to six months covering languages Telugu, Tamil, Kannada, Malayalam, Marathi, Bengali and Odia.

    A three month long duration pack is also available with the six month variant. Subscribers can also avail a discount of about 7 to 10 per cent if they want to opt for these packs. Earlier, another leading DTH player Tata Sky launched Annual Flexi Pack with a recharge credit of one month.

    Before the new TRAI tariff regime came into effect, every DTH operator had long duration packs which had good demand among consumers. With the changes in pricing, the DTH players are now rolling out new packs to prevent churn rate.

  • Airtel Digital TV removes network capacity fee

    Airtel Digital TV removes network capacity fee

    MUMBAI: After Telecom Regulatory Authority of India’s (TRAI) tariff order has come into effect, consumers across the country have been complaining about a hike in cable bill. To keep them satisfied, DTH operators are waving off Network Capacity Fee (NCF). Now, Airtel Digital TV has joined the league of operators who have removed the NCF on free-to-air (FTA) channels following Tata Sky, Dish TV and Sun Direct.

    Airtel Digital TV is waiving off NCF for its long term plans only. Subscribers under three months plan, six months plan, 12 months plan will be able to avail this facility. According to media reports, the modified long term plans are now available in selected regions and are expected to be expanded into other regions within a few weeks.

    As per the latest framework, customers need to pay Rs 130 to get the first 100 FTA channels. An additional network fee of Rs 20 per month is also being charged for every block of 25 paid channels.

    Last month, TRAI extended the deadline for DTH and cable TV subscribers to select their channels till 31 March under the new tariff regime. The regulatory body added that the subscribers’ old plan would continue till the consumer makes the choice. TRAI also said that the subscribers who don’t exercise any choice would be migrated to ‘Best Fit Plans’.

  • Uday Shankar, citing TRAI tariff order, suggests govt should unshackle instruments of monetisation

    Uday Shankar, citing TRAI tariff order, suggests govt should unshackle instruments of monetisation

    MUMBAI: Uday Shankar believes one of the most ‘powerful’ means of fuelling the next decade of growth for India’s media and entertainment industry is for the government to ‘unshackle the instruments of monetisation’. Driving home his point, the veteran executive cited the Telecom Regulatory Authority of India’s (TRAI) as an example.

    “Distribution regulation of television content, where what you can charge from the consumer regardless of how much you invest in the content, is determined by the regulator and not the market,” Shankar said on the opening day of FICCI FRAMES 2019, where he moderated a session titled ‘Global Goes Indian’ featuring MIB secretary Amit Khare and Prime Minister Narendra Modi’s Economic Advisory Council chairman Bibek Debroy as panellists.

    Shankar wondered whether there was a need for India to revise its ecosystem in order to compete in the global content market place.

    “When a Hollywood film is made, or when Netflix or Amazon produce a series, they are able to monetise it across the world and hence their ability to invest in that content is a great deal more. In India, especially for TV, because of restrictions on how and how much can you monetise, there is a cap on investment. There are regulations on the affiliate monetisation front. So, your ability to monetise is limited,” he argued.

    Shankar channelled his inner newsman as he highlighted some of the most pressing issues facing India’s media and entertainment industry. The recently appointed Disney APAC boss referred to a series of stumbling blocks across film, TV and digital content creation that could delay the sector from realising its true and full potential.

    The 56-year-old focused on three key areas that needed addressing for the Indian M&E to grow at a faster pace. The FICCI vice president drew the attention of the panellists and the audience to issues plaguing content creation, monetisation and the need for government policies and regulations to be consistent.

    Shankar rued the fact that India wasn’t adding more theatres in tune with the times. He pointed out that the increase in number of screens was a result of single screen theatres being converted to multiplexes.

    “New theatres are not coming and while more films are being released in Hindi and regional languages, it becomes a challenge for them to get exhibited because there are not enough screens. While the big budget films are still accepted by theatres, the smaller and regional films are struggling. This problem looks like it’s going to get more and more complex,” he said.

    Shankar then shifted his focus to the lack of adequate infrastructure, adding how this was preventing creators from scaling up their focus on local and city-specific content across the country. To further build on his perspective, Shankar offered the example of Mumbai’s film city.

    “We had one film city which used to cater to the needs of the film industry and a few TV channels. Now, we still have the same film city which has to cater to the needs of the much diversified industry,” he stated.

    Shankar asked whether policy development by the government, given that M&E is a major employer, would be a potential problem solver. However, he made it clear that the industry isn’t seeking any special favours from the government.

    “The entire content for whole Hindi heartland from Bihar all the way to MP, Rajasthan, Gujarat and Haryana is created out of Mumbai because it is the only city where basic infrastructure still exists. A decade ago, there were initiatives to launch Bhojpuri channels designed to cater only to the population of Bihar and some parts of UP. But all those channels turned out to be unviable because there was no facility to create content locally and all of them had to come and rent expensive facilities in Mumbai and create content here. There are no facilities available outside Mumbai. Is this a subject needs that needs to be addressed via policy intervention?” he asked the panel.

    Shankar then drew a parallel to how a complex process at every level had been a hindrance to investment in theatre infrastructure.

    “For instance, the reason malls are coming up everywhere and no theatre is being made is simply because the entire policy around building a new theatre, in terms of all requirements, is too complicated,” he said.

    Shankar made another critical point as he highlighted the need for government policies to be consistent.

    “There has to be certainty of regulation. You should know what is expected of you and what you need to deliver. There should be no surprises, because surprises create a shock in the system and everyone takes time to recover from that,” he stated.

    Earlier in the day, during his opening remarks, Shankar described India as one of the major media markets in the world. According to him, Indian M&E is at an inflexion point.

    “We are already seeing the innovations that are taking place in this country in the domain of sports or in digital, where Indian creativity is being talked about globally and attracting the interest of one and all. However, we need to make sure that our policies are aligned to accelerate creativity and growth,” he said.

  • TRAI tariff order’s impact on advertising expenditure on regional channels

    TRAI tariff order’s impact on advertising expenditure on regional channels

    MUMBAI: While TV still remains the primary avenue for major brands to break their bank on advertising expenditure (adex), digital is slowly but surely capturing a bigger slice of that pie. According to the FICCI KPMG 2018 report, adex on Hindi GECs saw a decline of nine per cent in FY18 while regional channels witnessed an increase of 5.4 per cent. The new tariff order is likely to ensure that trend continues in FY19 as well, industry experts feel.

    Carat India SVP Mayank Bhatnagar said that new tariff regime will not impact the adex on an immediate basis but depending on the viewership patterns, advertising deals or strategy would be recalibrated by brand managers. Likewise, Enterr10 Fakt Marathi MD Shirish Pattanshetty was of the opinion that overall advertising spends are likely to grow this year with general elections, IPL and the cricket World Cup. He stated that the regional language market is likely to grow in double digits.

    As per industry reports, ad spends grew 17-18 per cent on FTA channels in 2018 as compared to 10 per cent in 2017, the lowest in five years. TV is expected to be the lead medium as far as reach is concerned for the next three years, with the FMCG category being the highest contributor when it comes to TV ad spends.

    Dishum Broadcasting COO Partha Dey believes that the consumption pattern of genres won’t change but the new regulatory framework could compel some viewers to opt for free or cheaper channels.

    Stratagem Media founder director Sundeep Nagpal, however, contradicted Dey by stating that this trend had nothing to do with the new tariff order. 

    “The new tariff order would, in a way, be less detrimental for regional channels than for national channels,” he explained. 

    HBC founder Harish Bijoor felt that the decline in the adex will be greater for regional channels post the implementation of the new tariff norms.

    Now that over the top (OTT) platforms have already entered the race, the industry predicts that both TV and OTT will work together in the long run. Ad spends on TV and digital stand at 45 per cent and 15 per cent respectively and the latter is expected to take bigger strides in the near future. Total ad pie for TV and OTT will rise from the current 60 per cent to 80 per cent in the next three to four years.

    The CEO of a major production house pointed out that ad spends on digital media have been growing upwards of 30 per cent in the last five years and that trend is set to continue.

    “Having said so, the traditional media including TV will also continue to grow making India the most distinct big market in the world,” he said.

    “I have been hearing the regional content conversation for the last eight years. There is every proof that the regional market is critical, fast-growing and is getting more and more localised.  The power of regional will only go up,” he highlighted. 

    According to him, this is not a new trend as it is opening up dramatically in the OTT space as well. 

    “Each language will gain maturity from the point of view of revenue catchment because along with creating value, you also need a strategy to capture value,” he added.

    With DPOs trying hard to migrate subscribers to the new system, TRAI has given customers time till 31 March 2019 to make their new channel selections. 

    Even the BARC ratings have not been released to the public till there is some stability in viewership. 

    While the industry remains divided on the impact of the tariff order on adex, a clearer picture will emerge once the dust settles.

  • FTA channel adoption shoots up post TRAI tariff order implementation; pay channels dip

    FTA channel adoption shoots up post TRAI tariff order implementation; pay channels dip

    MUMBAI: Five weeks into the new TRAI tariff regime, there seems to be some shift in viewership patterns and consumer choices. According to Chrome LIVE data, pay channels witnessed a drop of 24 per cent from week 4 to week 9 in 2019. On the other hand, FTA channels saw a spike from 21 per cent to 26 per cent in the same time span.

    Prior to the implementation of the new tariff order (NTO), DPOs and broadcasters were mostly operating on a fixed fee model. However, the new regime is showing a significant impact on the channel reach, channel share, ratings of non-driver channels and the overall revenue.

    Major fluctuations were seen across national channels over the last couple of weeks including Hindi GECs which saw a drop ranging between 0.5 to 10 per cent for pay channels and 0.1 to 5 per cent for FTA channels.

    Some passable changes enumerated in week 7 by way of reversal of the impact on connectivity of channels – exponential loss on pay had somewhat reduced owing to multiple operators putting on channels as per the old package after having switched them off. The same has also had an effect on FTA which had seen a spike.

    The second week of NTO extension continued seizing changes at PAN India level which earlier was a 3 per cent gain for pay and 5 per cent gain for FTA channels in Chrome DM’s week 7 data which in week 8 changed to 5 per cent and 4 per cent gain respectively.

    Some more interesting changes as the NTO appendage concluded its third week on ground with pay channels registering a drop of 6 per cent owing to changes in channels’ connectivity across Free Dish and FTA gaining 2 per cent across the standard definition channels in Chrome DM week 9 data.

    The key to address these challenges for securing the correct revenue share amongst other things would entail consumer education, constant monitoring of consumer preferences and realignment of the bouquet packaging strategies taking into account consumer preferences.

    Under the new regime, consumers have the option of paying only for channels they want to watch and can drop other channels from their list and hence, the subscriber base will now solely depend on the communication between the DPOs and the end consumer, and in the event of any communication gap, the last mile consumer will not subscribe to the channels and these may result in significant erosion of subscriber base impacting the revenue of DPOs and the broadcasters.

  • TRAI tariff order’s impact on regional channels and ad rates

    TRAI tariff order’s impact on regional channels and ad rates

    MUMBAI: India’s regional broadcast sector has taken off in the last few years. With more investment pouring in, the quality of content and production has risen up a notch. While the regional language market has a lot going for it at the moment, the Telecom Regulatory Authority of India's (TRAI) new tariff order seems to have the potential to upset the apple cart. Industry experts believe that paid regional channels are likely to experience a dip in viewership compared to FTA channels with the implementation of the new framework.

    According to BARC India data, regional language viewership has witnessed a massive spike over the last two years. Bhojpuri saw a 134 per cent increase, followed by 125 per cent for Assamese, 89 per cent for Oriya, 81 per cent for Gujarati, 68 per cent for Marathi, 55 per cent for Bengali, 52 per cent for Kannada, 34 per cent for Punjabi, 23 per cent for Hindi, 18 per cent for Telugu and 17 per cent for Tamil. 

    Regional channels of late have been the bastions of growth not only in terms of viewership but also advertising revenue. Not only regional GECs, but regional movies, music and news have experienced growth in terms of ad volumes. However, niche and paid regional channels could be in for a bumpy ride going forward.

    Highlighting the impact of the new regime on these regional channels, Dishum Broadcasting COO Partha Dey said that if the carriage deals are in place with distribution platform operators (DPOs), viewership of regional FTA channels will not be affected. 

    “However, this may not hold true for long tail regional pay channels. Nevertheless, we may notice slight turbulence till the time TRAI guidelines are fully implemented,” he pointed out.

    Stratagem Media founder director Sundeep Nagpal voiced a similar view. Nagpal explained that the new tariff order is likely to adversely impact the penetration of regional channels in genres like music and movies as well as secondary GECs. However, the primary GECs or news channels that are not FTA may not be affected.

    Enterr10 Fakt Marathi MD Shirish Pattanshetty felt that the viewership in the regional cluster is likely to grow. He mentioned that multi system operators (MSOs) and local cable operators (LCOs) that are not educating the customers, and are trying to put together different packs by adding regional channels in it, which is against the new regime. 

    “If they are FTA and are included as part of the base pack, they are bound to grow so the essence of distribution and content will play a good game, but for the pay, they are bound to take a haircut. The customer should be given a choice of what he wants to pick and pay and then educate him on costing and give him options,” he stated.

    Meanwhile, Carat India SVP Mayank Bhatnagar said that the overall viewership and reach will get impacted but broadcasters will play it safe by having their most stable channels in the mix to minimise the risk. According to him, there is also merit to increase focus on digital to mitigate the risk.

    With the new regime, there will be a re-estimation of brand and content value, said HBC founder Harish Bijoor. According to him, consumers will contemplate the value of these channels. If two channels are regionally similar, they are likely to pick one.

    “So, a fair number of people have to take the decision about the entertainment repertoire as it need not include all these channels.” 

    The television industry in India has grown from Rs 58,800 crore in 2016-17 to Rs 66, 0007 crore in 2017-18 as per FICCI-EY Report 2018, thereby registering a growth of 12.24 per cent. The number of SD pay TV channels also saw a rise in the number from 147 in 2010 to 213 in 2018. 

    Dey and Pattanshetty believe that the reach of regional FTA channels is bound to grow subsequently leading to an increase in ad rates, with regional segment advertising rates likely to go up in all regional language markets.

    Nagpal, on the other hand, said that it wouldn’t be significant in the short run. However, it could lead to an increase of up to 25 per cent in some cases, if there’s a shakeup. 

    According to Bhatnagar, this will give an opportunity to the planners to rationalise the rates across channels.

    “Only those channels will be able to hold rates which add significant value and improve the effectiveness of the campaigns. Long tail channels will get impacted the most,” he highlighted.

    Hindi remains the preferred language of consumption for TV audiences in India, but growth is led by regional content. Rural India, at 99 million TV homes is 17 per cent higher than urban India but is only 52 per cent penetrated.

    When asked whether consumers from the rural areas would be willing to pay for the regional channels, Dey said that as per TRAI mandate of 100 FTA channels in base pack a rural or price-conscious consumer will first choose all FTA channels of the region and then go for top two or three regional pay channels and may forgo rest of regional pay channels, as FTA will suffice their consumption. 

    Similarly, Nagpal said, “Relatively speaking, rural penetration is likely to suffer more than the urban penetration, where the monthly subscription packages that will be developed by LCOs and MSOs, are likely to be even more attractive.” 

    Pattanshetty said that the rural audience might buy some of these channels but not all them. They will eliminate the ones that are not relevant to them. Furthermore, according to Bhatnagar, subscription rate will differ from region to region, given varied distribution and broadcast landscapes. Bijoor added that these rural homes are restricted as there is just one person in the whole family to decide as to which channel to watch and hence there will be a major impact on that front too.

    Stakeholders of the broadcast sector are hoping for some clear trends to emerge from the implementation of the new tariff order. While its no longer business as usual for most broadcasters, they will have to pay special focus to the developments in the regional language markets after the dust settles in the next few months.

  • Cable subscribers switching to DTH platforms amid new tariff order implementation

    Cable subscribers switching to DTH platforms amid new tariff order implementation

    KOLKATA: While the Telecom Regulatory Authority of India (TRAI) continues to reiterate that its new tariff order will benefit all stakeholders of the cable and broadcasting industry, implementation of the new norms has witnessed a mixed response on the ground. As the ecosystem adapts to this radical change, local cable operators (LCOs) in Kolkata have started bleeding as cable subscribers are migrating to DTH platforms.

    Many consumers in the city have complained that they are experiencing channel blackouts despite shifting to new packages ahead of the deadline. In addition to that, they also contended that the operators are forcing them to opt for packages and not providing any options of a-la-carte channels. As a result, several consumers have switched over to DTH platforms in order to avoid this hassle.

    One of the major local cable operators in south Kolkata said they have experienced 10-15 per cent churn rate post the new tariff order implementation. On the other hand, another operator in north Kolkata has claimed that his company experienced a 20-25 per cent churn rate. Both of them have opined that the churned out subscribers are not choosing other cable operator but DTH operators only.

    Both the local cable operators blamed MSOs for not having a proper system in place to make the migration smoother. According to them, the websites of MSOs are crashing due to the traffic spikes. In turn, this is hampering the process of new package selection, with the a-la-carte channel activation getting delayed. 

    They also pointed out that web portals of some national MSOs are malfunctioning for last two months. They added that subscribers, being unaware of the problems, are pinning the blame squarely on LCOs.

    Last week the West Bengal government held a meeting with some of the stakeholders of the Indian broadcast and cable industry to understand the tariff issue and challenges in its implementation.

    State government sources told Indiantelevision.com that the meeting, attended by a minister too, was called to explore what the stakeholders could do for local LCOs who have been having a trying time to convince and educate consumers, especially in rural areas of the state.

    It is learnt that those who attended the meeting included senior representatives from Star India, MSO Hathway and Zee group. One of the requests made by the state government, according to official sources, was whether companies like Star and Hathway could also fund educational TVCs relating to the TRAI tariff order in the Bengali language that could be aired by the LCOs on their networks to make consumers better understand the issues relating to  channel selection and their prices. Industry stakeholders, it is learnt, remained mostly non-committal on this particular matter of TVCs in Bengali.

    Maharashtra Cable Operators Foundation (MCOF) committee member Asif Sayed, an LCO based out in Mumbai, too voiced a similar opinion, saying a-la-carte channel activations are getting delayed as MSO web portals aren’t equipped to manage the load.

    According to him, the churn rate is actually 5-10 per cent and another 10-15 per cent may be switching off because of ongoing examinations. Hence, after one month, there would be clarity on the actual churn.

    Since the beginning of tariff order rollout, many LCOs across the country have expressed their reservations about the new regulations. The 80-20 revenue share between broadcasters and DPOs has been a bone of contention, as they maintain there should be revenue cap separately for LCOs.

    “NTO has come at a time industry had settled down after DAS. Obviously it's a major shift and hence causing confusion across the board. Negative propaganda does happen when any change takes place. For example when DAS was declared similar propaganda was there that MSOs are not equipped to provide channels, boxes, and that consumers are migrating to DTH. Some people strategically float these propaganda. DPOs offer packages that satisfy most consumers. If a particular MSO fails to implement that there could be migration to other DPOs which can be to DTH or to other MSOs,” KCCL CEO Shaji Mathews, a veteran in the industry, commented.

    Mathews also added that the major MSOs are equipped to provide high-quality service to their consumers. 

    According to him, MSOs are in a better position to implement the order as cable operators are doing channel activations on ground. He added that in any case, there will be some amount of consumers who will keep jumping on both sides. He does not hold the view that there is any massive migration on either side, neither to cable nor to DTH.

    “Whatever migration is taking place is driven by non-compliance of some stakeholders. While the SC has commented on the need to regulate bouquet rates in relation to a-la-carte rates, the broadcasters have taken liberty to overstep the basic objective of NTO and declare disproportionate rates. With the most important part of the NTO thrown to the wind it's as good as no NTO and is the fundamental cause of confusion. Secondly, I have come across a DTH operator in blatant violation of basic DAS itself and transmitting unencrypted channels including pay channels,” he further added.

    Earlier TRAI said that in case of MSOs and LCOs, the biggest problem was discriminatory treatment by the broadcasters. As a result, it was almost impossible for smaller MSOs to get the content at an appropriate price from the broadcasters because the agreements were not transparent.

    The new tariff order, however, was meant to change that and benefit both the MSOs and LCOs. While a part of cable industry continues to believe the same, a large number of LCOs, at least in Kolkata, are quite disappointed with what implementation of the new tariff order has resulted in.