New Tariff Order Might Reduce Revenue Of Broadcasters: Report

The telecom regulator TRAI has recently come up with new amendments for the broadcasters, which are expected to be implemented soon. Now, it has been reported that they believe that these rules will affect their user base and revenue in the coming days.

According to TRAI rules, broadcasters are now allowed to charge more than Rs. 12 per month for the bouquet. At present, they are charging Rs. 19. However, TRAI has recently cleared its stand and said the regulator will impose and restriction on broadcasters.

Meanwhile, the Indian Broadcasting Foundation (IBF) believes that the new amendments will reduce the number of channels, and this will automatically reduce the value of the channels. "Additionally, using regulation to limit the number of bouquets being offered to consumers is fundamentally restricting consumer choice, given the large variability in consumer preference across 200 million TV homes," IBF President NP Singh said in a statement.

Interestingly, the New Tariff Order (NTO 2.0) intimated that the broadcasters and cable TV operators will offer 100 FTA channels at Rs. 130 and 200 channels at Rs. 160. However, the broadcasters also said the main reason behind this rule is to incentivize free to air channels, which runs through ads.

"A few months back, at the request of the regulator, the major broadcasters including Sony, Star, Zee, Viacom introduced promotional schemes and offered their premier channels at an MRP of Rs. 12 for a limited period," the IBF President was quoted by IANS.

"But the results showed no uptick in the a la carte offering in spite of the price reduction, clearly highlighting the consumer's preference for bouquets. In fact, our members suffered revenue losses in this whole exercise," he added. Moreover, TRAI wants new rules to be implemented on March 1, 2020. However, operators are not ready and challenging these rules in the High Court.