New norms for DTH television distribution sector

Synopsis:  The reasons why a revised scheme for the Direct-to-Home (DTH) television distribution sector has been brought in. 

Background 

• Recently, the Union Cabinet has approved a revised scheme for the Direct-to-Home (DTH) television distribution sector which were in due for last 6 years after the TRAI gave its recommendation to reduce the license fee. 
• Under the new norms, 

• 100% FDI in Direct-to-Home (DTH) television distribution sector has been allowed. 
• The licence period has been extended to 20 years from the present 10.  
• The license fee has been reduced to 8% of Adjusted Gross Revenue, as opposed to 10% on Gross Revenue now.  

What is the need for Direct-to-Home? 

• Firstly, The Direct-to-Home (DTH) television distribution sector has been impacted by technological change like high bandwidth Internet and Over the Top (OTT) channels. 

• Second, some DTH operators are under pressure as few big DTH players have made their presence on Internet service and OTT as well. 
• Third, Fee reduction will address the concerns of petitioners filing the case in SC against high fees which is yet to get hearing. 
• Fourth, as per the operators, the amended New Tariff Order (NTO) by TRAI has made them mere carriers of channels, with taking away the pricing power. Thus, high fee is not feasible. 

What is the way forward? 

• India with an estimated 200 million cable and satellite households serves as one of the biggest single markets for audiences. Any regulation should serve the consumer rather than the businesses. 
• The broadcasters must realise that only authentic programming and entertainment along with best combination of technology and pricing can attract viewers.