Regulators
Report on Hindi News Viewership

Twin conditions ensure broadcasters do not engage in ‘perverse’ pricing: TRAI

Duty bound to tackle issues arising out of bouquet pricing, said the regulator.

https://www.indiantelevision.com/sites/default/files/styles/smartcrop_800x800/public/images/tv-images/2021/09/06/photogrid_plus_1630926654616.jpg?itok=HJ1ih8TQ

Mumbai: The twin conditions introduced in the New Tariff Order (NTO) 2.0 seek to ensure that broadcasters do not engage in “perverse pricing”; that consumers do not get a raw deal; and that choices offered by and to all market participants remain real. Both conditions are important in their own ways, observed Telecom Regulatory Authority of India (TRAI).

The regulator made these statements in its counter-affidavit submitted to the Supreme Court quashing the writ petitions by the Indian Broadcasting Foundation (IBF) and other broadcasters to halt the implementation of NTO 2.0.

The twin conditions introduced in the NTO 2.0 seek to discourage unfair bundling, stated TRAI. The first condition prescribes that the aggregate a-la-carte (MRP) prices of channels in a bouquet must not be more than 1.5 times the bouquet price, hereafter referred to as the “Aggregate Test”. So, if a bouquet has five channels A, B, C, D, and E (with their individual a-la-carte) and a bouquet price of X, the total/aggregate of A+B+C+D+E should not be more than 1.5 times X.

The second condition, which alone has been struck down by the Bombay high court judgement, states that the MRP of any individual channel in a bouquet, i.e., its a-la-carte price, should not exceed three times the average MRP of a pay channel in that bouquet, hereafter referred to as the “Average Test”.

TRAI alleges that broadcasters want to maximize their advertising revenue and hence are bundling their popular channels along with less popular channels to claim higher subscription and advertising revenues. The high-demand channels that do not need to be pushed, henceforth called driver channels, are bundled with those channels in which consumers otherwise have no interest.

“In a large number of cases bouquet prices are the same as the a-la-carte price of the driver/popular channel. In many cases, the bouquet price artificially has reached such perversity that the bouquet price is cheaper than the driver channel in it,” observed TRAI.

This perverse pricing compels the consumer to pick a bouquet over a-la-carte channel not by choice but out of compulsion, it alleged. 

In a prior hearing, SC expressed three concerns with NTO 2.0 order: a) Whether the "Average Test" in the twin conditions formed a part of the pre-consultation process b) Are broadcasters and DPOs being treated equally c) Is "Average Test” severable from “Aggregate Test”.

Referring to a) TRAI responded, “Both twin conditions were fully deliberated on prior to making of the 2020 framework. There is ample correspondence between TRAI and the broadcasters concerning the implementation of the twin conditions. Even the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) has found broadcasters to be in violation of such twin conditions prescribed by TRAI in the past, and held that all reference interconnect offers had to be in consonance with those conditions.”

TRAI denied discriminating between broadcasters and DPOs stating that there are exhaustive notes on the subject matter that point to the contrary.

Referring to c) TRAI responded, “The 2020 framework seeks to address two major issues arising out of the formation of the bouquet by broadcasters. The first concerned heavy discounting of bouquet prices, and the second related to ‘pushing’ of unwanted channels to consumers.”

“TRAI is duty-bound to resolve both issues, in order to safeguard the interest of all service providers and consumers,” it said. 

The next hearing will be held on Tuesday 7 September.

Latest Reads

https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2022/05/20/anub.jpg?itok=eLLAJvAF
I&B Minister Anurag Thakur expects Indian M&E sector to double by 2030

Indian media and entertainment sector, which is currently valued at $24 billion is expected to grow to $30 billion by 2024. “I feel with the growth rate we have and I’m sure it’s going to grow more than that. By 2030 we expect it to double and even more,”

Regulators I&B Ministry
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2022/02/14/5g.jpg?itok=0WfZabkc
5G auctions likely in May

5G spectrum auction in India is expected to be held in May this year subject to the Telecom Regulatory Authority of India (Trai) submitting its final recommendations on various aspects of the sale process by March, said a senior official of the telecom department.

Regulators TRAI
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2022/02/02/nir.jpg?itok=ZRddz1a9
Budget 2022: I&B ministry allocation slashed to Rs 3980.77 crore in FY23

The Union Budget 2022 has earmarked a total sum of Rs 3980.77 crore for the ministry of information and broadcasting in the fiscal year 2022-23. This amounts to a decrease of Rs 90 crore from last year.

Regulators I&B Ministry
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2022/01/04/img_04012022_180809_800_x_800_pixel.jpg?itok=EpLXIgFD
I&B ministry lays down guidelines for infrastructure sharing by MSOs

Mumbai: The ministry of information and broadcasting (I&B) has given its go-ahead to the multi-system operators (MSOs) to share infrastructure with other MSOs on a voluntary basis. As per the guidelines released by the ministry, the responsibility for compliance with guidelines and other...

Regulators I&B Ministry
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2021/12/30/trai.jpg?itok=xcyRdhfO
Trai to form committee for smooth rollout of NTO 2.0

The Telecom Regulatory Authority of India (Trai) has decided to form a committee with representation from leading pay TV industry associations to ensure the smooth implementation of the New Regulatory Framework 2020 and identify impediments with counter-measures for the overall growth of the...

Regulators TRAI
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2021/12/09/img_09122021_134949_800_x_800_pixel.png?itok=ST7NBDS2
Trai asks broadcasters, DPOs to comply with interconnection agreements regulations

Mumbai: The Telecom Regulatory Authority of India (Trai) has asked broadcasters and distributors of TV channels to immediately implement the provisions of the Telecommunication (Broadcasting and Cable) Services Register of Interconnection Agreements and all such other matters Regulations, 2019. The...

Regulators TRAI
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2021/12/09/trai.jpg?itok=DTj5E0mY
Trai seeks suggestions to enhance ease of doing business in telecom and broadcasting sector

The Telecom Regulatory Authority of India (Trai) has released a consultation paper on “Ease of Doing Business in Telecom and Broadcasting Sector”. The industry stakeholders can send their comments by 5 January 2022, and counter comments can be submitted by 19 January 2022.

Regulators TRAI
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2021/12/07/img_07122021_165749_800_x_800_pixel.jpg?itok=XN5GtFzF
Prasar Bharati not closing any Akashvani radio station in India: Anurag Thakur

Mumbai: Prasar Bharati is not closing any Akashvani radio station in India, the minister of information and broadcasting Anurag Thakur told the Parliament on Tuesday. Thakur was responding to concerns regarding the closure of radio stations across different parts of the country that have been in...

Regulators I&B Ministry
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2021/11/30/coirt.jpg?itok=ELGjuKf8
Supreme Court to hold final hearing in NTO 2.0 case today

The Supreme Court is all set to hold the final hearing in the NTO 2.0 case on Tuesday. The matter pertains to a bunch of petitions filed against the Bombay high court order regarding the implementation of the New Tariff Order (NTO) 2.0 issued by the telecom regulator.

Regulators Supreme Court