MUMBAI: The All India Digital Cable Federation (AIDCF) is on a roll. The multi system operator (MSO) association, which first submitted its recommendations to the Information & Broadcasting (I&B) Ministry and then to the GST Committee, has now written to broadcasters with Over the Top (OTT) platforms.
The Association has written a letter to Star India, Multi Screen Media and IndiaCast Media Distribution. In the letter, AIDCF has stressed on how the broadcaster is giving content free of cost to its OTT platforms, while charging MSOs for the same content.
Giving an example of Star India’s OTT platform hotstar, a source close to the development tells Indiantelevision.com, “Star India, on one hand offers simulcast or immediate transmission of fresh popular content completely free of cost to its OTT subscribers on hotstar and on the flip-side, it charges the MSOs huge sum for the same set of content.”
AIDCF’s letter to broadcasters, a copy of which is with this website, reads:
1) The cable industry is contributing huge subscription revenue to
broadcasters for the same set of content and programme.
2) It contributes to a large viewership for the channels the network has.
3) Also helps the broadcaster in gaining higher TRPs, which in turn leads to a better ad rate for the portfolio of channels thus increasing the advertisement revenue.
The letter points out that this scenario of offering simulcast/immediate transmission of fresh content completely free of cost to OTT subscribers is not favourable for the Cable TV industry and its relationship with broadcasters, considering the growth in the subscriber base for the broadcasters’ OTT application.
According to AIDCF, this is a threat to the pay TV cable business model, which defeats the purpose of paying huge license fees to broadcasters. “Some of our subscribers have started complaining saying, ‘Why should we pay you for the content, which is available free of cost via say hotstar or Sony Liv,’” informs the source.
Giving free of cost content to OTT platforms is affecting the average revenue per user (ARPU) of the cable TV industry, subsequently hampering the growth of business at large.
AIDCF in its letter has asked broadcasters to create a level playing field amongst respective distribution platforms. “We have requested the broadcaster to make content available on their OTT platform a paid service with a subscription fees. Alternatively, the same content should also be made available free of cost to other distribution platform,” the source reaffirms.