Bombay HC maintains new TRAI tariff order
The Bombay High Court on Wednesday confirmed the constitutional validity of the New Tariff Order (NTO) of the Telecom Regulatory Authority of India (TRAI), except for two pricing conditions.
A division bench of Judges AA Sayed and Anuja Prabhudessai said the à la carte the prices of each pay-per-view channel forming part of the package must not exceed three times the average price of the package of pay-per-view channels of which the channel is part. The second condition being the sum of à la carte the tariffs of the pay channels which are part of a package may in no case exceed one and a half times the price of the entire package of which the channels are part.
In August 2020, TRAI made a provisional declaration of no enforcement action by the body against broadcasters’ non-compliance with the ONT, which will continue for an additional six weeks.
The court heard a series of motions filed by the Indian Broadcasting Foundation (IBF), the Film and Television Producers Guild of India, Zee Entertainment Enterprises Limited, Sony Pictures Networks, Disney Board, Asianet Star Communication and Star India, against TRAI.
These broadcasters are challenging certain regulations and the ONT amended by the telecommunications authority. On January 1, 2020, TRAI introduced a new rule that reduces the cost of a channel subscription from 19 to 12 per month for broadcasters. The reduced price cap was to be included in their pack by January 15th.
The IBF petition states: “Broadcasters, content production companies, operators and their related service providers together employ over 10 lakh people in the industry. The contested provisions of TRAI which control virtually everything from setting a ceiling price for a channel to be included in a package to prescribing twin terms will have a negative impact on the financial viability of the company.
The petition also explains: “A normal Indian family is likely to choose one or more channel packages that would provide all of these kinds of channels instead of choosing pay-per-view channels from each category. It is argued that consumer choice of TV channels is based on personal and demographic preferences such as age, gender, culture, etc.
Other petitions express similar concerns: “It is patently arbitrary to unilaterally and unnecessarily reduce the price cap on the maximum price at which a channel can be charged in order to qualify to be part of a package. Above all, there is no justification given for reducing the ceiling price.
The arguments common to all means are that such a restriction infringes on the fundamental right guaranteed to all broadcasters under Article 19 (1) A (to freedom of speech and expression) and Article 19 (1) G (to practice a profession or to carry on an occupation, trade or business) of the Constitution of India and that any restriction on these rights must be reasonable. However, this cannot be considered a reasonable restriction, they argue.
According to TRAI, subscribers do not choose à la carte channels due to the fact that channel packages are available at a reduced rate, and broadcasters have abused their freedom to set rates for à la carte chains and bouquets.