The broadcast industry is just one day away from the deadline for the implementation of the Telecom Regulatory Authority of India's (TRAI) new tariff order (NTO) 3.0. However, speculations are rife that the order may not see the light of the day yet as a case against it is pending before the Kerala High Court which will be heard on February 8. The case was filed by the All India Digital Cable Federation (AIDCF) in the first week of January, requesting the court to stay the implementation of the order. However, the court declined to issue an interim order and instead scheduled the case for February 8.

"NTO 3.0 is unlikely to get implemented on the ground since the matter is sub-judice. The Kerala High Court has not granted a stay, but it will hear the case on February 8," a cable operator said.

A senior executive of a leading broadcaster too shared the same thought. "All broadcasters have revised their pricing and submitted RIOs but most of the DPOs haven’t. Though there has been no announcement from TRAI on whether NTO 3.0 will be implemented on February 1 or not, we believe it is unlikely to be implemented because of the AIDCF petition in the court," he said.

The amended new tariff order was issued by TRAI in November last year. The NTO 3.0 reinstated the Rs 19 MRP cap for TV channel inclusion in a bouquet and also allowed broadcasters to offer a maximum discount of 45% when pricing its bouquet of pay channels over the sum of the MRPs of all pay channels in that bouquet.

While broadcasters have welcomed the amended NTO, distribution platform operators (DPOs) have expressed concerns. Cable operators believe that NTO 3.0 will drive customers away from pay TV towards DD FreeDish and over-the-top (OTT) platforms.

In its petition, AIDCF has requested the court to issue directions to TRAI to examine the new order and fix maximum retail price for television channels genre-wise and place a maximum cap on the price of any channel in order to ensure the orderly growth of the digital cable television sector as mandated by the TRAI Act, 1997. The federation had told the court that TRAI has failed to consider and address the foremost challenge faced by the entire broadcasting and cable services industry and that they are witnessing constant decline in subscriber base for MSOs and DTH operators.

Meanwhile, following the amendment of the NTO, broadcasters such as ZEEL, Sun TV, Discovery Communication India, Disney Star India, Viacom18 and Culver Max Entertainment revised their pricing in December last year and filed their RIOs. DPOs, however, are waiting for the Kerala High Court’s decision and are yet to publish the new pricing. According to industry sources, most of the DTH operators will be publishing new pricing before February 1, 2023.

TRAI’s data shows that in the last eight quarters, the total active number of DTH subscribers has decreased from 70.99 million to 68.89 million. Similarly, the number of total active subscribers of major MSOs/HITS operators, having more than a million subscribers, has decreased from 47.58 million to 45.55 million.

Not just AIDCF but several other local cable operators too have raised similar concerns over the implementation of NTO 3.0.

In a letter to TRAI Secretary V Raghunandan, Kolkata- based LCO RK Communication has said that they are facing serious problems since digitization and despite repeated correspondence with TRAI they are yet to receive any solution from their end.

“We are strongly demanding the withdrawal of the NTO 3 implementation during this time of economic recession period. NTO 1 was not at all a success. When NTO 1 was launched, we lost 30%- 40% of our customers. We are scared that if NTO 3 is launched, the same thing will happen. So, our demand is to first resolve the issues related to our business,” the LCO said in its letter.

They requested that a regulation for OTT platforms must be framed and a level playing field should be ensured. The LCO also mentioned that live channels on OTT platforms should be withdrawn immediately. RK Communication also demanded that a licence fees for OTT platforms should be implemented from immediate effect.

It further asked for a new policy for pay channels sharing percentage. “We demand 50% commission for LCOs on every pay channel.”

“We also demand that no pay channel should be aired on DD FreeDish and on terrestrial. Our demand is first to resolve the issues of the cable operators with a proper discussion over the table regarding NTO-3,” their letter read further.

A similar letter was written to MIB Minister Anurag Singh Thakur by Fibernet Operators Federation.

"Cable operators are concerned that this (NTO 3.0) will have a negative impact on their subscriber base and end customers," said an industry expert.

“Because the price difference between OTT and TV is still very large, a price increase of 8-10% will have no effect on TV. Although NTO implementation on February 1 appears unlikely, NTO 3.0 will go into effect," he added.

The All Local Cable Operator Association Delhi (ALCOA INDIA), which is a representative body of Local Cable Operators (LCOs), also wrote another letter to Anurag Singh Thakur on January 30. In the letter, they said that implementation of NTO 3.0 will result in shutting down of Cable TV business leading to loss of approximately 1 million jobs.

They have requested Thakur to stop implementation of NTO 3 in its current form and to relook into its provisions. They have also requested to put a cap on all the channel prices for the overall benefit of the subscribers along with other demands.