It appears that while the Ministry of Communication and IT has been busy deciding on auctioning spectrum, the Ministry of Information and Broadcasting has been keeping itself busy with some changes in the television sector.
Here are a few samples:
The Ministry of Information and Broadcasting has amended the Cable TV Networks (Regulation) Act 1995, with a set of new Rules in 2012. The following are the significant implications:
- Multi-System Operator has now been defined, and it is a large enough definition to subsume cable operators (who are registered under rule 11C)
- Rule 5 of the old Act has been complemented with the new Rules, especially Rule 5B – which is deemed registration for transmission in encrypted in certain areas.
- As per Rule 11 A, to register as a MSO, the processing fee is Rs. One Lakh (Rs. 1,00,000/-).
- The new Rule 13 says that a customer will be free to buy a STB from the open market. Also if the subscriber will be allowed to surrender his STB and if he’s got it from the MSO, then he will be given full refund of the security deposit, and the MSO will buy back the STB after making due deductions based on the condition in which it is received.
A copy of the Digital Addressable System (DAS) Rules can be found here (pdf)
Our analysis:
The move towards digitization bodes well for broadcasters who cannot find space on the 100 odd channels that analogue cable can host. However, to make it mandatory is a bit premature, since
1) There is no real diversity and media pluralism in the available TV channels as of now. They all dish out the same Bollywood songs, cricket and sensationalised news. Shouldn’t we first address these issues before we start batting for content over distribution?
2) Even if we assume that the content is great on all 600+ channels, why make it mandatory? If a subscriber cannot afford STBs, then cable is the cheaper option, and he or she should be allowed to receive television as they deem fit.
3) Let us first clear the regulatory mess on the whole back-end of digitization. Who is footing the bill for the STB? Let us first develop manufacturing capabilities of indigenous open standard STBs, and in the meanwhile, reduce import duties on STBs to zero.
4) Cable allows for localized video production and distribution. Please remember that full addressability will kill localized video and allow govts and service providers to track every single minute of viewing.
Further, the the Ministry has also put up a press release (PIB Release 11), dated 11th December 2012, where it has sought TRAI’s opinions on entry of the State or Central government into the broadcasting sector. It may be worth noting that TRAI has already recommended in 2008, that State government and their organs should NOT be permitted to enter into broadcasting and distribution activities. The press release can be found here (PDF).
Initially, there was some noise about state governments getting into broadcasting. The most noticeable was, and is the Arasu Network, started by Karunanidhi and now is owned by the state of TN. The Maran brothers have anyway got their fingers deep into the broadcasting pie, not to mention telecom. Then everyone got into the act – the Gowdas in Karnataka, Reddys in AP, Modi in Gujarat, Didi in West Bengal, and so on. Now that everyone else threatens to get into the act, it is high time that governments concentrate on governance and not propaganda on TV – be it State government or Centra government. Further, this press release has touched upon an important topic – where should government draw the line in terms of broadcasting?
- Please stop funding Prasar Bharti directly from MoIB funds, and also stop having the chief of PB politically appointed. It is supposed to be an autonomous body.
- The government has no business deciding the price of spectrum or licenses and then collecting the money itself. Either the money should be collected by someone else, or the allocation (including method of allocation) should be done by someone else. It will only lead to more scams and at the very least – a blatant conflict of interest. We recommend that the latter be handed over to TRAI, just like how the FCC and Ofcom handle it in the U.S and U.K respectively. The Supreme Court had recommended this way back in 1995, deciding on CAB Vs MoIB, but clearly no one’s listening.
- If State governments cannot get into broadcasting, then please stop giving community radio licenses to State Agricultural Universities. They are NOT community radio by any stretch of imagination.
Lastly, the Ministry of I & B has also sought TRAI’s opinion on preventing MSO and LCO monopolies. They note that at present there are no restrictions on the issue of accumulation of interest in terms of market share. More details on this available at Medianama.
Well, of course this is a very good thought on the part of the Ministry, but the timing is a bit suspect. We’ve seen instances of violence and damage of infrastructure when MSO and LCO monopolies are threatened. But shouldn’t we also take a look at companies like Reliance and Bharti who have been openly monopolizing the media sector end to end. Vertical Integration is dangerous and has been identified as a bad practice even by TRAI. Yet successive governments have done nothing to check it. The government should go ahead with preventing monopolies of not only the LCOs and MSOs but also other players in the broadcasting sector. Let the Ministry act on the Media Ownership Recommendations made by TRAI in 2008-09, and then no doubt, go ahead and implement the same on MSOs and LCOs.