TRAI may cap DTH channel prices

By SiliconIndia   |   Friday, 28 March 2008, 14:01 Hrs
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New Delhi: The Telecom Regulatory Authority of India (TRAI) may fix prices of pay channels on the direct-to-home (DTH) platform in line with the Rs 5 per channel cap on conditional access system (CAS) services in Delhi, Mumbai and Kolkata, reported Business Standards.

A meeting between pay-channel broadcasters and TRAI is scheduled for March 28. Though the move will lower fees, it will hit the income of broadcasters from DTH companies. A major beneficiary may be new DTH entrants like Big TV (Reliance ADA Group), Bharti, Sun Direct and Videocon as their cost of content will come down.

However, for the two existing DTH companies, Dish TV and Tata Sky, the current rates will continue as content contracts are generally for three to five years.

Currently, pay channel broadcasters like ESPN, Star India, Zee Group and Sun Network are charging 55-115 percent more per subscriber for giving content for DTH services than for cable TV homes outside CAS areas. There are about 76 million cable homes in the country and around 5 million DTH subscribers.

TRAI's formula for pricing content on the DTH platform entails that all pay channel broadcasters should charge DTH operators up to 50 per cent of the bouquet price they charge cable operators in non-CAS areas (about 70 million cable homes).

"TRAI has told us to lower our DTH price in line with its formula, else it may bring out a tariff order mandating bouquet pricing," said a senior executive of a leading broadcasting house.

But sources said certain niche broadcasters with a handful of pay channels in their bouquet were opposing the move on grounds of higher cost of content acquisition and might move court in case TRAI tried to regulate prices on the DTH platform.

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