Latest on TRAI Tariff Order: Miffed with Uday Shankar's statements on NCF, cable operators write to IBF

The TRAI amendment directs broadcasters and distributors to submit the revised channel prices by January 15, 2020, and January 30, 2020, respectively, with full implementation from March 1, 2020.

On January 1, 2020, The Telecom Regulatory Authority of India (TRAI) issued fresh amendments to the New Tariff Order (NTO) which it had implemented nine months ago, in February 2019. TRAI said the amendments are to "protect consumer interests". However, the amendments served to irk the broadcasters who said the frequent changes in tariff would directly affect their business. The Indian Broadcasting Foundation (IBF), an industry body that represents the broadcasting fraternity, held a press conference in Mumbai and shared its views on the new amendments.

While speaking at the press conference, Uday Shankar, president of The Walt Disney Company Asia Pacific, and chairman of Star India and The Walt Disney Company India, said, "If the regulator is so concerned with bringing down the price for the consumer then why, in the name of an NCF, are cable operators, distributors being allowed to charge as much as Rs160 for something the Freedish is giving for free? The contradiction is ludicrous."

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While responding to a question, he reiterated, "The real reason why the prices have gone up after NTO was this NCF of Rs 130. Suddenly the regulator allowed DPOs a possibility to make money from channels that were meant to be available for free, and content that was meant to be available for free. The cable subscription rate which should have been zero as in the case of Freedish, went up to Rs 130 because of the NCF."

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NCF (Network Capacity Fee) is the minimum amount that one needs to pay to have a Cable TV connection at home. In return the consumer gets to choose from 100 free to air channels. TRAI defines NCF as, "like a rental charge of the TV connection to your home. This rental includes the carriage of 100 TV channels."

Maharashtra Cable TV Operators Foundation (MCOF) was the first one to issue a statement responding to Shankar's jibe at the NCF. MCOF president Arvind Prabhoo countered Shankar's argument and said, "After listening to Uday Shankar, few thoughts came to my mind... Does he think that free to air channels should be given to a Cable TV subscriber for no charge? Just because FTA channels are available on DD Freedish LMOs (Last-Mile Operators) should not charge? By that logic, pay channels should also be free because they are available on OTTs for free. I request all LMOs to voluntarily ban Star TV pay channels."

Posted by Maharashtra Cable OperatorsFoundation on Wednesday, January 15, 2020

Not only the MCOF, the Cable Operators' Welfare Association has also written to the Indian Broadcasting Foundation's president, NP Singh expressing its regrets on Uday Shankar's statement, on Friday. "This is perhaps a rare industry where a major stakeholder blames its distributors whenever things do not go their way. Once commercial terms are achieved, things go back to normal," reads COWA's letter to Singh.

Also Read: What do cable operators make of TRAI's tariff order?

It adds, "Uday Shankar has gone on to explain that post NTO, rates have solely gone up because the Regulator has permitted an NCF of Rs 130 for carrying free channels which are given at zero cost on Freedish. It seems ridiculous that a person who heads India’s leading broadcaster should talk like this and surmise that there is zero cost of distributing channels."

The letter concluded, "We are more than ready to sit with you and work together rather than taking pot shots at each other. We would welcome if your teams work more closely with us as we constitute 98- 99 per cent of any MSO's reach and we are the ones implementing things and interacting with consumers. We are open to discuss all means by which we can reduce NCF on a mutual basis as long as you can find ways to ensure that our revenues are protected. This game of blaming stakeholders has to come to an end some day."