ITV

Tag: TDSAT

  • Unbundling channel rates a danger to TV ecosystem?

    Unbundling channel rates a danger to TV ecosystem?

    MUMBAI: In the midst of the digitisation process in India, several issues continue to be left unanswered. One such being the matter of unbundling of channels for which the Telecom Regulatory Authority of India (TRAI) issued a consultation paper asking suggestions from stakeholders regarding the same but no decision was reached after that. There is however a rift between MSOs and aggregators on the issue with the MSOs favouring it and aggregators being against it.

    The real question is whether or not it will benefit everyone including the broadcasters, MSOs, aggregators and finally the consumer. 

    A report on the situation in the US by investment banking and asset management firm Needham and Co’s entertainment analyst and MD Laura Martin says, unbundling of cable TV rates could well be a recipe for disaster for all concerned. In the report, Martin has taken a look at the issue from the consumer’s perspective and its consequences for them and for the ecosystem. 

    Martin’s report reveals that US households pay about $720 per year for 180 channels out of which they watch just 18. Consumers would like to pay $30 per month to watch these 16-20 channels. As compared to this, in India, annual rates are a paltry $30-$60 per annum for anywhere between 120 channels to 200 plus channels. 

    Martin argues that if consumers wanted to have all 180 channels as a la carte, their annual spending would increase to $1260, i.e, 75 per cent higher than the current price. 

    Here’s how it goes: cable TV channels in the US generate $56 billion from advertising and $45 billion from subscribers, while pay TV distributors pocket $30 billion, if one goes by last year’s figures. She estimates that if there was unbundling about 124 channels out of these 180 would be wiped out as they would not be in a position to have an average of the 165,000 viewers which Martin estimates are needed to break even on each cable TV channel’s $280 million per annum investment. Her view is that niche channels would simply disappear.

    The decrease in channel choices, points out Martin, would also mean that approximately $80 to $113 billion would be lost in consumer value and the government would lose $20 billion in taxes. It will also put the US, which is already dealing with a high unemployment rate of 7.3 per cent in October 2013, at a risk of losing 1.4 million additional jobs.

    She also warns that if these 180 channels do not create content that is engaging young Americans in the 18-34 year age group, there might be no traditional linear television left in 10 years. Viewers are resorting to cord-cutting and migrating increasingly to online for their entertainment to services such as Hulu, Netflix, Big Frame, Defy Media, Fullscreen, Machinima, Maker Studios,etc. According to a statistics portal Statistica, 43 per cent of Americans between the ages of 18 and 34 preferred Netflix as compared to 46 per cent of paid subscribers who chose cable.

  • TRAI seeks industry comments on FM Phase III migration

    TRAI seeks industry comments on FM Phase III migration

    MUMBAI: The Telecom Regulatory Authority of India (TRAI) has released the consultation paper on the migration of FM radio broadcasters from Phase-II to Phase-III. As part of the consultative process, the stake holders have been requested to offer their comments and views by 17 December 2013.

    Accordingly, this Consultation Paper (CP) has been prepared to seek the comments/views of the stakeholders on the date of migration from Phase-II to Phase-III; duration of permission after migration from Phase-II to Phase-III; and the amount of migration fee to be charged from existing operators on their migration from Phase-II to Phase-III.

    It also states that in case of counter-comments it may be submitted by 24 December 2013. The Ministry of Information and Broadcasting (MIB) sent a reference dated 9 April 2013, to TRAI seeking recommendations. The clarifications sought by TRAI were provided by MIB by 22 November, 2013.

    The highlights of the Phase-III policy for FM Radio broadcast will be the validity of license is 15 years from the date of operationalisation of the Channel (10 years in Phase II); FDI limit have been raised to 26 percent in a private FM radio broadcasting company (from 20 per cent in Phase II); and it also allows the permission holder to carry the news bulletins of All India Radio in exactly the same format (unaltered) on such terms and conditions as may be mutually agreed with Prasar Bharati, no other news and current affairs programs will be permitted under the Policy. 

    The other salient features of the policy are
    – Permission for the channels shall be granted on the basis of Non-Refundable One Time Entry Fee (NOTEF).

    – NOTEF shall be arrived at through an ascending e-auction process, on the lines followed by DoT in the auction of 3G and BWA spectrum in the year 2010.

    – Reserve Price for new channels in existing FM Phase-II cities, the highest bid price received for that city in Phase-II (Click here for more details); and for new cities, the highest bid price received during FM Phase-II for that category of cities in that region.

    – In case the benchmark from Phase-II for a particular region is not available, the lowest of the highest bid received in other regions for that category of cities.

    – For new cities in border areas with a population less than one lakh, the reserve price shall be Rs 5 lakh.

     

    – Annual licence fee will be four per cent of gross revenue of its FM radio channel for the financial year or 2.5 per cent of NOTEF for the concerned city, whichever is higher. For the permission holders in the States of North East, J&K and island territories (i.e. Andaman and Nicobar islands and Lakshadweep) – at 2 per cent of gross revenue for each year or 1.25 per cent of NOTEF for the concerned city, whichever is higher, for an initial period of three years from the date from which the annual license fee becomes payable and the permission period of 15 years begins.

    -Each applicant will be allowed to own more than one channel but not more than 40 per cent of the total channels in a city subject to a minimum of three different operators in the city.

    -No entity will be permitted to hold more than 15 per cent of all channels allotted in the country excluding channels located in Jammu and Kashmir, North Eastern States and island territories.

    -Networking of channels will be permissible within a private FM broadcaster’s own network across the country subject to 20 per cent of the total broadcast in a day is in the local language of the city and promotes local content.

    – The permission holder is required to follow the Programme and Advertisement Code as followed by All India Radio as amended from time to time or any other applicable code, which the Central Government may prescribe from time to time.

    In this phase, about 839 additional channels in about 294 cities across the country are being offered for the auction.

    Click here for the full consultation paper

  • TRAI to host OHD on 10 December for new DTH licences

    TRAI to host OHD on 10 December for new DTH licences

    MUMBAI: The direct-to-home (DTH) players can now put their viewpoints on issues related to new DTH licences. The Telecom Regulatory Authority of India (TRAI) has called for an open house discussion (OHD) on 10 December at Ghalib Seminar Hall, Ghalib Institute Aiwan-e-Ghalib Marg, New Delhi for stakeholders to meet the regulator and present their viewpoints on the consultation paper and the supplementary consultation paper released earlier by TRAI.

    The regulator had earlier on 1 October issued a consultation paper on extension of DTH licences. The TRAI had later on 14 November also issued a supplementary consultation paper, which sort to get views of the industry stakeholders on the comprehensive review of the provisions in the existing DTH guidelines.

  • TDSAT-Ad cap: Amicus curiae No 2 takes over

    TDSAT-Ad cap: Amicus curiae No 2 takes over

    MUMBAI: The TRAI ad cap hearing has entered its final stages at the TDSAT even as the second amicus curiae Aman Ahluwalia came up spoke forth, following the completion of first amicus curiae Madhavi Divan’s arguments.

    Divan had opined that the Telecom Regulatory Authority of India (TRAI) has authority because duration of TV commercials is not content and quality of service is not a technical point. So the TRAI had the right to mandate any ad regulation under section 11 of the TRAI Act.

    Ahluwalia put forth the point that there wasn’t a necessity to get into the larger aspects as to whether TRAI has the right to deal with content or not because duration is not content. A decision can be made as to whether duration can be taken as content and if it is not then TRAI has the powers under section 11 of the TRAI act to deal with quality of services.

    Articles 19 and 14 of the Constitution will not come into the picture if it is held that duration is not content.

    He also said that he had personally done an average of ad timings on English channels for a week in September, after the 12 minute ad cap regulation came into effect. His finding was that broadcasters were doing an average of 17 to 19 minutes of TV commercials and it was not as grave as TRAI was making it out to be.

    The TDSAT bench questioned Ahluwalia that if there already was a provision in the Cable TV Networks (CTN) Act then what was the need to consider enforcement of regulating advertising under the TRAI Act. The bench added that it was difficult to understand that the regulation is the same as section 7 (11) of the CTN Act because they don’t have the same wording. To this Ahluwalia said that if they have powers under two laws but they have just used one then the two should be harmoniously constructed.

    Ahluwalia will continue on the commercial aspects of the the enforcement of the ad cap case tomorrow after which broadcasters will get a chance to submit their rejoinders.

  • TDSAT & Ad cap: TRAI almost done with its arguments

    TDSAT & Ad cap: TRAI almost done with its arguments

    MUMBAI: The third day of the arguments presented by the Telecom Regulatory Authority of India (TRAI) saw several crucial points being touched upon and the TDSAT also noting down points that could be pondered upon for rumination.

    The TRAI counsel Rakesh Dwivedi pointed out that if one reads section 7 (11) of the Cable TV Networks (CTN) Act then it must be read with the ad cap regulation because the regulator was using it only to enforce this section.

    Section 7 (11) states that the authority has the power to ‘seize equipment used for operating the cable television network if it is found to be breaching its other sections’.

    According to the TRAI, programmes and advertisements are different and the regulator is trying to prevent intermixing of these two and ensuring an increase in quality of service.

    The regulator also gave its version regarding Article 19 (a) of the Constitution saying that airwaves and frequencies are a public property of the government and so there is no fundamental right that can apply to it. Electronic media and press are different and cannot be treated equally. Broadcasters are companies and not citizens so fundamental rights don’t apply to them, Dwivedi argued.

    The point about misuse of clock hour was once again raised by Justice Aftab Alam to which the TRAI reverted by saying that the clock hour regulation instituted by the TRAI and the CTN Act are the same thing and they cannot be interpreted in any other way. Broadcasters are thinking of a bankable hour, that can be carried over within 24 hours but the TRAI says that a clock hour is fixed.

    The bench questioned the TRAI that if it could have enforced the ad cap law under the CTN Act then it need not have made a separate regulation or a direction or use the TRAI act for it.

    To this, counsel said that the CTN Act only applies to cable operators at this stage. And just because they have two powers that are coinciding they cannot take away one power. The point where broadcasters come into the picture of this Act, is for the advertising and programming code, which they have to adhere to by virtue of them having to apply for an uplinking and downlinking licence.

    The TRAI counsel also requested that merely because it had framed a regulation or passed a direction the bench may not nullify it because it has passed it under the TRAI act and not the CTN act, although it has powers under both. He also requested that if the bench were to find anything wrong with the ad cap regulation, they may modify it. However, Alam said that it cannot be done since it was a delegated regulation. To this TRAI asked the bench to consider it as a direction and then modify it keeping in mind the best interest of the viewers.

    One of the arguments, that the counsel raised, relates to Article 14 of the Indian Constitution that speaks about the fundamental right to equality. He stated that it would be in fair spirit if cable operators and broadcasters are not equated with each other at this juncture. The TRAI counsel presented data which clearly showed that broadcasters were airing TV commercials for an unbearable duration every day in between programmes and hence it had decided to apply the ad cap to them first. The limits on TV commercial time will be imposed on cable operators later by the TRAI, the counsel revealed. And the fact that cable ops will be made to comply later does not mean that broadcasters should be excluded from the ad cap now.

    The counsel said he would be addressing the issue of clubbing channel genres together on Monday.

    The bench asked the TRAI why it wasn’t willing to wait till digitization was completed to impose the ad cap regulation. The TRAI argued that by September 2014, nearly 50 per cent of the country will be digitized. Hence it was a good enough reason to bring in ad time limits rules now so that TV air time could be slowly modulated over the period. The TRAI counsel agreed the regulation may not be perfect in its current form, but that does not give the TDSAT a reason to strike it down.

    Regarding FTA channels, Dwivedi said that the broadcasters had not given the TRAI any financial or commercials analysis of the minute by minute usage of ad time and data to support that ad revenues will indeed fall when the ad cap comes into effect. Hence, the regulator had made a general reccee of the channels and deduced what needed to be done and only then drawn up the ad cap regulation. It also stated that FTA channels don’t have too many ads so TRAI did not know why they were objecting to it.

    At the end of the proceedings, an important observation was made by the TDSAT that if the ad cap regulation is struck down, no law can be contended except section 7 (11) of the CTN Act, because broadcasters have accepted this act. Articles 14 and 19 (1) (a) of the Constitution are against the imposition of the ad cap regulation and then the only thing that remains is the interpretation of the 7 (11) section of the CTN Act.

    The TRAI will continue with its arguments on Monday and the broadcasters are scheduled to speak after that.

  • TDSAT & Ad cap: TRAI continues arguments

    TDSAT & Ad cap: TRAI continues arguments

    MUMBAI: Continuing to present its side to the Telecom Disputes Settlement Appellate Tribunal (TDSAT), the Telecom Regulatory Authority of India (TRAI) put forth its arguments to the bench consisting of Justice Aftab Alam and member Kuldip Singh.

    It started off continuing on yesterday’s argument trail saying that the law does not state that if the laying requirements are not fulfilled then it becomes void. That is, TRAI cannot execute its regulation on channels. That broadcasters are covered by both the Cable TV Networks Act and the TRAI act is a parliamentary mandate and there is nothing illegal in what it is doing. There are several precedents where a subject matter could be covered by more than one statute,  TRAI counsel  Rakesh Dwivedi stated.

    TRAI also claimed that it has a clear parliamentary mandate exercised through the central government to regulate advertisements. It contested the broadcasters’ arguments that TRAI has just a recommendatory role, by highlighting that it has an additional function under section 11 (1) (a) of the TRAI  Act and that does not mean its plenary functions under section (11) (1) (b) are taken away. Therefore, apart from its recommendatory function under (a), its powers also remain under (b). Both the sub clauses complement each other and there is no clash, the counsel stated.

    Reiterating that it has the authority, it said that what it is aiming to do is in perfect accordance with the powers the ministry and it has under section 7 (11) of the Cable TV Act. Likewise, the counsel, said it is not as if the government is seeking to have a higher allowance for advertising air time and is in disagreement with the limit of 12 minutes that the TRAI is seeking to impose.

    To support its argument, the counsel also read out various preceding judgments. According to the TRAI, broadcasters are licensees under the Telegraph Act and so the regulator has full power to ensure compliance within the licence term.
    Singh asked if TRAI can direct Google on the duration and number of ads it can run. To this, the TRAI counsel replied by saying: ‘I am the regulator and I will decide who, when and how much to regulate.

    Coming to the point raised yesterday about a statement TRAI had made in 2004 that “there should not be any regulation at present on advertisement on both FTA and Pay channels” it said that much water had flown under the bridge since it made its statement and the situation was different today. So, it can deem it appropriate to regulate since an expert opinion at one point of time does not mean that it will stay forever, the counsel stated.

  • TRAI presents its ad cap arguments

    TRAI presents its ad cap arguments

    MUMBAI: After nearly a week long argument from the News Broadcasters Association (NBA) and music channels – B4U, 9XM, Mastiii and M Tunes — it was time for regional players and the big daddy – the Telecom Regulatory Authority of India (TRAI) to present their side of the story on the ad cap.

    Among those who presented their case today were Polimer Media and south India biggie Sun TV. The channels brought to the fore a point from February 2011 when TRAI had confirmed that “there should not be any regulation at present on advertisement on both FTA and Pay channels.”

    It had taken this position in Petition No. 34(C) of 2011 in the TDSAT filed by a society called Utsarg against TRAI and several other broadcasters and content aggregators seeking a cap on television advertising time on the ground that these advertisements interfered with viewership of television programmes. The channels questioned the reversal in TRAI’s  stance today.

    Now, it was the turn of the TRAI to send its lawyer to make its deposition.  TRAI argued that it was right in taking recourse to  both the Acts – the Cable Networks Regulation Act 1995 as well as The Indian Telegraph Act 1885 and the TRAI Act – and it was empowered under both as broadcasters are licensees under the latter. To this, the bench comprising of Justice Aftab Alam and member Kuldip Singh said that if it already has the authority under the Cable TV Act then it should not have acted on the TRAI Act.

    However, TRAI argued that the Cable TV Act is applicable only to cable operators and the bench in turn responded that a broadcaster does not come under it then. TRAI claimed that they were merely interpreting section 7 (11) of the Cable TV Act of 1995 which says that the authority has the power to ‘seize equipment used for operating the cable television network’ if it is found to be breaching its other sections.

    On the laying of the ad cap regulation in Parliament, TRAI’s counsel said that it had submitted it to the relevant ministry. To this, the bench responded that the law decrees that it would become applicable only after it is accepted or rejected or modified in the house. All the actions TRAI takes won’t apply with retrospective effect. Hence if TRAI  prosecutes a broadcaster before laying in parliament would not that be a violation of fundamental rights was the question?  The argument was then that in such a situation it is beyond the jurisdiction of the TDSAT and comes under the ambit of the Supreme Court.

    One of the points raised by the petitioner channels was the possible misuse of the 12 minute ad cap regulation. It said that a broadcaster could have uneven advertising slots such as one minute of advertisement in the first 30 minutes while the next half an hour could have 11 minutes. Similarly the concept of clock hour too had its flaws. Hypothetically, a broadcaster could air 11 minutes of ads from7:49 pm to 8 pm and then another 11 minutes of commercials between 8:00 pm to 8:11 pm. That would mean TV viewers would be subjected to 22 minutes of commercials in an hour of television time, thus putting paid to TRAI’s mandate to maintain quality of service. To this, the TRAI claimed that all laws can be misused but then it doesn’t stop them from being made.

    TRAI will continue its arguments tomorrow.

  • What the music channels said on the ad cap issue

    What the music channels said on the ad cap issue

    MUMBAI: After the News Broadcasters Association (NBA) presented its side of the story, it was the turn of the music channels to present their case in the Telecom Disputes Settlement Appellate Tribunal (TDSAT) regarding the troublesome 12 minute ad cap regulation that is being enforced by the Telecom Regulatory Authority of India (TRAI).

    The hearing that went on for two days (Monday and Tuesday) had the music channels counsel speaking on behalf of the four music channels – 9XM, B4U, M Tunes and Mastiii. The main point raised was violation of Article 14 of the constitution of India by the TRAI. The Article states: “The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India Prohibition of discrimination on grounds of religion, race, caste, sex or place of birth”.
     
    According to counsel, the TRAI is violating Article 14 by putting all the channels in the same basket. There are different types of broadcasters delivering both free to air and pay channels in the genres of news, sports, music etc. It is inappropriate to be treating ‘unequals as equals’ by classifying all channels in the same category, counsel emphasized. To support his argument, he said that FTA channels don’t get subscription revenue and work on purely advertising while pay channels have the benefit of both.
     
    Apart from this, other issues raised during the hearing were similar to the ones the NBA counsel had raised such as the jurisdiction of the TRAI to come out with such a regulation, unregulated and high carriage fees and high cost of content production.
     
    There is a long list of channels that will now present their cases in front of the TDSAT bench of Justice Aftab Ahmed and member Kuldip Singh including Reliance Big Broadcasting, Sun TV Network, Raj TV, E24 Glamour, Eenadu Television and Polimer Media.
     
    After this, TRAI will defend itself. The hearing is set to continue today.
     
    This is surely one case that will take much time to resolve.

    To read about previous reports on the case scroll down.

  • Day 3 of TDSAT ad cap hearings

    Day 3 of TDSAT ad cap hearings

    MUMBAI: The queue of channels waiting their turn to present their individual cases on the so-called crippling TRAI 12 minute ad cap to the Telecom Disputes Settlement Appellate Tribunal (TDSAT) has not really got any shorter even as the hearings got into the third day. The reason: the News Broadcasters Association’s (NBA) lawyers continued with their arguments in the presence of TDSAT’s Justice Aftab Alam and member Kuldeep Singh.  

    And with their presentation referencing statutory laws as relating to the Cable Television Networks (Regulation) Act and the TRAI Act 1997 completed they have now progressed to bringing in references about media freedom as written in the Article 19A of the Indian Constitution. 

    The NBA counsel referred to the ‘Sakal Papers And Others vs The Union Of India on 25 September, 1961’ case. The Supreme Court had then affirmed that a newspaper should have the liberty to carry as many advertisements as it would want to because ‘curtailment of advertising is a curtailment of free speech as guaranteed by the Constitution of India.  

    The declaration of this case reads: ‘the state could not make a law which directly restricted one guaranteed freedom for securing the better enjoyment of another freedom. Freedom of speech could not be restricted for the purpose of regulating the commercial aspect of the activities of newspapers.’ 

    According to the NBA, since such a  ruling exists for print newspapers, it should also apply to the broadcast medium. However, Alam tended to disagree and opined that that the electronic medium is different from print.

    The NBA also contended that broadcasters don’t actually get a ‘license’ from the central government under The Telegraph Act 1885 but rather a ‘registration’ under the uplinking/downlinking policy guidelines. However, the justice  doubted that the broadcasters don’t get a licence, and he also felt that broadcasters don’t come under the cable TV act as the NBA is claiming. 

    During the 12 November hearing, the NBA had argued that TRAI had not done the laying requirements as per section 37 of the TRAI Act which it should have in order to carry out enforcement of ad cap and prosecution of erring channels.

    The hearings are slated to continue tomorrow morning with the NBA and its lawyers presenting their arguments.  For the other channels, the wait continues. To read about previous reports on the case scroll down.

  • TDSAT: Ad cap saga continues on Day 2

    TDSAT: Ad cap saga continues on Day 2

    MUMBAI: The hearings on TRAI’s proposed 12 minute ad cap regulation by the Telecom Disputes Settlement Appellate Tribunal (TDSAT) that began yesterday look unlikely to get over in a hurry. For the past two days it is the News Broadcasters Association (NBA) which has been presenting its case to the tribunal. Today, the NBA counsel raised the point that the TRAI had not fulfilled the laying requirements to the parliament as per section 37 of the TRAI Act which says that “the Regulations made by the TRAI have to be placed before the Parliament to seek its approval. Thus, there can be no dispute that the regulations framed by the TRAI have the force of law having been made through the process of subordinate legislation provided they are consistent with the Act and Rules.”

    Any law infringing the fundamental rights of the people needs to be laid before the parliament after which it can be either annulled or amended or approved by the parliament, says a counsel. A senior broadcaster who has been following the case closely says, “If anything is a law then it has to be passed by the legislature.”

    Therefore, the NBA said that TRAI is crossing its line by enforcing the ad cap and prosecuting channels that aren’t following it. TDSAT Justice Aftab Alam wanted to know from TRAI if they had laid it before parliament as it’s an issue that should have been dealt in the preliminary stages itself to which TRAI did not have a substantial reply.

    In yesterday’s hearing, one of the points put forth by the NBA counsel was section 2(G) of The Cable Act of 1995 according to which advertisements are a part of content. At this, TDSAT wondered how a broadcaster can come under this act. Counsel for NBA today validated the position under this act by stating that permission for uplinking falls under the Cable Act bringing broadcasters under this Act. It also says that channels adhere to the programme code.

    Since the Cable Act comes under the jurisdiction of the Information and Broadcasting (I & B) ministry, broadcasters fall under the purview of the I & B ministry and not TRAI.

    NBA also contended yesterday that TRAI does not have the authority to regulate content and its powers are restricted only to licensing and quality of service while content regulation falls under the ambit of the I & B ministry. Neither the TRAI Act nor the Indian Telegraph Act, under which TRAI works, gives the regulator the powers to deal with content.

    The case will continue tomorrow post noon when NBA will put forth more points in front of the TDSAT.

    Read here for yesterday’s hearing:
    TDSAT hearing on ad cap to continue tomorrow