Major FTA channels to pull out of DD Free Dish as hope for carriage fee waiver dims

The public broadcaster has offered relaxation on the instalments for three months.

MUMBAI: Businesses have been struggling to stay afloat since the Covid2019 pandemic has broken out in the country. A number of TV channels have since then been in dire straits as productions have paused, leading to a shortage of fresh content coupled with falling advertising revenue. While pay channels can still look at subscription revenue, free-to-air (FTA) channels are running out of options to chalk out a sustainable business model. As the appeal to waive off carriage fee for the public broadcaster-run DD Free Dish has fallen on deaf ears, the chances of FTA channels pulling out of the free DTH platform rise.

While Free Dish has been an inevitable part of FTA channels' strategy, the platform has also generated over Rs 400 crore of revenue on the back of these channels. After a good phase of increased reach post the new tariff order, FTA channels have entered a dark phase due to the pandemic. A consortium of those channels appealed to the ministry of information and broadcasting (MIB) to waive off carriage fee at least for a quarter.

Even after repeated requests, Prasar Bharati has stated that a channel can avail of deferment from the requirement of paying the carriage fee in an advance monthly statement, up to three months, subject to it furnishing separate bank guarantees towards the amount of each instalment amount with interest after availing of this deferment for three months n a letter/email dated 17 May. It has also offered to pay 67 per cent of the carriage fee for three months. But the latest notification clearly shows the pubcaster’s firm decision of not waiving off carriage fee to these troubled businesses.

FTA channels are of the view that this move will not help them in the crisis. “The expense remains the same for the channels but advertising revenue comes down at 15-20 per cent that covers only minimum expenses. It does not even cover the full salary of employees while we have decided to pay full salary to our employees. Even if the payment is deferred for three months, we don’t know from where the revenue will come. We don't want the loan but a waiver of the carriage fee. I think it won't help anyone although it depends on sustaining capacity,” Happii Digital and Broadcasting Network director Kailash Adhikari says.

“The decision of Prasar Bharati remains the same; now it's upon the broadcasters. Two to three channels are also suspended from the platform,” he adds. Asked about their plan, he says that they don’t want to withdraw currently. But he adds that if this situation prolongs, then it is a mammoth exercise for everybody in the industry.

“The new notification says they will offer deferment instead of waiver which will offer some liquidity for the short term but the main issue is after three months the burden increases. It’s small support and I think it is not going to make any material impact on the decision or business as such,” a spokesperson of a large FTA broadcaster says. He also mentions that after seeing the latest notification, it might stick to the decision of pulling out from DD Free Dish this month.

He also adds that two to three channels have already gone off. Even if some channels pay now, they can go off later after observing the situation for one month, he adds.

“This move of deferred payment and charges of interest is not something FTA channels were looking at. However, I believe the government is also under pressure to completely waive off because this was through an e-auction that was considered. Under the e-auctions and the policies, only the PMO or a minister at a higher level can take a call on this and I believe it is still unnoticed and unheard at that level,” a spokesperson from a Marathi FTA channel adds.

He notes that if advertising revenue does not fall back in proper books by the month of June, then it will become difficult for people to survive. “We are observing the situation and we believe the lockdown won’t extend beyond 31 May because it is already about 60-plus days that Maharashtra has been under lockdown. So a lot of people will try to kickstart and resume the activity as early as possible because the economy needs to be pushed,” he reflects a gleam of hope.

Notably, Swami Films Entertainment Pvt Ltd which runs two FTA channels on DD Free Dish moved the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) against Prasar Bharati for interim relief against disconnection of the channel from its DTH platform. The state broadcaster offered two more alternatives to the broadcaster. The tribunal noted that it was a fair stand with more alternatives being offered to the broadcaster.

Swami Films requested for some more time to consider the alternative reliefs as a final solution and even as an interim arrangement. TDSAT did not pass any interim order till the next date of hearing. 

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