NTO 2.0: Are different lobbies & agendas hurting the broadcast industry more?

The long-held argument that the broadcast sector should not be under the Telecom Regulatory Authority of India (TRAI) is gaining even more traction now amid the scurry to comply with the TRAI-mandated new tariff order (NTO) 2.0. The broadcast sector came under TRAI’s ambit in 2004. Since then, its capability in regulating the complex broadcast industry has remained as contentious as its frequent interventions. First and foremost is the fact that the TRAI Act, ironically, does not make it mandatory for the regulatory body to have expertise on the laws relating to the broadcast sector.

TRAI has so far made more than 75 changes to the broadcasting laws, the majority being challenged by broadcasters in a court of law or tribunal. Moreover, the opacity with which TRAI’s consultation procedure is conducted has also been under the scanner. The lack of transparency in the TRAI’s consultation process was cited by the Bombay High Court in its June 2021 order in cancelling one of the provisions in its regulations. It is a far cry from the similar consultation systems prevailing in countries like Canada, where there’s a receptive and open system encompassing the entire gamut of the stakeholders.

It should be remembered that TRAI has changed its tariff orders for broadcasters about 35 times during the last 16 years. In effect, several popular channels like AXN and HBO fell victim to the revised tariff structure as they went off air after the NTO came into effect in 2020.

Broadcasters resent the regulator’s continued control over the sector

“We have been strongly opposed to TRAI’s way of regulation. The regulator has been trying to micro-manage the pricing in the broadcasting industry for a long time to the detriment of the entire industry. We called the bluff out of the TRAI. No doubt, the new pricing order will affect the Indian broadcasting industry adversely,” affirmed a top executive with a leading broadcaster on condition of anonymity.

Another broadcast executive was of the view that the Ministry of Information & Broadcasting (MIB) should have a clear understanding and clarity in policy in this regard. “The TV industry needs to be controlled. We are not saying that the industry is allowed to have a free run. That won’t be good for a democracy like ours. There is no doubt about that. Having said that, the regulatory mechanism in place should not stymie the industry from flourishing. Already, the TV medium is facing fierce competition from the streaming platforms. In such a context, it is imperative that the authorities take a holistic approach in this regard,” he added.

Arguing against the current regulatory framework of the broadcasting industry, N Chandramouli, CEO, TRA Research, a consumer insights and brand analytics company, said, “All broadcast media should be outside the purview of any regulator. If steel, cement or coffee, for that matter, have an open market in pricing and sourcing, so should broadcast. However, the government believes that the broadcast medium is very important in terms of the influence on people, and, therefore, prefers control. That said, the earlier pricing of bouquets by broadcasters was quite opaque, forcing consumers to subscribe to channels which they would never watch; so perhaps, some form of regulation could be helpful for consumers. But the current MRP shows that often regulators don’t have a full vision in their views and regulations can be circumvented, still staying within the ambit of law, if the parties so desire.”

Has the broadcasting industry been able to fight the NTO battle unitedly – is another question begging for an answer. According to the office-bearer of a broadcasting trade body, it was not because of the lack of unity that the different litigations were filed in different courts in the country. He maintained, “Five channels moved five different courts in the country. That was essentially to delay the implementation of NTO. They cannot show that they are united because of the Competition Commission. On the front they remain divided, but not at the backend. It was basically forum shopping. One full truck-load of papers was delivered to the Supreme Court. Who will have time to go through such voluminous data? The broadcasters were essentially buying time so that the implementation of NTO could be delayed.”

Strategic marketing and media consultant Chintamani Rao had this to say on the lack of broadcasters’ ability to put up a united front in fighting the TRAI in this regard. “The short answer: we are like that only. I’m not going to be very popular for saying this, but it’s in our nature. We are not given to cooperating. Each one believes they can win only at the cost of the other. You only have to see the traffic on the roads to see it in everyday life. I have been on the board of the IBF and of the NBA, of which I was one of the founders, and I have seen this play out in broadcasting. They can never come to a consensus because they don’t trust each other. If a meeting does seemingly come to a consensus they go out and violate it with impunity. And no one can point a finger at anyone else, because they are most often guilty themselves.”

On the other hand, Chandramouli had a different take on this. “Ideally, when you have more numbers in a fight, it is always better. However, there are different needs and lobbies that drive different agendas. Complete alignment for all stakeholders is the best form of opposition, but a difficult proposition in the current circumstances,” he opined.

Meanwhile, the industry stakeholders are awaiting the Supreme Court’s final verdict in this regard on November 30, 2021. Whatever be the outcome, the overriding feeling among the stakeholders is the need for an alternative to the TRAI.