TRAI favours ‘license fee’ for MSOs and LCOs ?

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Speaking at FICCI Frames 2023, TRAI Chief Vaghela made a serious comment that affects the cable tv sector. He said, “There is licensing of DTH operators, MSOs and LCOs registrations. For other mediums, there is no licensing. Coming to the license fee, I don’t know why there is no license fee for MSOs and LCOs. We have issued a consultation paper and we will be handling this.” He is almost indicating that TRAI is thinking of imposing license fee on MSOs and LCOs.
He also said that we have to welcome new technologies. “The way technology is changing and the way new players are coming, we must ensure a level playing field for all. We should not impose regulations or restrictions on the new players; less regulation is the best regulation,” said PD Vaghela, Chairman, Telecom Regulatory Authority of India (TRAI).
Talking about regulating new platforms like OTT, Vaghela said, “For OTT, there is no licensing fee and the same is the case with telecom. Under TRAI act, there is a mandate to regulate only those service providers to whom the government is giving license. We are doing our research to figure out whether or not to enter this area and issue a consultation or recommendation to the government.”
During the conversation, Vaghela shared that he has always found broadcasting to be slightly difficult to regulate and the reasons are not far to see. “One reason is that the stakeholders who are involved have very diverse interests and many times they are diametrically opposite to each other.” He cited an example of TRAI’ New Tariff Order 3.0. “There was a huge controversy and debates over that. Personally, I feel there should be complete forbearance and the regulator has no business controlling the tariff.”
He further added, “When we went for consultation, broadcasters, and to some extent DTH operators, wanted complete freedom and forbearance but when it comes to LCOs, and to some extent MSOs, they wanted regulation from TRAI. LCOs say that TRAI should completely regulate the pricing of the industry. For us it becomes very difficult to balance the interests of the stakeholders.”
In the last order we issued, we have very clearly said that the move forward has forbearance, he further added. “When we went for collaborative regulation with regard to this, we formed a committee and we provided them a platform to sit and prepare a common agenda for TRAI to work on. We came out with one order, a part which was challenged all over the country in various high courts also. But the part which deals with MSOs, DTH operators and the LCOs, that we are likely to issue with consultation very soon. But I don’t think that is a solution.”
Vaghela said that he will be very happy if the industry sits together and givesTRAI a roadmap on how we can go about with the problems. “Whether we like it or not, LCOs have problems and they have to be protected. There are a large number of LCOs whose subscription base is going down, their revenue is going down and this is a transition thing. This is a transition stage where we have to take care of them. That is one concern TRAI has. In telecom we are not regulating.”
Interestingly, TRAI has issued a consultation paper “ License Fee and Policy matters of DTH services” on 13th January. Responding to this CP, the Broadband India Forum said, “ No License Fee is being paid by other competitors of DTH Operators, such as Cable and HITS operators, despite providing the same set of service to the same market.” Taking cue from this, the TRAI Chief is also planning to propose a license fee for MSOs and LCOs.

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