The long-term packs in the DTH industry have become a cause of controversy lately. When the new regulatory framework by the Telecom Regulatory Authority of India (Trai) came into effect, it dismissed all the existing packs that the consumers were subscribed to, including the long-term packs and asked them to upgrade to the new channel packs. However, subscribers were enjoying these packs even before the new rules had come into play, and they were of the thought that these packs would continue to function the same until validity expired. As per a new ET report, Tata Sky, the prominent DTH provider, has managed to get a stay on the latest Trai directive about long-duration packs.
Tata Sky Argues Against Trai's May 1 Directive
Many DTH consumers opted for such packs which came in quarterly, six-monthly and annual options, but after these plans were revoked, the customers felt cheated. When the new norms were implemented, and when these subscribers did not make any channel selections, they were automatically downgraded to the best-fit plans as directed by the sector regulator. These subscribers were of the thought that they would not have to pay anything extra until their plans were valid.
Later seeing the consumer sentiment, Trai issued a directive on May 1 ordering the DTH companies to honour the long-duration packs and continue providing this service if the consumer hadn't selected channels. However, in a new development, Tata Sky has approached Delhi High Court and has managed to get a stay on this directive on Wednesday, and now the matter will be heard on July 11.
Consumers Now Paying More Because of New Directive
A senior executive in a DTH company said that the problem is multi-fold, he added, "At one end, Trai directed us to migrate all the consumers to the new regime or a 'best-fit plan' based on their existing packages, while after getting a backlash, it is now also asking us to honour the long-duration packs. This will create confusion." The DTH operators have also highlighted that the new tariff regime has switched up the revenue sharing model as well, which now makes it almost impossible for the companies to provide 200-300 channels at the same cost.
Not only DTH providers, but broadcasters are also of the same opinion, as one of the major broadcasters said about DTH providers, "If they want to, or have to, give channels as per the old arrangement, they will have to shell out money from their pockets."
Tata Sky argued in the court saying that Trai's new directive contradicts its own framework and it would result in two parallel regimes, thus exposing the DTH companies to massive losses. The DTH provider highlighted that the regulator's direction in February had asked to migrate all subscribers to best-fit plans in case they hadn't made their selections. However, the new May 1 order reverses the stance on the previous order and contradicts it.