“Dear Airtel Digital customer, your favorite channel.. along with all 56 channels in Star India bouquet is likely to be disconnected on Airtel Digital,” read the scroll on its channels on Sunday. It urged users to call the DTH operator and get more details on why this was happening.
The move comes three days after Bharti Airtel controlled Airtel Digital stopped including Star India’s channels on all its packages, and asked users to pay between Rs 10 to Rs 50 per month to watch each of the channels.
This was done after Star India refused to give the discounts demanded by Airtel Digital in its pricing negotiations with DTH operator.
Without the discounts, Airtel Digital felt it cannot provide Star channels as part of its packages. The DTH provider has various packs, including the so-called ‘base packs’ and ‘addon packs’ which offer television channels at discounts of up to 90% on their individual or a-la-carte rates.
This discounting is made possible by demanding similar discounts from upstream providers like Star for all channels sold as part of a pack — something that the TRAI has been trying to control.
However, this time, the two companies seem to be having trouble arriving at a mutually acceptable level of discount.
The affected channels including Star Sports, Star Movies, Star World, Asianet, Star Vijay and others.
According to Indian laws, it would be illegal for Star India or any other channel owner to refuse to provide their channel to any cable or DTH company.
However, channel owners can block their feeds if the cable or DTH operator does not give them the correct subscription charges, or refuses to share data about how many people have subscribed to their channels. This is likely to be the justification that Star could end up using if it puts into action its threat to block all channels.
Ironically, both companies have opposed a move by the sector regulator to stop the practice of ‘bulk’ discounts on packs and bring in transparency in channel pricing, avoiding such deadlocks.
Last year, Airtel Digital, Star India and Tata Sky successfully approached the various courts in India to stop the sector regulator from imposing the transparency guidelines on the sector.
These guidelines would have forced broadcasters like Star India to declare the actual selling price of their channels up front and forced them to stick to these prices, whether or not the DTH provider bought 1 channel or 100 channels.
As part of the regulation, TRAI sought to put severe curbs on the ability of companies like Star India to charge a very high price when channels are purchased individually by the DTH or cable company.
This was done to prevent channel owners from forcing companies like Airtel Digital to carry all their channels and to give the DTH and cable companies the freedom to pick and choose which channels they wanted to buy.
However, Airtel Digital too opposed the rules they would also have prevented it from forcing unwanted channels on individual customers via bundling and packaging.
At present, channel owners force cable and DTH companies to carry all their channels — wanted and unwanted — by charging very high rates for single channels compared to pack rates. DTH and cable companies, in turn, do the same to their consumers.
TRAI wanted the system to be more transparent and flexible, and give consumers the ultimate power to decided which channels they wanted to buy.
Smaller cable companies are in favor of TRAI regulations as they anyway don’t get the kind of discounts that big players like Tata Sky and Hathway get. They believe that the TRAI regulations, which will force channel owners to transparently declare their real prices, would remove the disparity between the prices they pay and those that are paid by big networks.
However, the Madras High Court last week ruled that the TRAI did not have the right to regulate the pricing structure of channels and packs.
The TRAI has appealed the Madras High Court ruling at the Supreme Court, which will take up the matter tomorrow (Monday).