The Telecom Regulatory Authority of India (TRAI) might have notified the rollout of its new television tariff system from February 1, but with a significant portion of TV subscribers yet to migrate to the new regime and some service providers protesting revenue sharing norms, things are far from done yet.
While a series of cases are currently underway in several courts examining revenue sharing mechanisms and already existing deals between stakeholders, consumers are likely to face several of their own issues during the transition period.
For instance, while the regulator TRAI has made it clear that there is to be no disruption of services to customers who have prepaid plans and existing prepaid balances, this might not mean that they will continue getting paid channels as per their earlier plans, sources tell this publication.
“The problem for prepaid customers is that while TRAI has directed that there should be no disruption of services for consumers with prepaid balances, broadcasters are planning to begin billing under the new system by February 15 or 16. This means that service providers (Cable/DTH operators) will be stuck trying to fix a square peg in a round hole,” an industry source said.
What is likely to happen instead, say people in the know, is that those customers with prepaid balance will be shifted to the basic service tier once broadcasters begin billing as per the new system.
“They will then let the prepaid balance run out on this plan, unless the customer migrates,” the source said.Analysts note that this is an extremely likely scenario that most service providers will choose to follow, since they will not be able to provide customers plans at their old rates once broadcasters begin billing them at new (and often higher) rates next week. “They will not disrupt or blackout connections, as TRAI has instructed them to. But, shifting customers with existing balance to basic service tiers is being considered,” a Karnataka-based cable operator said.
TRAI, for its part, has been insistent that no disruptions to services arise for consumers. In a statement last week, it said, “In cases where subscribers are availing prepaid service, no disruption of service will be caused, if there is a credit balance available in the subscriber’s wallet/account. The Authority has issued explicit direction to all service providers to ensure there are no interruptions. However, the Authority received information that while migrating consumers, one large service provider has caused blackout on the TV screen of a few thousand subscribers. The Authority has issued show cause notice to that service provider.”
Agencies reported that TRAI has served a showcause notice to Airtel over the blackout faced by some of its DTH customers during the switch-over to the new tariff regime.
Advertisers’ body asks members not to use BARC data for 6 weeks
With a furious debate raging on the reliability of viewership data in the transition period to the new tariff system, the Indian Society of Advertisers (ISA) has advised its members not to use viewership data from the Broadcast Audience Research Council of India (BARC) for media planning and buying purposes for a period of six weeks. BARC is the agency which brings out weekly television ratings, the primary metric on which advertisement rates are fixed and negotiated in the country’s television sector. According to sources, the advisory to its members says that the ISA executive council and core media committee have been in touch with BARC on the issue of the new tariff order. “Its impact will be significantly different in each region given the varied distribution and broadcast landscape of each region. The New Tariff Order, if implemented in true spirit, is likely to have shift in channel availability and hence, possibly consumption landscape also,” the ISA warned. It went on to advise that viewership data during the transition period of around six weeks should not be used for media planning, evaluation, or buying. It also added that the ISA will work closely with BARC to ascertain when the data will become usable again.
TV bills will fall, says TRAI
Telecom Regulatory Authority of India (TRAI) has stressed that the new tariff system would not result in an increase in TV bills for the average subscriber, as Crisil claimed in a report recently. According to TRAI, this report had been prepared with “an inadequate understanding of the TV distribution market”. It went on to note that while these were early days for the system and detailed data-sets will be available only after a few weeks, it had information from a few large operators.
10-15% will be the actual savings by subscribers in metro cities if the new TV tariffs are implemented according to preliminary data analysis
5-10% savings for those in non-metro areas