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  • TRAI’s Arvind Kumar prescribes broadband medicine for MSOs & LCOs

    TRAI’s Arvind Kumar prescribes broadband medicine for MSOs & LCOs

    KOLKATA: Digital is it. Across the country, and age groups, Indians are getting online, and consuming more high speed broadband data than ever before, whether it is for entertainment, education, commerce or banking. While the telcos have been serving their needs for a large part, the increasing maw for data and speeds has thrown up increasing opportunities for multi-system operators (MSOs) and local cable operators (LCOs)  even as their video distribution operations are seeing churn.

    The Telecom Regulatory Authority of India (TRAI) advisor Arvind Kumar spoke about this potential future of MSOs in a virtual fireside chat hosted by Elara Capital. Kumar said that a number of people want broadband services currently and they are looking at fibre-to-home services. According to him, it is not possible for a telecom service provider to satiate the demand of 300 million households even in the next ten years. 

    Read our coverage on TRAI 

    “Therefore MSOs must focus on providing a broadband connection with cable TV services. This is right for them. This makes a very good business case for the MSOs. Neither any TSP will be able to fight with them, nor DTH operators will be able to do so. The MSOs should focus on how to give broadband service at the same time along with cable services to retain subscribers,” Kumar added. He also mentioned that the Covid2019 crisis has proved the demand for broadband connectivity. 

    He is optimistic about the ability of MSOs to stave off the competition from DTH operators despite the latter having a technological edge. Kumar opined that MSOs can compete with DTH operators in terms of the quality of service, cost-effectiveness and broadband services. Considerably, reports came out after the implementation of the new tariff order indicate that MSOs are losing a large number of subscribers to DTH players.

    Read our coverage on MSOs 

    Along with other economic issues, MSOs face the issue of conflict with local cable operators (LCOs) quite often. According to Kumar, the two parties will keep getting at loggerheads with each other until they understand the whole game. He explained the need for LCOs to upgrade their thought process as well as technology. “The LCOs have to support MSOs to stay relevant in the game. Otherwise, both parties will lose their market share to other contenders,” he pointed out.

    Kumar emphasised that LCOs must concentrate on broadband plans and discuss with MSOs. They need to express the longing of coming into the overall picture. He also mentioned that Jio will get support from MSOs if they don’t receive it from the last mile operators. However, he added that LCOs have expertise in dealing with consumers, local authorities which is important to help any broadband operator.

    As per TRAI data, there were 19.38 million wired broadband subscribers in India as of 31 May 2020. The top service providers were BSNL (7.93 million), Bharti Airtel (2.41 million), Atria Convergence Technologies (1.64 million), Hathway Cable & Datacom (0.97 million) and Reliance Jio Infocomm Ltd (0.97 million). 

  • NTO 2.0 update: Broadcasters conclude their argument before Bombay HC

    NTO 2.0 update: Broadcasters conclude their argument before Bombay HC

    KOLKATA:  As the ongoing legal battle between broadcasters and the Telecom Regulatory Authority of India(TRAI) in Bombay High Court nears its ending, the broadcasters have concluded their argument.

    On 18 September, the solicitor general will open for TRAI before the court. TRAI chairman R S Sharma said earlier that non-implementation of NTO 2.0 will bring back discriminatory practices and create a regulatory vacuum. He said that the tariff order has brought the perfect balance between consumer choice and industry benefits.  

    Sharma mentioned that while it has given new power to the consumers to watch channels of their own choice, it has provided broadcasters the liberty to decide the pricing of their channels, distributors to have an independent source of revenue through network capacity fees.

    Earlier during a hearing on 2 September, senior advocate Harish Salve argued that NTO 2.0 contradicts provisions of the Indian constitution that guarantees the freedom of speech and expression to all citizens.

    Amid Covid2019 pandemic, TRAI directed the broadcasters on 24 July to comply with the new amendments by 10 August, which created another round of tension and the broadcasters went back to Bombay High Court. The High Court ordered TRAI to not take any coercive action against the stakeholders until the verdict comes out.

  • Wired broadband subscriber base sees turnaround in May

    Wired broadband subscriber base sees turnaround in May

    KOLKATA: After seeing a dip in April, the number of broadband subscribers reached 683.77 million at the end of May with an overall growth of 1.13 per cent.

    The Telecom Regulatory Authority of India (TRAI) has released the telecom subscription data as on May 2020. As per the report, the top five service providers constituted 98.93 per cent market share of the total broadband subscribers at the end of May.  The wired broadband sector has emerged as the top gainer with a growth of 1.88 per cent. However, home broadband footprint growth remains sluggish in the country. As on 31st May, 2020, the top five Wireless Broadband Service providers were Reliance Jio Infocomm Ltd (392.75 million), Bharti Airtel (143.55 million), Vodafone Idea (113.05 million), BSNL (14.14 million) and MTNL (0.29 million).  

    Overall subscriber growth: 

    Reliance Jio has added 3.73 million subscribers reaching 393.72 million overall. Among the top five players, Atria Convergence remains one of the top gainers touching a subscriber base of 1.64 million. At the end of last December, its subscriber base was at 1.52 million. Among other players, Bharti Airtel has seen an addition of 1.2 million subscribers, standing at 145.96 million subscriber base. 1.68 million new users have subscribed to Vodafone Idea’s broadband network in the month. State-run BSNL has also gained 0.53 million new subscribers. 

    Segment-wise growth:

    Among the telecom providers, Jio has gained in the wired broadband sector also as it has added 0.07 million in May. On the other hand, Airtel has lost 0.03 million subscribers. The top five Wired Broadband Service providers were BSNL (7.93 million), Bharti Airtel (2.41 million), Atria Convergence Technologies (1.64 million), Hathway Cable & Datacom (0.97 million) and Reliance Jio (0.97 million).

  • TRAI always believes intervention should be limited to market failures: R S Sharma

    TRAI always believes intervention should be limited to market failures: R S Sharma

    KOLKATA: The cable and broadcasting industry has been despondent of late due to several new regulations. Many of the stakeholders have complained about “over-regulation” stunning the growth of the business and causing unnecessary burdens. The outgoing chairman of the Telecom Regulatory Authority of India (TRAI), R S Sharma, has refuted the claims reemphasizing that the authority has always looked at light-touch regulation. Sharma stated that TRAI has always believed intervention should be limited to market failures, adding that it has never interfered if the market is trouble-free. He addressed several controversial issues.

    During a conversation with Governance Now MD Kailashnath Adhikari, Sharma has spoken in favour of the most controversial regulation of this year, the amended New Tariff Order (NTO 2.0). He said that the tariff order was brought to strike a perfect balance between consumer choice and industry benefits.

    Sharma mentioned that while it has given new power to consumers to watch channels of his own choice, it has also given broadcasters the liberty to decide the pricing of their channels, distributors to have an independent source of revenue through network capacity fees. “In such a situation, it will be unfair to call it over-regulation,” he commented.

    He reiterated that TRAI’s data shows that 90 per cent of the people watch only about 50 channels out of the 800-900 channels in the country. He also added that OTT platforms allow much more freedom to watch content compared to linear TV, and this is one of the primary reasons for the audience shifting to OTT platforms. After the implementation of NTO in last year, many long-tail channels shut their shops. “IBF’s statement is rubbish, and it brings fear in the minds of people,” Sharma stated, mentioning that the case is sub judice in court. 

    Earlier this year, when the pandemic started hitting the ad revenue dependent broadcasting industry, TRAI issued a set of recommendations for a major overhaul of the country’s TV viewership measurement agency, BARC India, a joint industry body of the broadcasters, advertisers, and advertising agencies. Recommendations included an increasing number of people meters from 44,000 to 66,000 by the end of 2020 and 1,00,000 by the end of 2022. Many stakeholders commented that it seemed to throttle the entire system rather than reforming. 

    “Audience measurement is a significant source for broadcasting to get advertising and program sponsorship. In fact, that is the only currency. An industry dependent on advertising for survival and growth, audience measurement is a critical activity. Broadcasting is one such sector that is largely dependent on advertising revenue. Broadcasters earned revenue Rs 45000 crore in 2019, 32000 crore was collected from advertising. This underlies the dependence on the flow of advertising, which largely hinges on the profile of their audience and popularity of the content, which is assessed by television audience measurement rating. It is imperative that the process of that measurement should be objective, fair, neutral, transparent,” Sharma commented.

    “Some important recommendations are the need for structural reformation of governing of BARC to mitigate the potential risk of conflicts, bring transparency, and the confidence of all stakeholders on the TV audience measurement system. To create a credible and accurate collection of data, multiple data agencies need to be in competition, which would bring new technologies, research methodologies, and new ways to ensure better data quality,” Sharma further adds. 

    According to him, technology is ever-evolving, and the TV rating system needs to be in tandem. While Sharma mentioned that TRAI only gave the recommendation of the constitution of BARC, he also stated that periodical reformations are needed. Many stakeholders raised the issue of huge investment in restructuring. He said that many reformations could be carried out in a frugal way on the back of new technologies.

  • Bombay HC orders conflicting parties to present submissions on the validity of sec11 of TRAI Act by 31 August

    Bombay HC orders conflicting parties to present submissions on the validity of sec11 of TRAI Act by 31 August

    KOLKATA: Amid the ongoing tussle between the Broadcasters and the Telecom Regulatory Authority of India( TRAI) regarding the amended new tariff order (NTO 2.0), the Bombay High Court’s division bench comprising of Justice A A Sayed, Justice Anuja Prabbhudesai heard the case on Thursday. The bench has ordered the parties to submit additional submissions on the validity of section 11 of the TRAI Act by 31 August. 

    The bench will hear the matter finally on 2, 7 and 8 September and will pronounce judgment following the hearings. As per today’s order, regulations will remain in force but no coercive steps can be taken by the regulator. It also added the Indian government is at liberty to file an affidavit on the validity of section 11 if needed. 

    Meanwhile, TRAI in a recent notification directed all broadcasters to comply with the provision of NTO 2.0 by 26 August, substituting the earlier timeline of 10 August as the final judgement on the case was expected on 24 August. The confusion regarding the implementation appears to persist as again the pronouncement of verdict has been postponed to next month. 

    Earlier this year,  the power to issue tariff orders by TRAI was challenged by broadcasters when they filed a writ petition on NTO 2.0 against the authority. “Violation of the mandatory principles of Section 11(4) of the TRAI Act and thus acting in a matter that is inconsistent with the TRAI Act, 1997” – was mentioned as one of the broad grounds of the challenge.

  • ZEEL reports higher subscription and OTT rights revenues for first quarter

    ZEEL reports higher subscription and OTT rights revenues for first quarter

    BENGALURU: Subhash Chandra’s Zee Entertainment Enterprises Limited (Zeel) reported a profitable quarter, albeit with steep declines in top-line and bottom-line numbers for the quarter ended 30 June 2020 (Q1 20210, quarter or period under review, COVID2019 quarter) as compared to the corresponding year-ago quarter Q1 2020. A number of Indian media and entertainment companies have reported a loss for COVID2019 quarter. Among other silver linings is growth in subscription revenue and growth in other sales and services which includes the sale of rights of movies to OTT platform. These numbers increased y-o-y by 5 per cent and 30.2 per cent respectively.

    Zeel reported 34.7 per cent lower y-o-y operating revenue at Rs 1,312.03 crore for Q1 2021 as compared to Rs 2,008.12 crore in Q1 2020. Total income (Operating revenue plus other income) fell 32.8 per cent y-o-y to Rs 1,338.41 crore from Rs 2,112.03 crore in Q1 2020.

    Ad revenue fell 59.5 per cent y-o-y in Q1 2021 to Rs 421.06 crore from Rs 1,186.71 crore in Q1 2020. Subscription revenue and other sales and service revenue increased y-o-y during the period under review as mentioned above. The company reported Rs 744.34 crore and Rs 708.77 crore as subscription revenue and Rs 146.63 crore and Rs 112.64 crore towards other sales and services for Q1 2021 and Q1 2020 respectively.  Zeel says in an investor presentation that subscription revenue increase was led primarily by increase in its OTT platform ZEE5 subscription revenue.

    Zeel says that international Ad revenue was Rs 37.1 crore, international subscription revenue was Rs 81.8 crore and other sales and services revenue was Rs 15 crore.

    Zeel reported profit after tax (PAT) of Rs 29.28 crore for COVID2019 quarter, which was just about one-eighteenth (declined 94.5 per cent) of the PAT of Rs 529.76 crore for Q1 2020. Operating profit (EBIDTA) for Q1 2021 was Rs 219.93 crore (16.8 per cent of operating revenue), or about one third (down 66.7 per cent) of Rs 659.75 crore (32.9 per cent of operating revenue) for Q1 2020.

    Let us look at the other numbers reported by Zeel for Q1 2021

    Total expenditure for Q1 2021 was Rs 1,280.80 crore which was 6.5 per cent lower y-o-y than the Rs 1,369.99 crore in Q1 2020. Operational costs in Q1 2021 were 15.7 per cent lower y-o-y at Rs 657.79 crore than the Rs 780.02 crore in Q1 2020. Employee benefits expense in Q1 2021 at Rs 200.12 crore was almost flat (fell 0.1 per cent) y-o-y as compared to Rs 200.33 crore in Q1 2020.

    Financial costs were less than a fourth (declined 78 per cent) y-o-y during the quarter under review at Rs 4.52 crore as compared to Rs 20.51 crore in Q1 2020. The company reported a fair value loss of Rs 112,33 crore in Q1 2021 as compared to a fair value gain of Rs 67.88 crore for Q1 2020 for its investments in overseas mutual funds. Advertisement and publicity expenses during the period under review at Rs 111.09 crore were 43.2 per cent lower y-o-y than the Rs 195.46 crore in Q1 2020. Other expenses in Q1 2021 at Rs 123.10 crore were 28.7 per cent lower than the Rs 172.56 crore in Q1 2020.

  • TRAI directs broadcasters to comply with the provision of NTO 2.0 by 26 August

    TRAI directs broadcasters to comply with the provision of NTO 2.0 by 26 August

    NEW DELHI: Telecom Regulatory Authority of India (TRAI) in a recent notification has directed all broadcasters to comply with the provision of the New Tariff Amendment Order (NTO 2.0) by 26 August. The broadcasters were previously asked to comply by NTO 2.0 by 10 August but due to the ongoing battle between broadcasters and the regulatory body, the date has been substituted by 26 August.

    The Bombay High Court’s Verdict on the NTO 2.0 case between broadcasters and the TRAI is expected on 24 August.

    The Indian Broadcasting Foundation (IBF) and other broadcasters had approached the Bombay High Court over the Telecom Regulatory Authority of India’s (TRAI) July 24 directive, wherein it has asked all broadcasters to comply with NTO 2.0 by August 10, despite the fact that the matter is sub judice and the final judgment has been reserved by the court.

    In one of the hearing, the case was listed before the original bench comprising Justice AA Sayed and justice Anuja Prabhudesai. While the legal battle is ongoing since long, TRAI citing a regulatory vacuum released a fresh directive on 24 July irking the broadcasters who have already been battling with the impact of the ongoing pandemic.

    It asked broadcasters to publish details including maximum retail price per month of channels and maximum retail price per month of bouquets of channels, the composition of bouquets and also amended reference interconnected offer (RIO) and other details on their website. 

  • Bombay high court’s NTO 2.0 verdict on 24 August

    Bombay high court’s NTO 2.0 verdict on 24 August

    KOLKATA: The Bombay high court's verdict on the NTO 2.0 case between broadcasters and the Telecom Regulatory Authority of India (TRAI) is expected on 24 August. Until then, all parties have agreed to wait before taking any further decision. 

    During a hearing last week, the court asked both parties to follow “gentlemen’s word” and TRAI also assured to not take any action against broadcasters who haven't yet implemented NTO 2.0.

    During Friday’s hearing, the case was listed before the original bench comprising justice AA Sayed and justice Anuja Prabhudesai. While the legal battle is ongoing since long, TRAI citing a regulatory vacuum released a fresh directive on 24 July irking the broadcasters who have already been battling with the impact of the pandemic.

    It asked broadcasters to publish details including maximum retail price per month of channels and maximum retail price per month of bouquets of channels, the composition of bouquets and also amended reference interconnected offer (RIO) and other details on their websites by 10 August.

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  • NTO 2.0: DPOs express discontent over partial implementation of regulation

    NTO 2.0: DPOs express discontent over partial implementation of regulation

    KOLKATA: With constant changes in regulations, the pay-TV sector in India continues to face uncertainty. Major broadcasters have come together to fight the implementation of the amended new tariff order (NTO 2.0) as directed by the Telecom Regulatory Authority of India (TRAI). However, distribution platform operators (DPOs) have already complied with the network capacity fee (NCF), multi-TV charges, etc., under the new directive and express dissatisfaction over the partial implementation. 

    “TRAI had asked all DPOs to adhere with NTO 2.0 on NCF, multi-home and others. As broadcasters have not given any new rates, you can’t implement the full NTO 2.0. If you implement half NTO, you have taken whatever is negative on your books but whatever positive we could take from broadcasters’ side has not happened. Hence, it is harmful to both DPOs and subscribers. We will be struggling how to handle it if the issues drag on and broadcasters don’t come out with new prices,” says GTPL Hathway CATV business head and chief strategy officer Piyush Pankaj.

    While broadcasters are reeling under Covid2019 impact, TRAI came out with a directive to implement NTO 2.0 by 10 August. As the petition against it was already sub judice, the broadcasters went to the Bombay high court challenging the directive. The court asked both parties to go by “gentlemen’s word” and TRAI assured it would not take any action till the next hearing. The court is hearing the case today before a bench comprising justice AA Sayed and justice Anuja Prabhudesai. 

    Another executive from a national MSO also brought up the fact that TRAI made all DPOs to implement the order on 1 March. But DPOs could not implement new pricing without broadcasters publishing it. Hence, many DPOs reached out to TRAI saying that either broadcasters should comply with all the rules or the authority should roll back pressure on DPOs. He also informs that one of the large broadcasters already published new pricing with 10-15 per cent hike but was continuing with the old reference interconnect offer (RIO).

    “Any channel which is above Rs 12 cannot be clubbed in a bouquet. If broadcasters don’t reduce the prices to be included in the bouquet that will affect all our bouquets,” says Metrocast Network Services promoter Nagesh Chhabria. However, he adds that there is no issue currently as Metrocast is continuing with the old model.

    “It’s an ecosystem, you cannot implement regulations in bits and parts,” says UCN Cable Network director Jagdish Paliya. However, he adds that NTO 2.0 is not very favourable for DPOs, too, as making a discount on second box compulsory is harsh on the operators.

    But what if the order comes in favour of the implementation of NTO 2.0? Here, the DPOs echo broadcasters’ view that executing it amid a pandemic would be very difficult. While approximately 15 million pay-TV subscribers cut the cord during NTO 1.0 implementation, the executive from a national MSO posed the most important question – will more subscribers drop off now?

  • NTO 2.0 hearing postponed, TRAI assures no action till next hearing

    NTO 2.0 hearing postponed, TRAI assures no action till next hearing

    KOLKATA: The uncertainty regarding the implementation of NTO 2.0 prevails, as the broadcasters’ petition against The Telecom Regulatory Authority of India's (TRAI) move to make them comply with the order by 10 August, went unheard for the second day on Friday due to paucity of time. The case has been listed before the original bench for Monday or Tuesday.

    Earlier, the Bombay high court, suspended all the hearings due to heavy rains on Thursday when the matter was listed for hearing.

    According to the sources close to the development, the bench has not passed any order at Friday’s hearing but has listed it before the original bench comprising of Justice AA Sayed and Justice Anuja Prabhudesai. However, TRAI has reassured no action will be taken till the matter comes up before the original bench. 

    While the legal battle is ongoing for a long-time, TRAI citing a regulatory vacuum released a fresh directive on 24 July irking the broadcasters who have already been battling with the impact of the pandemic. It asked broadcasters must publish details including maximum retail price per month of channels and maximum retail price per month of bouquets of channels, the composition of bouquets and also amended reference interconnected offer (RIO) and other on their website.