TV tariff order to come up in SC

The television broadcasting industry's fight against the pricing of channels hits the last mile as they head to their final resort, the Supreme Court. The apex court is expected to hear the matter on Wednesday.

The Bombay High Court in June had upheld the validity of the tariff order by the Telecom Regulatory Authority of India (TRAI) in 2020. The petitioners, including the Indian Broadcasting Federation (a representative industry body consisting of several TV broadcasters), Television Producers Guild of India, as well as leading channels Zee and Sony, then moved the Supreme Court.

The tariff order by TRAI, the latest of which came on January 2020, had sought to rationalise charges. The MRP of individual channels which can become a member of any bouquet was brought down from Rs 19 earlier to Rs 12. One of the contentious rules stipulated that the cost of a single channel out of a bouquet (a bunch of channels usually from the same network) should not be more than thrice the average price per channel of the total bouquet. 

This incensed the big TV broadcasters, many of whom had priced their offerings in such a way that it made more sense to go in for a bouquet of channels from a big operator than to subscribe to channels a la carte (one by one). For example, if a popular Hindi entertainment channel is priced in a higher bracket, an average subscriber may find it a better bargain to subscribe to a bouquet that had the channel as well as others.

This helped bigger platforms show larger numbers for their less-popular channels, while also increasing revenue luring more advertisers.

Another contentious rule was on the network capacity fee, the basic fee every satellite TV subscriber is charged. The price of Rs 130 was kept unchanged, but while it earlier applied only to free-to-air channels, the new rules meant every distributor had to provide at least 200 channels at this price.

The TV broadcasters lobby had been fighting the case for some time, arguing its constitutional validity as well as the new order being, as quoted, “arbitrary, unreasonable and violative of their fundamental right.” While the High Court order disposed of any challenge to the constitutional validity of the order, it did give one concession to the broadcasters in the a la carte pricing clause. 

TRAI had referred to its tariff order as ''consumer-friendly'' and “aimed at ensuring non-discrimination in tariff rates.” While it argues that lower channel pricing would offer consumers choice, broadcasters worry that once bouquets get less traction, it would make many of their niche channels unviable.