After cable operators decided to comply with the new tariff order on the TV channel prices, broadcasters such as Disney Star, Sony Pictures, and Zee Entertainment on Friday restored their channel signals for nearly 45 million consumers who were affected for nearly a week.
The channel owners and distributors reached an agreement taking into consideration the loss of subscribers and revenues in the absence of major channel broadcasts, people aware of the matter said.
Multiple system operators (MSOs) such as Reliance Industries-owned Hathway Cable, GTPL Hathway
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According to broadcasters, tariffs have not been hiked in five years, and this 10-15% hike is required for smooth operation of the industry .
“We did not have any option but to comply with the tariff hike as at the end of the day the blackout of channels was affecting the business,” said an executive of an MSO.
Another reason cited by smaller MSOs for complying with the hike was loss of consumers to Jio (on its OTT platforms) and DTH (direct-to-home) players like Dish TV and Tata Play.
“We have evaluated the market situation very seriously and are constrained to take a decision to move ahead and sign the RIO (reference interconnect offer) agreement with broadcasters. Moreover, Jio and DTH platforms are exploiting this crisis and adopting new strategies to capture our valuable customers,” the Kerala Communicators Cable said in a letter to All India Digital Cable Federation (AIDCF).
The compliance was also crucial ahead of the Indian Premier League
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Without the tariff hike, Disney Star, which is already facing the heat from JioCinema’s plan to stream IPL for free, would have witnessed more dilution in advertising revenues, experts said.
The Kerala high court is currently hearing the case filed by AIDCF against Trai’s new tariff order. The court on Friday asked AIDCF to file its response by March 3.
In November, the Telecom Regulatory Authority of India (Trai) restored the maximum retail price of a TV channel part of a bouquet to Rs 19 from Rs 12 earlier. This raises television channel prices in the bouquet 10-15%, whereas the hike was steeper for some individual channels outside the bouquet.