Regulators

DAS inter-connect regime: TRAI mulling distribution fee, data sharing

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MUMBAI: Indian broadcast regulator TRAI may propose a percentage of the total number of TV channels that a consumer subscribes (based on their maximum retail price as proposed recently in draft tariff regulations) as distribution or facilitation fee.

The regulator, which is likely to soon come out with its recommendations on interconnection framework for broadcasting TV services distributed through digital addressable systems, may also propose an additional fee for every 25 TV channels subscribed to by a consumer beyond 100 channels.

The percentage of distribution fee may be between 15-20 per cent of the total cost of TV channels subscribed by a consumer. These would form part of revenue sharing formula between broadcasters and distribution platforms and LCOs.

Who’ll pay the distribution fee and the additional cost for every 25 channels distributed beyond 100 TV channels to a consumer? It’s still not clear, but most probably the consumer. These additional costs will be exclusive of government taxes.

Few days back, TRAI had come out with draft guidelines on tariff and regulations relating to quality of services and had, in its wisdom, tried to safeguard the interest of each stakeholder for the overall development of the broadcast and cable industry, including higher ARPUs if consumers subscribed to stand-alone premium channels where no price caps were mandated.

The Telecom Regulatory Authority of India (TRAI) had issued an amended version of its Interconnection Regulations, 2004 in 2012 with an aim to keep pace with the evolving TV eco-system in India and introduction of digital addressable system (DAS). The 2012 regulations had laid down certain revenue sharing formula that envisaged the following:

--- (a) the charges collected from the subscription of channels of basic service tier, free to air channel and bouquet of free to air channels shall be shared in the ratio of 55:45 between multi-system operator and local cable operator respectively.

---(b) the charges collected from the subscription of channels or bouquet of channels or channels and bouquet of channels other than those specified under clause (a) shall be shared in the ratio of 65:35 between multi-system operator and local cable operator, respectively

Trying to update its inter-connect guidelines in 2016, the regulator is also mulling, with an aim to bring about more transparency in the system, that all agreements between broadcasters and MSOs and MSOs and LCOs should be uploaded in an encrypted format on a server that can be accessed via passwords by stakeholders.

Though this particular move has been resisted by some stakeholders, TRAI is of the opinion that such a move on data sharing could pave way for elimination of opaqueness in agreements between broadcasters and distribution platforms.

“The question that then arises is who should develop an IMS (integrated management system), which can be used by all service providers and ensure its proper functioning. It could be either an industry-led body, which operates as per the guidelines prescribed by the regulator or a private entity willing to offer such services in lieu of fee for each interconnection request, or any other option as suggested by the stakeholders,” TRAI had asked stakeholders earlier this year for feedback in its consultation paper on interconnect issues.

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