Cable TV

GTPL Hathway believes NTO 2.0 won't affect price stability

It is of the view that NTO 2.0 is an extension of NTO1.0

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MUMBAI: At the very beginning of 2020, the Telecom Regulatory Authority of India (TRAI) issued fresh amendments to the New Tariff Order (NTO) within less than one year of its implementation. Rattled by the sudden change, the stakeholders in the industry seem to be displeased. But in contrast, GTPL Hathway believes NTO 2.0 is an extension of NTO 1.0 and price stability in the market will continue despite the revision.

“There is NCF for Rs 160 in the new NTO and there is NCF Rs 130 in the earlier NTO plus we could charge additional Rs 20 for every additional 25 channels, so broadly speaking, from a short-term perspective, they are more or less similar kind of thing. So, NCF has a big portion of earning. That is something which is more or less protected while one can debate on what kind of future impact it will have after three years, after five years, but from a short-term perspective that is protected,” GTPL Hathway chairman and non-executive director  Rajan Gupta said in an earnings call after q3 result.

“In fact, we have the ability to charge Rs 30 more in case market forces allow us to charge and GTPL being high market share in many territories, they should have the ability to charge higher and we are happy about the consumer. I think consumers will have more choices,” he added.

According to Gupta, DPOs with higher market share should be able to make many more relevant bouquets for consumers, for example, genre-level bouquet while currently bouquets are limited to five-six, which is more based on the ARPU slabs.  He said having very micro bouquets is also needed.  He stated that can happen with NTO 2.0 on the back of flexibility it offers for DPOs.

Although he mentioned this is not a full assessment on NTO 2.0 but the MSO believes on the basis of the initial assessment that it should see a lot of stability in earnings and cash flow.

“It is too early to speak about how the ARPU will happen in NTO 2.0. In NTO 1.0, if you see this quarter, our ARPU has stood at around Rs 118 and we are expecting that it will go up in q4. We have gone down by Re 1- Rs 1.5 because of the festive offer given by the broadcasters. We are expecting that in q4, it will go up as the festive offer is over. Right now, we have to wait to see what new bouquets, new channel prices come from the broadcasters in NTO 2.0 and only after the assessment, we can comment on NTO 2.0 ARPU,” GTPL Hathway  Cable TV business head and chief strategy officer Piyush Pankaj said.

He also added that it is not certain right now if less money will be coming from customers because it depends on what type of bouquets and a-la-carte price the broadcasters will come through. But he said there is price stability in the market during the last one year and they believe price stability would continue.

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