The Telecom Regulatory Authority of India (TRAI) has recommended the Ministry of Information and Broadcasting that there is no need to impose any market share-related restrictions on multi-system operators (MSOs), given the intense competition in the TV distribution market among the various players vying for the consumer’s share of the wallet. This is a significant relief for the cable TV industry.
The regulator, however, advised the ministry to keep an eye on developments in the cable TV industry and take appropriate action if necessary.
Local cable operators (LCOs) should share their cable infrastructure with telecom service providers, according to TRAI, in order to facilitate the last-mile delivery of broadband services (TSPs). It is important to remember that Bharti Airtel and Reliance Jio are already collaborating with LCO partners to increase the penetration of wireline broadband in the nation.
In order to encourage LCOs to give service providers last-mile access for the delivery of broadband services, the regulator has also proposed that the government amend the Cable Television Networks (Regulation) Act 1995. For the proliferation of broadband services, TRAI has proposed adding the following provision to the CTN Act: “Cable operators may strive to provide last mile access to Access service providers/Internet Service Providers in a fair, transparent, and non-discriminatory manner.”
Regarding the topic of implementing cross-holding restrictions among different kinds of DPOs/service providers, TRAI emphasised that problems pertaining to vertical integration, horizontal integration, and M&A are being dealt with through a separate consultation process. The authority also noted that it has previously made suggestions regarding cross-media restrictions.
The existence of diverse service providers like MSOs & LCOs, direct-to-home (DTH) operators, including DD Free Dish, Head in the Sky (HITS) operators, Internet Protocol Television (IPTV) operators, and over-the-top (OTT) platforms means that the TV universe has enough competition. This is why TRAI has a liberal regulatory policy for the cable TV sector.
TRAI said that, in addition to 4 pay DTH operators, 1 HITS operator, and a few IPTV operators, there were 1,75,511 registered MSOs as of June (as of August). The regulator noted that there were between 81,706 and 1,72,063 LCOs. 43 million people are expected to use DD Free Dish. There are also more than 40 OTT platforms.
The TV distribution business, according to TRAI, is likewise dealing with issues like a declining subscriber base and low average income per user (ARPU). In addition, pay-TV users in India pay roughly 20 to 25 percent less than the average TV consumer in the US, Thailand, Malaysia, the UK, or the UK. According to the regulator, the development of the OTT market further demonstrates the intensity of the sector’s competitiveness, which is projected to continue to increase.
Therefore, TRAI stated, “the authority is of the view that at this stage there is no need to intervene in the current structure of Cable TV distribution sector at the MSO or LCO level considering the number of options available to the consumers.”
Regarding TRAI’s “Recommendations on Monopoly/Market Dominance in Cable TV Services” dated 26.11.2013, MIB had sent a backreference dated 19th February, 2021. The ministry had asked TRAI to provide a new set of recommendations in the case taking into account the advancements and expansion that had since occurred in the M&E sector.
A 50% market cap on MSOs with the state as a significant market was recommended by TRAI in its 2013 recommendations. The dominance of a single MSO is a characteristic of states like Tamil Nadu, Punjab, Orissa, Kerala, Uttar Pradesh, and Andhra Pradesh, according to TRAI’s observation at the time. The market dynamics have undergone a significant change, with DTH devouring a sizable portion of the cable TV market and being followed by players in telecom, broadband, and OTT.