Trai against cross-media restrictions

Font Size

Print

Feedback

Email

Discuss

New Delhi: In a development that will bring relief to the media houses like the Bennett, Coleman and Co Ltd (BCCL), HT Media Ltd, Living Media group, the Telecom Regulatory Authority of India (Trai) is planning against posing any restriction on media cross-holding in the country.

The broadcast regulator is of the view that in countries where such media ownership restrictions exist, the print and electronic media have already evolved while in India the electronic media space in particular, is in relatively early satges and is still evolving. “One has seen television and print media draw synergies both for news content and derive economies of scale that makes television entertainment in the country affordable to the consumer,” said a Trai official.

The final recommendations are expected shortly. The print players sense a sound logic for established newspaper enterprises to diversify in the electronic media to insulate it from the financial risk of dealing with the excessive volatility in the market of newsprint. The broadcasters in the country claim that they command one of the lowest average revenue per user at $4 compared to $40 in USA and Indonesia and $20 in Singapore enabling viewers to access TV content at such low price points.

Media houses argue that media businesses require huge capital investments and have long gestation periods ranging upto 10 years or more and imposing cross-holding limits at this stage will retard the growth of the media industry, and affect the efficiency of the media businesses. “If such provisions (cross holding restrictions) were to be introduced, this would require a complete restructuring of India’s broadcasting industry, leading to a loss in revenue, downsizing and affecting the current and future economic potential and employment capacity of the industry,” according to the Indian Broadcasting Foundation.

“Cross-media restrictions inherently work against convergence and economies of scale. Convergence of media, a global phenomenon is taking place very rapidly. Any regulations restricting use of content assets to any specific medium will deny the technological and commercial advantages of convergence,” a broadcaster said. He added that multimedia ownership and operations provide media enterprises significant advantages in terms of amortising the cost of content, distribution and manpower over a larger volume of revenue. Any kind of restrictions may prove to be counter productive, anti-growth, anti -investment from a long-term perspective. Vertical and horizontal expansion of converged media has attracted investment into under-invested areas without in anyway creating anticompetitive barriers, he added.