NTO 3.0 likely to come into force today: 80% DPOs sign up for new regime

After a delay of two years, the Telecom Regulatory Authority of India’s (TRAI) New Tariff Order (NTO 3.0) is finally expected to come into force today.

exchange4media has learnt that TRAI on January 19 issued a letter asking all stakeholders to follow the notification issued by it in this regard. 

According to Siddharth Jain, Secretary General, Indian Broadcasting and Digital Foundation (IBDF), more than 80% of operators across the country have already signed up with broadcasters under the new pricing regime. 

“This is an extremely encouraging start under the NTO 3.0 regime, and we expect others to also sign up over the next few days,” said Jain.

A senior official of a cable company, on the condition of anonymity, shared that NTO 3.0 will come into force today as most DTH and other cable operators have already communicated to their consumers that prices will increase on February 1. 

While broadcasters revised pricing and filed their RIOs in December last year, some of the DPOs are waiting for the decision of the Kerala High Court in this matter. 

Cable operators and DPOs have been at loggerheads with TRAI ever since the regulator issued amendments to the NTO in January 2020. Cable operators believe that NTO 3.0 will have a negative impact on their subscriber base. In fact, the All India Digital Cable Federation (AIDCF) last month submitted a petition against NTO 3.0 in the Kerala High Court, requesting a stay on its implementation. The court, however, refused to grant a stay on the order and scheduled the case for hearing on February 8.

"The new pricing will increase consumers’ cost by at least 20-30% and cable operators will have to face the heat of this price hike. The cable TV operators who are members of AIDCF will await for the court's decision on February 8, 2023," said a source close to the case.

Meanwhile industry sources share that prices of TV channels have remained frozen for over five years, despite increased offerings by broadcasters in the face of increased price of all goods, services including the cost of production and content. “It's not a price increase, it's a long-overdue correction,” said the source. 

He went on to say that TRAI has held consultations and deliberations on NTO 3.0 with all stakeholders in the value chain, including broadcasters, DPOs, LCOs and consumer groups. The Amended Regulatory Framework 2022 reflects the issues presented by the authority and on which submissions have been invited and received. In the spirit of moving towards an environment of regulatory forbearance, broadcasters are supporting the authority, said the source. In the revised pricing, broadcasters have increased the price of some bouquets by 10-15%.

Cable company executives, on the other hand, claim that they have been losing customers over the last three years, and that the implementation of NTO 3.0 will exacerbate this trend.

Speaking on the concerns of DPOs, another industry expert shared that broadcasters are responsible for providing quality content that spans multiple genres and languages. “Today's consumers have a plethora of options to choose from, and their decisions are influenced by a variety of factors. Pricing alone cannot be a factor determining this choice.”

In the amended NTO, the regulator restored the Rs 19 MRP cap for the inclusion of TV channels in a bouquet and also allowed broadcasters to offer a maximum discount of 45% while pricing its bouquet of pay channels over the sum of MRPs of all of the pay channels in that bouquet.