TRAI notifies draft DAS tariff & interconnect rules

NEW DELHI: The Telecom Regulatory Authority of India (TRAI) has made life a little simpler for MSOs. Last weekend (20 September 2013) it notified the amendments to interconnection regulations applicable for Digital Addressable Systems (DAS) and also to the tariff order for DAS the drafts of which it had released for industry consultation on 4 June 2013. 

It has some further changes following industry feedback. Amongst these include: 

* The removal of the minimum channel carrying capacity of 500 channels for MSOs.

* It has clarified that subscribers can either opt for channels on a-la-carte basis or bouquet or combination of both, as per their choice. 

* It has disallowed MSOs from seeking a channel from a broadcaster while at the same time seeking carriage fees from it. 

* It has forbidden MSOs from charging placement fees. 

 The amendments in the Telecommunications (Broadcasting and Cable) Services (Fourth) (Addressable) Systems) Tariff (Second Amendment) Order 2013 modify the ‘twin conditions‘ that regulate the a-la-carte rate of channels vis-a-vis the bouquet rates at retail level protecting subscribers’ interests. It also clarifies the position that subscribers can either opt for channels on a-la-carte basis or a bouquet or a combination of both, as per their choice. 

Considering the fact that the operators would be required to make appropriate changes, both in pricing and packaging, the Authority has decided to make the ‘twin conditions’, prescribed through this tariff order mandatory with effect from 1 January 2014. However, during the period from the notification of this tariff order till 31 December 2013, operators would be required to offer channels, complying to either of the two conditions, specified in the ‘twin conditions’. 

The operators are, however, free to make their offering, complying to the ‘twin conditions’, if they wish to do so before 1 January 2014. 

Further, in case a channel forms part of more than one bouquet then the above conditions will have to be satisfied for all such bouquets. Further, if the operator offers discounts to its subscribers on bouquet rates, the above said ‘twin conditions’ should also be satisfied with such discounted bouquet rates. 

Therefore, the Authority felt it appropriate to extend the a-la-carte provisioning of channels to cover both the FTA and pay channels carried over the network of an operator.

Accordingly, vide the tariff amendment order dated 30 April 2012, it was mandated that every operator providing services to its subscribers using an addressable system shall offer or cause to offer all channels, whether pay or FTA, offered by it to its subscribers on a-la-carte basis. In sync with this provision, the word “pay” has been deleted from the heading of clause 6 and also from the clause 6(2) of the principle Tariff order dated 27 July 2010. With the removal of word ‘pay’, an operator can specify a minimum commitment period, not exceeding three months for both ‘pay’ and ‘FTA” channels, subscribed on a-la-carte basis. 

The TRAI has noted that “it has been observed that, some of the DTH service providers have been imposing pre-condition for subscribing to a particular bouquet before add-on-bouquets and/or a-la-carte channel(s) can be subscribed. The Authority is of the view that such conditions are unreasonable and the consumer should be free to choose any combination of the channel(s) or bouquet(s) offered by the operator. In the tariff amendment order dated 30 April 2012, a provision was made which allowed the DAS subscriber to subscribe to basic service tier or basic service tier and one or more pay channel or only free to air channels or only pay channels or pay channels and free to air channels at his option i.e. consumer is free to choose any combination of the channel(s) or bouquet(s) offered by the operator. 

Accordingly, sub-clause (4) of clause 6, applicable for addressable platforms other than DAS, has been suitably amended and a proviso has been added to bring in parity amongst various addressable platforms as well as to ensure that consumers of these platforms are on equal footing. 

The Interconnection Regulation applicable for DAS has the following safeguards with regard to charging of carriage fee: carriage fee to be transparently declared in the RIO of the MSO; the carriage fee is to be uniformly charged; the carriage fee not to be revised upwardly for a minimum period of 2 years, and the details of the carriage fee are to be filed with the Authority and the Authority has a right to intervene in cases it deems fit. 

The Authority has decided that the phrase “having the prescribed channel capacity” appearing in sub-regulation 3(2) of the Telecommunication (Broadcasting and Cable Services) Interconnection (Digital Addressable Cable Systems) Regulations 2013  should be deleted as the same will have no relevance with the deletion of the minimum channel carrying capacity criteria from the regulations.

For the time being, the Authority has decided not to specify the capacity to carry a minimum number of channels by the MSOs, on the expectation that market dynamics will take care of the emerging situation. However, in the event the Authority notices that the market dynamics are not allowed to function freely by the service providers, resulting in creation of an artificial capacity constraint, it will intervene appropriately. 

Analysing the issue of placement fee, TRAI has noted that the DAS technology provides for an Electronic Programme Guide wherein the channels being carried on an MSO’s network can be arranged in a simple, easy to understand, manner so that the subscriber can easily go through this guide and select the channel of his choice instead of flipping through all the channels.

The genre-wise display of channels in the EPG, where all the channels of a particular genre are listed under relevant genre, has been mandated through regulations. Moreover, in digital systems, signal quality of the channels is independent of the placement of the channel. 

Further, the Interconnection Regulation already has a provision (sub-regulation 3 (11)) that if an MSO, before providing access to its network, insists on placement of the channel in a particular slot or bouquet, such precondition amounts to imposition of unreasonable terms. Thus, adequate provisions already exist in the regulations. Accordingly, sub-regulation 11A of regulation 3 of the interconnection regulation has been deleted. 

The amendments follow a judgment of the Telecom Disputes Settlement and Arbitration Tribunal and a consequent fresh consultation paper by TRAI and reactions on it from stakeholders. 


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