The Hindu Business Line : Broadcasters seek inflation adjusted price hike

They are believed to have asked the Telecom Regulatory Authority to allow a price increase taking into account rising costs. Consumers could, in turn, be charged around 8 per cent more come New Year, if the increase is passed on. “Costs have mounted significantly, and we welcome the move,” said Mr Anuj Gandhi, CEO of the Multi-System Operator, DEN Networks.

The 2004 Tariff Order had frozen the rates prevailing as on December 26, 2003. Two inflation triggered amendments had been announced after that. With one lost in litigation, broadcasters are in effect charging 2003 rates with a 4 per cent increase.

The TRAI in October 2007 had also fixed ceilings for what a consumer, depending on the city he lived in could be charged. So, while 20 pay channels and 30 free-to-air channels could cost a maximum of Rs 160 in ‘A’ category city, it would cost Rs 20 less in a ‘B’ city.

The MSO Alliance thus hopes that any cost benefit granted to broadcasters is passed on through the value chain. Cost of transmission has also gone up for the cable operator, who is bound by TRAI’s ceilings, said Mr Ashok Mansukhani, President, MSO Alliance. “The Government should also push its other plans such as the digital rollout, or implementation of Conditional Access System so as to ensure consumers have genuine choice and can be billed to their requirements,” he added.

Channel prices in CAS mandated areas are capped at Rs 5 each.

Sports channels such as ESPN, who pay millions for exclusive rights of big league tournaments, have always argued that all content can’t cost the same.

“Why should prices of television be regulated at all when the Government has been pushing for decontrol of pricing in all other commodities?” asks a Zee spokesperson.

“Television entertainment is a necessity, and its price should be regulated in the interest of consumers,” argues Mr Bejon Misra, of Consumer Voice. Inflation by itself cannot be a justified reason to allow a price increase, he says.

He would prefer a consultation paper and debate that takes other parameters such as growth in subscriber base and advertising revenue into account before any price increase is allowed to broadcasters.

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