The deadline for adoption of the revised new tariff order (NTO 2.0) for TV channel distributors has been extended till June 1, 2022, the Telecom Regulatory Authority of India (TRAI) said on February 3.
The last date for the adoption of the new tariff regime was earlier fixed as April 1, 2022. The same has been extended by a two-month period after receiving several requests from the stakeholders, TRAI said.
“All distributors of television channels shall ensure that with effect from June 1, 2022, services to the subscribers are provided as per the bouquets or channels opted by the subscribers,” it said in a letter to the broadcasters and distribution platform operators (DPOs).
The regulatory body said it decided to push NTO 2.0's implementation after the stakeholders cited the prevailing COVID-19 situation which has affected their operations.
“Keeping in view the current pandemic situation across the country and requests received from stakeholders for extension of time for implementation of New Regulatory Framework 2020, TRAI decided to extend the time limit for implementation of New Regulatory Framework 2020," it said.
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NTO 2.0 is, notably, a revision of the erstwhile new tariff order (NTO 1.0) that was issued in January 2019. Under the amended version, the maximum price of a TV channel will be capped at Rs 12, down from Rs 19 at present.
Along with this, NTO 2.0 offers customers double the channels or as many as 200 channels under the base Network Capacity Fee (NCF) slab, which is Rs 130. It is 100 channels currently.
While NTO 2.0 bodes well for the customers, broadcasters are wary of its implementations as it may restrict their post-pandemic recovery.
According to Karan Taurani, Senior VP, Elara Capital, subscriber revenue growth is estimated to drop from seven to eight percent year-on-year to three-five percent in the first year of NTO 2.0's implementation.
Subscription revenue growth prospects could also be adversely affected as TV networks that are more reliant on bouquet discounting are likely to lose out on more subscription revenue than others, believes Shailesh Kapoor, CEO, Ormax Media, a media consulting firm.
Losses broadcasters faced under NTO 1.0
After NTO 1.0's implementation, broadcasters had claimed that they lost 50 percent of their subscribers which in turn impacted advertising revenue.
Indian Broadcasting Foundation (IBF) had also noted that there was an overall loss of 12-15 million subscribers during the transition to NTO 1.0. In addition, the collective cost to the broadcasters was around Rs 1,000 crore in communicating the changes to the consumers for NTO 1.0.
While broadcasters are expected to feel the pinch due to NTO 2.0's implementation, it looks like viewers will get a lot more choice in terms of choosing what to watch and at what cost.
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