Publications
Partners
Cape Town – A quiet but dramatic change is coming to India and it’s something that South Africa's pay-TV subscribers have been clamouring for.
From 1 February India's satellite pay-TV customers will get to pick and only pay for the TV channels they want – but there are some catches.
The hope is that pay-TV subscribers in India will be paying less for their monthly pay-TV subscription bill when they only choose the TV channels they want.
That, however, might not necessarily be the case and the regulatory move is more about improving "openness and transparency" about the price of pay-TV services than making pay-TV subscriptions cheaper.
According to reports, in a move that will have a far-reaching impact for pay-TV viewers and pay-TV operators in India, the country's regulator is forcing all pay-TV companies to publish prices of individual pay-TV channels, and to allow pay-TV consumers to pick and only pay for the channels they want.
In Canada a similar regulatory move by the CRTC in 2016 was an epic failure when that country's broadcasting regulator ordered pay-TV companies to provide consumers with a limited bundle of main TV channels, and in 2017 ordered them to make an option for individual pick-and-pay TV channels available.
ALSO READ: DStv CEO on why you can’t pick your own TV channels
Since the introduction of the so-called a-la-carte option instead of the so-called bundling of channels into pay-TV packages, Canada's pay-TV subscriptions have been in decline (further fuelled by the growth in video streaming services like the arrival of Netflix).
India’s broadcasting regulator is now mandating similar sweeping changes from 1 February – something that South African pay-TV subscribers have also asked for, but that companies like MultiChoice (that runs the DStv and GOtv services in South Africa and across sub-Saharan Africa) have said is not possible to do or to provide.
The Telecom Regulatory Authority of India (TRAI) has not just ordered the country's pay-TV operators to provide the pick-and-pay of individual TV channels as a new system option to existing and potential pay-TV subscribers, but has also ordered pay-TV companies to list upfront the price of every TV channel.
TRAI is going even further and although India is a free-market consumer economy, has ordered a cap on the maximum price per TV channel a pay-TV operator will be allowed to charge -Rs19 or R3.78 per month.
TRAI says the new pick-and-pay system for the TV channels pay-TV users want will "free" viewers in India from having to pay for a specific set of TV channels in a bouquet or package in the way that MultiChoice, China's StarTimes/StarSat, Deukom and others in South Africa and Africa have sold traditional pay-TV subscriptions.
(CONNECTED: A technician repairs a direct to home television satellite disk at Guwahati in the northeastern state of Assam in India. Photo: Partha Hazarika/NurPhoto/Getty Images)
There are several small print caveats, however.
India's pay-TV subscribers should get ready for the listicle bill. Similar to hospital, hotel, and restaurant bills, India's pay-TV subscribers are going to hit pay-TV subscribers with itemised billing.
It does mean bigger transparency for every purchased line-item with customers able to see exactly what they're charged for but also the opportunity for pay-TV operators to add additional charges for items and services that previously were lumped in somewhat for "free" or as part of an overall cost.
For instance: It won't be possible to pick and pay for just one TV channel. Every pay-TV subscriber will pay from the outset for a basic package of 100 standard definition (SD) free-to-air TV channels. Those 100 channels will come with a base cost called a monthly "connection fee".
It also means that receiving free-to-air channels through pay-TV in India will no longer be free.
Beyond the basic 100-channels bundle, pay-TV subscribers will be able to pick and add channels individually, each at a different cost, but no channel will be allowed to be more expensive that the maximum fee for an individual channel set by the regulator.
ALSO READ: People want to pick their own TV channels – until they find out how much it will cost
After reports that pay-TV costs will rise, TRAI in a press release admits that India's pay-TV subscribers will pay less but that it's from the understanding that a pay-TV household will also have and want a reduced number of TV channels. TRAI says consumers will pay less because they will decide to have less TV channels.
TRAI worked on a model of 50 TV channels, saying "more than 90% of TV homes view/flip 50 or lesser number of channels".
"Therefore, any analysis that keeps 250 or more channels for pricing of monthly tariffs, creates a false impression."
"If a consumer chooses the channels which he really watches, then he will be paying a lesser amount compared to what he's paying as of now."
Will watching pay-TV in India get costlier? Well, not from the beginning, and not immediately, and also not if a consumer chooses only a few channels. Pay-TV operators are already working on offering and building in steep discounts to maintain current pricing levels and to prevent any bill shock during and after the switch-over.
But over time – and only time will tell – once heavy discounts expire or are phased out, monthly pay-TV bills in India could possibly increase. Consumers who also opt for a lot of TV channels will pay more.
Another element to keep in mind is that the administration systems and admin costs of running and implementing numerous different customer channel choices, as well as paying for channel carriage agreements in order to have those potential channels available as a choice for potential picking by consumers, will add a big financial burden to pay-TV operators' operating costs bottom-line.
These are costs that pay-TV companies, like any business in the business of making a profit for shareholders, will pass on to customers.
