TRAI REGIME: A TRAI-L BY FIRE?
According to the new framework - aimed at empowering consumers with the choice of paying only for the TV channels that they want to watch - all DTH and cable channel subscribers will need to subscribe to a base pack of Rs 130+ taxes to watch 100 freeto-air (FTA) channels that users can select out of 500 channels. However, this base pack will not include some of the popular channels offered by major broadcasters. Most broadcasters have already unveiled their value packs along with their a-la-carte prices that consumers will need to select from. Some broadcasters have had to convert a few FTA channels to pay in the new bouquets.
However, the industry is still trying to figure out if the primary purpose of the entire exercise will be served by the new tariff regime. Considering the steep discounted rates that are being offered on bouquets, experts feel that consumers might not be interested in opting for value packs individually and will eventually end up paying for bouquet offerings. Currently, the bouquet pricing is much lower than the a-la-carte pricing, and if a consumer has to buy channels individually, in case a bouquet does not contain the channels of his choice, he might end up paying much more.
So far, a lot was also dependent on the 15% discount cap on which the Supreme Court verdict was awaited. However, on January 4, 2019, the special leave petition (SLP) filed by TRAI seeking clarification on the 15% bouquet discount cap was dismissed as withdrawn in the Supreme Court.
A recent report by Edelweiss predicted that if consumers end up paying more than they were initially paying, broadcasters will need to re-look at their packages which could lead to price recalibration or bouquet trimming. This means that the initial packages launched by each broadcaster may not really be the final package. Each player will wait to observe consumer behaviour and modify their plans and packages accordingly, with time. Most broadcasters believe things will take around six months to a year to settle down, both from the perspective of consumers as well as the DTH players and LCOs.
THE TARIFF PACKS
Star India has introduced the Star Value Pack at Rs 49 in Hindi and is running a campaign with its most popular faces to inform viewers about it. Viacom18 and TV18 have joined hands to address the issue of price rise as they launched their Value Pack, comprising top channels across genres at Rs 1 per day. Zee too has launched its communication initiative ‘Channels Ka Chunaav 2019’. It will be offering three types of packs to cater to different viewer needs. While Prime Packs are based on core regional language consumption, Family Packs will offer top genres and All-in-One Packs will provide all genres. The Zee Family Pack is targeted at the Hindi Speaking Market (HSM) and has been priced at Rs 45 per month for 24 channels.
In the South market, major players have come up with individual pricing too. Moreover, major DTH operators like Airtel Digital TV and Dish TV have also announced their new channel pack pricing.
GUIDELINES & IMPLICATIONS
As part of the new regime, pay and FTA channels cannot be a part of the same bouquet, which has resulted in broadcasters converting some of their previous FTA channels to pay channels/bouquets under the new regime. The aim is to make sure that people subscribe to some of the less popular channels too.
Data from the Broadcast Audience Research Council (BARC) India has revealed that out of the 300 channels bundled together, 50% of consumers do not watch more than 30 channels. In such a scenario, is there a chance of less popular channels slowly phasing out? Karan Taurani, VP- Research (Media sector) Elara Capital, feels the move will have a negative impact on niche channels. “Niche channels of large broadcasting groups, which are not included in any bouquet, will fade out in terms of viewership as consumers will not look at buying them on a-la-carte basis,” Taurani says.
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