LMOs sniff a benefit from TRAI entry

NEW DELHI: No sooner has a regulator for the broadcast and cable sectors been notified by the Indian government than cracks have started appearing in the fragile unity the cable fraternity had forged in the run-up to the CAS rollout in South Delhi.

Independent and last mile operators (LMOs) are now talking about making a bid to "break the monopolies" in ground distribution, especially that of big multi-system operators (MSOs) like Siti cable, Hathway and INCableNet.

Pointing out that they propose to submit a memorandum to the newly-notified regulator, the Telecom Regulatory Authority of India (TRAI), over the next few days, an independent cable operator said today, "Now that a regulator is in place, we would raise the issue of monopoly of the big players."

The other issues likely to be with TRAI include that of cross-services restriction, choice to a consumer in choosing a cable operator and putting cap on the advertising time on pay channels.

"Whenever we have talked about cross-service restriction, the MSOs have shouted us down. But now, we will raise the issue with TRAI," another cable op said.

By cross-service restrictions, the cable ops mean that either there should be ban on broadcasters owning stakes in cable networks or there should be a cap (on the lower side) on such holding to reduce "vested interest" and preferential costing" taking place.

At the moment, two of the biggest broadcasters, Zee Telefilms and Star India, have equity stake in cable distributing companies. While Siti Cable is a subsidiary of Zee Tele, in the Rajan Raheja-controlled Hathway Datacom, Star holds 26 per cent stake. Similarly, the parent company of Sun group of channels also owns a cable network in South India. Though the Hinduja-owned 

InCableNet doesn't have any direct links with broadcasting owned by the parent company, noises have been made by the Hindujas that they have plans to launch satellite-delivered TV channels.

Asked about signs of rebellion in the ranks of the cable fraternity, a senior executive of an MSO today lamented that this "disunity" may spell doom for independent and local cable operators.

"Bahut dukh likha hain een cable operators ke taqdeer mein (fate has lot of bad news in store for these cable operators)," the MSO executive said on condition of anonymity.

A representative of another MSO sarcastically said that "unless these independent cable ops go to TRAI and advise it on how to do things," the industry would probably come to an end.

But, that the fear of big telecom companies getting into cable service is playing on the minds of big and cable ops is evident. Agreeing with's editorial under Comment and also the report filed last week on TRAI, the head of an MSO said that if the clauses of unified licence --- being discussed by TRAI and the telecom players--- are read in conjunction with the latest developments, then the picture would become clear.

"There is no doubt that it is just a matter of time before telecom companies foray into cable services, which have now been redesignated as telecom services," he added.


Meanwhile, the new regulator, which seems to have taken up its job in all earnest, on Monday added a new twist to the CAS (conditional access system) saga, saying deferring or letting the rollout continue is not within its jurisdiction.

Reiterating that it would issue a short consultation paper on CAS soon, TRAI chairman Pradip Baijal was quoted by the Press Trust of India (PTI) today as saying, ""The issue of continuing the service is not my jurisdiction".

This was in response to a question posed by the agency whether the consultation paper would tantamount to deferring CAS till the regulator finalised and issued guidelines on the issue.

In a way, Baijal was not much off the mark as the role of the regulator is recommendatory and a final decision on CAS would have to be taken by the government on recommendations made by TRAI. 

The decision on issuing a consultation paper comes amidst reports that CAS would be deferred till the general elections. The Bharatiya Janata Party (BJP)-led coalition government over the past few days has been hinting that the general elections are likely to be held between March and May, though no fixed time-table has been indicated to yet.

"We will issue a short consultation paper tomorrow", Baijal told PTI after holding a series of meetings with officials concerned on the issue. But he did not give details on the focus of the paper.

Baijal, who had put consumers' interest at top of his priority after being given the new responsibility, was quoted in the agency report as saying that he would give about 15 days for the various stakeholders to revert with their responses. 

From the time CAS was sought to be rolled out in South Delhi area, after a November verdict on CAS by the Delhi high court, the issue had thrown up various confrontations between the cable industry and the consumers, represented by consumer groups.

A new case, filed by two parties, including a conglomeration of 50-odd consumer bodies in the country, is still pending a final verdict of the Delhi high court. The court had observed that till the next date of hearing on 5 April, the rollout of CAS should be monitored.

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