Monopolies in Media must be curbed

By: Col K K Sharma


Most of the problems faced by the industry including hurdles in DAS implementation are due to cross media ownership, vertical and horizontal monopolies and cartelization. Lack of effective regulations in this area has made some media conglomerates create large monopolies circumventing existing rules and regulations. Even Competition Commission has failed to nail them down as everything appears fine on paper whereas ground realities are very different. These companies are taking undue advantage of their monopoly by indulging in unfair practices which are difficult to prove in court of law.

In any democratic setup to bring plurality and diversity we need to empower small enterprises and create a level playing field to introduce fair competition. The Government should treat these practices especially in the media & broadcasting industry as anti national and a criminal offence because it destroys plurality of views so much essential for a democracy to survive. It also takes away the constitutional right of thousands of self-employed people to respectfully and peacefully earn their livelihood.

Some of the ills dogging the industry

1.Growing vertical monopolies/cross media holdings and cartelisation in content as well as distribution platforms.

(a)Broadcasters should not be allowed to invest in distribution platforms like DTH, MSO, IPTV, HITS, Mobile TV and Broadband and vice versa.

(b)DTH Operators, HITS, MSOs, Mobile TV, IPTV operators should not be investing in each other business.

(c)Restrict same VC and FIIs to invest in more than one media / broadcasting / Distribution Company. Also check background of the investors, particularly the foreign investors. This will result in more investors / service providers coming in this trade and benefit Consumers. This will also bring more transparency to the business.

2.Cartelisation by Broadcasters in the name of Consolidation.

(a)Content aggregator companies were raised hiving off distribution departments of pay broadcasters to form distribution cartels having greater power of negotiation and even blackmailing.

(b)Definition of Broadcaster as given in the Cable TV Rules states ‘any person including an individual, group of persons, public or body corporate, firm or any organization or body who or which is providing programming services and includes his or her authorized distribution agencies’. Although purpose of this definition might be to include agents of foreign broadcasters who were handling their affairs in India before the downlinking guidelines were notified, aggregators who had no identity so far are deemed to be Broadcasters now.

(c)Aggregators of these broadcasters are now making bigger cartels forming JVs and becoming more powerful than before just at the time when the whole cable TV industry is struggling to implement government mandate of Digitalisation.

(d)Since all broadcasters down-linking in India must be registered and have their offices in India, there is no place for aggregators. All agreements with cable operators and MSOs must be signed by the broadcasters individually because they are liable to provide legal content to the distributors complying with Cable TV Act and Rules including programming code and advertisement code. Thus, there is a need to redefine ‘Broadcaster’ and aggregators if identified as separate stakeholders, must be licensed and cross media restrictions be applicable to them as well.

Suggestions to curb monopolies

Broadcasters

(a)Restrict the number of channels registered by each broadcaster and in each genre.

(b)Every broadcaster should distribute its contents themselves or shall appoint a minimum two agencies / aggregators. None of these aggregators should themselves own distribution platforms like MSO/DTH/Mobile TV/IPTV.

(c)Broadcasters must declare MRP of individual channels as well as bouquets of channels to the subscribers so that transparency be maintained.

(d)Presently restriction of 12 minutes per clock hour on advertisements is same for FTA and pay channels. This is unjustified. For pay channels the cap on ad duration per hour should not be more than 6 minutes. Apart from making a difference in the two types of channels, conversion from one to the other will also benefit the subscribers. If subscriber opts for FTA channel he pays less and if he subscribes a pay channel, he can freely watch the channel with less of advertisements.

(e)One of the reason Broadcasters were pushing for speedy implementation of DAS was that they were getting only 15-20% of subscription revenue due to under declaration. Now DAS has been successfully implemented in all the TAM cities and their revenues should be shooting up with introduction of transparency in subscriber numbers, TRAI must make them strictly adhere to the advertisement caps and also control their channel prices to benefit the consumers.

MSOs

(a)Restrict the total number of subscribers per control room like one control room should not have more than 1 million subscribers. For example if MSO disturbs signals of any broadcaster in a large network, he may make an excuse of a technical problem and get away with it but if the same MSO has more than one control room and in all the control rooms a similar problem remains, then it becomes clear that it is a deliberate act.

(b)If an MSO has 4 million subscribers then as per TRAI guidelines unless 5% (200000) subscribers demand any particular channel MSO need not telecast that channel on its network. Whereas if he has to establish a headend for only 1 million subscribers, demand from only 50000 subscribers will make him telecast the channel.

(c)Ensure that MSOs do not have more than 20% share of total subscriber base of the respective city. Apart from this restriction, state level restriction can also be imposed depending upon the size of the MSO. An MSO can be restricted to a particular state according to licensed conditions.

(d)After implementation of DAS MSOs have been given an upper hand in controlling LCO’s subscribers as well as their revenue. This is likely to make them force the LCOs to give them stakes in their networks as JV partners. This may also force some LCOs to handover their entire business to them. This must be checked and controlled right in the beginning else it may lead to furthering the cause of large monopolistic MSOs supported by their broadcast companies. This situation will be very harmful for the subscribers too.

Most of the problems faced by the industry including hurdles in DAS implementation are due to cross media ownership, vertical and horizontal monopolies and cartelization.

Bring Interoperability

Government should also permit technical interoperability to benefit the subscribers. TRAI should give strict instructions to the distribution platforms like MSO/DTH etc. that if a subscriber purchases a set top box from open market which is interoperable (with CI slot), then MSO/DTH player must provide CAM Module + CAS card to the subscriber so that subscriber can easily switch over their service provider.

DTH Must be stopped from interfering in Cable TV Digitisation.

(a)DTH should not be allowed MDU.

(b)Enforce technical Interoperability as provided in the Guidelines.

(c)If any subscriber of a DTH service wishes to switch to DD Direct+ of Prasar Bharati on the same STB, he should be able to do so by just tuning on DD DTH service.

DTH guidelines that have been issued by the Ministry dilute some of the restrictions on cross-media and intra-media holdings that were conceived in the Broadcast Bill presented to Parliament in 1997.

Broadcast Bill must be introduced soon

DTH guidelines that have been issued by the Ministry dilute some of the restrictions on cross-media and intra-media holdings that were conceived in the Broadcast Bill presented to Parliament in 1997. That Bill was referred to a Select Committee and only lapsed when the Lok Sabha was prematurely dissolved in December 1997. But clearly, in dilu ting the anti-monopoly spirit of the 1997 Bill the government today seems to have accorded higher priority to the pragmatic consideration of attracting investment into the DTH sector. Provisions of the 1997 act to curb monopolies must be introduced soon.

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Col Sharma is a telecom engineer and a law graduate who has been the Chief Editor of Cable Quest Magazine for the last 15 years. India's leading magazine for Satellite TV Broadcasting, Digital Broadcasting, cablequest.org/articles/roop-sharma/item/2496-monopolies-in-media-must-be-curbed.html/“>Cable TV, Digital TV, Direct TV, Satellite TV, Satellite Television, Cable Operators Industries.

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