After DTH and cable, TRAI to regulate Hotstar, Amazon Prime, Netflix and other OTT platforms in India
At the beginning of this year, the Telecom Regulatory Authority of India (TRAI) implemented new regulations for the DTH and cable TV industry. While TRAI meant to implement a more transparent and justifiable system in place benefiting all the stakeholders, consumers have found it to increase TV bills and make the system more complicated. The new regulations made many make the switch to OTT platforms (such as Hotstar, Netflix and others) in large numbers. However, it seems that TRAI is also considering putting all OTT platforms under a unified set of regulations governing them. And that could happen very soon.
In a recent report from Telecom Talk, TRAI is planning to issue a consultation paper on regulating OTT platforms. A senior official from TRAI said, "Carriage of TV programming has been licensed out to registered broadcasters who are then allowed to give the content to cable operators or satellite players, under a licensing framework. If a third party, like an app, is showing the same channels without paying carriage charges and licence fee, it creates disparity. Either both should be under the ambit of the licence, or both should be exempted."
In a way, TRAI wants to make it uniform for all the players in the broadcasting industry. So far, those who subscribe to a DTH or cable operator fall under the regulations and all the stakeholders (consumers, DTH operator and broadcaster) have to pay taxes and service charges according to the rules. In comparison, the OTT apps don't have to pay any such charges or taxes. This, in turn, makes it financially easier for these players and no government agency can regulate the pricing structures as well as the content.
Currently, all popular OTT apps such as Hotstar, Netflix, Prime Video, Zee5, SonyLIV and others are bound by regulations under the IT Act. If TRAI goes ahead with this decision, then all the players will have to abide by the rules of the Information and Broadcast Ministry. And that could translate into incorporating complex pricing structures similar to what we saw for DTH and Cable operators a few months ago.
With this decision, OTT players aren't happy and are citing several reasons why TRAI cannot put them under regulations. "Trai does not have the authority under the Act (Telecom Regulatory Authority of India Act, 1997) to regulate OTTs the internet ecosystem, of which OTTs are an integral part, is governed and regulated by the Information Technology Act, 2000, and the rules notified thereunder," said Star India in the consultation paper. MX Player's CEO said, "OTT platforms are only an additional medium for viewers to watch TV channels. TV channels by themselves are already sufficiently regulated. Any additional licensing framework is entirely unnecessary."
On the other hand, there's a pressure from the DTH and Cable TV operators on TRAI to have uniform and fair regulations for all content broadcasting services. As of now, the decision is still under consultation and there's no confirmation on whether this will even work out.