Direct to Home Television Service refers to distribution of Multi Channel TV programmes in Ku Band by using a satellite system by Providing TV signals direct to subscribers' premises without passing through any intermediary such as cable operator. Its reception requires very small dish antenna (12"-18"dia.) as compared to large dish antenna (8-16 feet dia.) in the lower C band frequency. It provides a better quality reception by using digital technology. It also provides more choice to consumers. It is ideally suited for areas which are not serviced by Cable TV and at the same time provides an alternative to consumers in areas already serviced by Cable. DTH can also provide a broad band back-bone for convergence IT enabled services.

However, keeping in view the sensitive nature or this service, particularly its implications for national security, cultural influence, moral and social values etc., as it reaches direct to viewers home without any intermediary, reception and distribution of television signals in Ku band was prohibited by a Notification, dated 16th July, 1997 issued under the Indian Telegraph Act and Indian Wireless Telegraphy Act. Due to rapid changes in the information technology and sea-changes in the broadcasting and communication scenario in the last few years, the reason for which DTH was not allowed in 1997, are no longer relevant now. Moreover, DTH is a superior technology which offers an alternative for distribution and reception of television programmes both to the programme providers as well as to the consumers.

Keeping in view its numerous advantages, Government constituted a Group of Ministers 31st January, 2000 (by reconstituting the earlier GoM constituted on 21st January, 1999) to consider the issues connected with the Direct to Home Television Broadcasting and make recommendations. The GoM considered the issue related to DTH in its various meetings held between March and October, 2000 and came to the conclusion that DTH should be permitted in India with suitable safeguards so as to take care of the concerns related to national security, morality and vertical monopoly in distribution and broadcasting of television services. GoM also considered the advantages of DTH technology, not only in distribution of television channels but also for its role in convergence and providing various IT enabled services.

The GoM, therefore made a unanimous recommendation that DTH Television Services should be permitted in India so as to take advantages of the latest technology which ensuring that the concerns relating to nationall security , morality and monopoly are taken care off by , interalia, providing for the following:

(i) DTH license should not be given exclusively to any agency, whether private or public, so as to avoid monopoly in this sensitive area of information and programme distribution.

(ii)DTH being an alternative to cable for distribution of television programmes, the vertical integration of these two should be guarded against to avoid monopoly in distribution servives.

(iii)Vertical integration and monopoly between DTH operators and TV channels should also be avoided to ensure fair competition and level playing filed for all the channels.

(iv) In order to ensure that the programme/channels distributed through the DTH platform comply with the Programme and Advertisement Codes, these should be mandatorily uplinked from India. This will also take care of the concerns relating to national security.

Based on the above, the Group of Ministers recommended allowing DTH in India subject to certian terms and conditions.

The recommendation of the Group of Ministers was considered by the Cabinet in its meeting on 2nd November, 2000 and the cabinet approved permitting DTH Services in India subject to terms and conditions as detailed in the annexure.

GUIDELINES AND TERMS AND CONDITIONS FOR ESTABLISHEMENT, MAINTENANCE AND OPERATION OF DIRECT-TO-HOME(DTH) BROADCASTING SERVICES.

(To be issued by the ministry of Information and Broadcasting)

Government of India has decided to open up the Direct-to-Home (DTH) broadcasting services in India. This service can be operated by a person or company. The guidelines and terms and conditions for grant of license for DTH Broadcasting Services will be as follows:

(i) The applicant comapny shall be an Indian company, registered under the Indian Companies Act, 1956.

(ii) The Total Foreign Investment* including FDI/NRI/OCB/FII in the DTH Broadcasting sector,shall not be more than 49% in which the share of FDI will not exceed 20%.

Provided that the quantum represented by that proportion of the paid up equity share capital to the total issued equity capital of the Indian promoter company held or controlled by foreign investors through FDI/NRI/OCB investments shall form part of the above said FDI limit of 20%.

No Broadcasting Company and/or Cable Network Company shall be eligible to own more than 20% of the total equity of an applicant Company at any time during the license period.

Provided further that the Licensee, at all times, shall keep the Licensor informed of any change in the holding pattern of the Equity.

(iii) The applicant company must have Indian management control with majority representatives on the Board, as well as the CEO of the Company being a resident Indian citizen.

(iv) There will be no restriction on the number of licensees and the license will be issued by the Government for a period of 10 years on non-exclusive basis.

(v) The applicant company shall be required to pay an entry fee of Rs.10 crores, in the beginning. In addition, 10% per year of the revenue collected by the platform owner shall be payable to Government as annual fee. The licensee would also be required to execute a Bank guarantee of Rs.40 crores valid for the duration of the licence. Licensee will be required to pay the license fee and royalty for spectrum used, as prescribed by the Wireless Planning Coordination authority (WPC), under the Department of Telecommunications.

(vi) The Licensing Authority shall have the power, after recording the reasons in writing, to revoke/suspend the license in public interest. However, before taking such action the licensing authority will give the licensee an opportunity of being heard. The decision of the licensing authority shall be final.

(vii) For violation of license conditions, in addition to any other action which may include revocation of license, a penalty upto Rs.50 crores can be imposed by the licenser on the Licensee. However, before taking such action the licensing authority will give the licensee an opportunity of being heard. The decision of the licensing authority shall be final.

(viii) The licensee shall establish the uplink Earth Station in India within 12 months from the date of issue of license. All Content provided by the DTH platform to the subscribers, irrespective of its source, to pass through the common encryption and conditional access system, located within the Earth Station, situated on Indian soil.

(ix) The licensee shall ensure adherence to the Programme Code (PC) and Advertisement Code (AC), laid down by the Ministry of Information and Broadcasting, from time to time. Record of the programmes and advertisements carried on the platform to be kept by the Licensee for a period of 90 days after broadcast and to be made available to the authorised representative of the Licenser, as and when required.

(x) The licenses shall provide access to various content providers/ channels on a non-discriminatory basis. The licensee shall not carry any channels prohibited by the Ministry of I&B.

(xi) Licensee shall provide access to the Licensing Authority or its duly authorised representative to all its facilities including equimnents, records, systems etc.

(xii) Though licensee can use the bandwidth capacity for DTH Service on both Indian as well as foreign satellites, proposals envisaging use of Indian satellites will be extended preferential treatment.

(xiii) The licensee shall ensure subscriber's interests through Single Conditional Access Technology, Single Subscriber Management System (SMS), an Open Architecture (Non-proprietary) Set Top Box, a Cast Iron Encryption System and an efficient, responsive and accurate billing and collection system. The Licensee shall not use any equipmnent, which is identified as unlawful.

(xiv) The Licenser reserves the right to prohibit the transmission or reception of programmes in the interest of national security or in the event of emergency/war , or similar type of situation notwithstanding any agreement, between the licensee and the content providers, the licensee shall stop forthwith, transmission of TV channels or any content, as and when directed to do so by the Licenser or any other designated lawful authority.

(xv) The DTH facility shall not be used for other modes of communication, including voice, fax, data, communication Internet etc. unless specific license for these value-added services has been obtained from the competent authority.

(xvi) The licensee shall obtain clearances/approvals as may be prescribed or required from the Wireless Planning Coordination Wing or from the Department of Space.

(xvii) The DTH Licensee will be bound to carry channels of Prasar Bharati on the most favourable financial terms offered to any other channel.

(xviii) The licenser reserves the right to modify or incorporate new conditions at any time in the terms and conditions of this license, as and when necessary in public Interest or interest of national security.

(xix) The licenses will adhere to provisions of any legislation which may be brought in future with regard to broadcasting.

Note: * Approvals for foreign equity shall be routed through the FIPB route.