Regulators

TRAI’s lifeline for content aggregators

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The Telecom Regulatory Authority of India’s  latest notification of regulations for content aggregators has attempted to curb their muscling power, even as it has allowed them to continue as agents carrying out the same function.

TRAI on Monday notified amendments to its regulations barring content aggregators from bundling of channels belonging to different broadcaster groups and mandated broadcasters to themselves sign Reference Interconnect Offers (RIOs) with Distribution Platform Operators (DPOs). The broadcasters have, however, been allowed to appoint authorised agents to market their bouquets, which could be the existing aggregators.

The amended regulations change the status of content aggregators from entities that aggregated television channels and marketed them in bundled packages to television distribution platforms to that of agents of broadcasters.

But the role of content aggregators may not change radically. Content aggregators as agents of broadcasters might still be able to perpetuate their dominance, though in a slightly diluted form.

The concerns flagged by TRAI vis-?-vis the business of content aggregation were:

a. Top three content aggregators – MediaPro Enterprise India, IndiaCast UTV Media Distribution, MSM Discovery – controlled 58.6% of the total pay TV market.

b. Content aggregators forced all-channel bouquets on the DPOs, validated by the fact that even though the largest bouquets offered by the aggregators in their RIOs are in the range of 13 to 20 channels, the agreements entered into are for a package of channels consisting of almost all the channels they are authorised to distribute.

c. Content aggregators grossly discriminated against independent DPOs, charging 62 per cent to 85% more than DPOs which are established by broadcasting groups.

The outcome of the amendments to the TRAI regulations could be the following:

a. End of the era of clout wherein aggregators used to bundle channels of various broadcaster groups into  package cluster and thrust them down the DPOs throats.

b. Making it obligatory for broadcasters to publish RIOs will result in relative transparency of pricing of channels.

c. The margin of discrimination against independent DPOs may substantially get narrowed.

d. The existence of content aggregators gets erased from the regulatory point of view. The regulations make the broadcasters responsible for the actions of content aggregators, now described as authorised agents of broadcasters.

The issues the amendments have not addressed:

a. By allowing channels from broadcasters within a corporate group to be packaged, the TRAI has allowed weak channels to piggyback on highly dominant  and popular channels. This could lead to problem and conflict in future when these networks swell as they add more and channels.

b. Agents have been allowed to sell channels of different broadcaster groups though as separate bouquets. This does not completely eliminate the bargaining power of agents. They can bargain with DPOs for weak bouquets in exchange for a supposedly more favourable deal on dominant bouquets.

c. Though TRAI made a mention of the undue advantage enjoyed by content aggregators owned by broadcasters, it stopped short of clamping down on the cross-holding norms for them, meaning it has continued to allow different broadcast networks to own a distribution agent.

d. Independent DPOs will still be discriminated against, though the scale of bias against them is expected to significantly narrow.

The amended regulations may have shaken up content aggregators. For the past six months, executives working in these companies were filled with trepidation that they would be forced to shut down their operations. But by allowing them to continue as agents, the TRAI has offered them a lifeline.

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