Tdsat hearing: MSOs object to basic service tier conditions in Trai tariff order

NEW DELHI: The Telecom Regulatory Authority of India (Trai) has negated the very concept of a basic service tier (BST) for a bouquet of free-to-air television (FTA) channels, by giving a “confusing and faulty” Tariff Order, an MSO counsel told Tdsat while arguing against the order.

The order says that a subscriber will be provided a BST of 100 free-to-air (FTA) channels at a fee of Rs 100 but goes on to add that "it shall be open to the subscriber to choose any combination of free to air channels up to 100 channels, in lieu of the BST offered by the multi-system operator."

This nullified the meaning of BST, counsel for MSO Delhi Distribution Company Navin Chawla, told Tdsat (Telecom Disputes Settlement and Appellate Tribunal), which is hearing cases challenging the Trai Tariff Order of 30 April.

Chawla pointed out that the order also wants the BST offered by the MSO to include at least five channels of the each genre, namely news and current affairs, infotainment, sports, kids, music, lifestyle, movies and general entertainment in Hindi, English and regional language of the concerned region.

He argued that if five channels for every language was provided, then the number of channels with all the genres would easily cross 100.

He claimed Trai had done no study to find out whether an average viewer wanted 100 channels in the BST.

In any case, he said a similar order of 2007 had been challenged by the MSO Alliance and others before Tdsat, which had held that that the order had failed to specify tariffs and had only given a ceiling and slabs and that Trai needed to revisit the exercise to fix the tariffs in a holistic manner. Tdsat had also clearly stated that tariff meant the cost that the consumer has to pay.

Chawla said merely because the matter had gone in appeal before the Supreme Court which has ordered status quo till final disposal was no reason for Trai to commit the same flaw five years later. "Each word remains the same and we are back to square one," he claimed.

He said in any case, no formula for revenue sharing could be laid down unless all the beneficiaries were named. In this case, there had been no reference to the broadcaster and only the MSO and local cable operators (LCOs) had been named. Furthermore, he said a revenue sharing can only be talked about when a systematically worked out revenue figure is given.

He said Section 11(2) of the Trai Act 1997 stated: "The Authority may, from time to time, by order, notify in the Official Gazette the rates at which the telecommunication services within India and outside India shall be provided under this Act including the rates at which messages shall be transmitted to any country outside India".

Thus, the Act was very clear that the Authority should lay down the tariff that a consumer will have to pay, but this had clearly been overlooked by the Authority which had merely indulged in ‘patchwork’ and not fulfilled its duty. He said a new system like the digital addressable system needed a new Tariff formula, but Trai had merely amended the Tariff Order of 2010.

Chawla claimed that no exercise had been undertaken to work out the costs incurred either by the MSO or the LCO.

He said soon after Trai was given charge of broadcasting in 2004, it had frozen the channel-wise rates in January that year since it was new to the field. That directive had not led to any litigation, and therefore, a similar formula could have been adopted. He said this suggestion had been given to Trai when it held consultations with stakeholders before issuing the latest Tariff Order.

Chawla said that in any case, fixation of the BST should have been the domain of the MSO and the government should have interfered only if all the genres were not supplied to the consumer.

He also challenged the rationale for keeping the overall number of channels at 500. He said that an MSO would have to spend money to put up the technology for receiving so many channels, even if the viewers did not want so many channels. No rationale had been given even for the 100 in the BST or how public interest would have been affected if the number had been different.

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