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For
DTH (direct-to-home), teleport and HITS
(Headend-In-The-Sky), Trai's recommendations
are in line with the government proposal.
Trai has suggested lifting the cap to 74
per cent (from 49 per cent) for DTH and
teleport. In case of HITS (where there is
no FDI policy as of yet), the sector regulator
also wants the limit to be at 74 per cent.
For
mobile TV, Trai has recommended 74 per cent
foreign investment limit. At present, there
is no policy on FDI in mobile TV.
On
satellite radio, the sector regulator will
be sending its recommendations separately.
Trai has maintained status quo in case of
uplinking of non-news TV channels and downlinking
of TV channels where the foreign investment
limit is at 100 per cent.
Justifying
the reason for raising the cap on cable
networks, Trai said the issue is to have
a framework which will encourage flow of
funds into this segment. "This will
then lead to consolidation in the last mile
cable operations as well as upgradation
of the network. It is also expected that
consolidation will lead to greater competition
in the last mile because large corporate
entities cannot be easily stopped from expanding
their area of operation into the territory
served by the rival cable operators. This
will greatly benefit the consumers,"
the regulator pointed out.
Further
elaborating, Trai said: "The roadmap
should protect the existing investments
in the cable networks and guide the incremental
investments towards upgradation and modernization
of the infrastructure."
The
information and broadcasting ministry had
expressed concern that being the backbone
of TV distribution system, it wasn't advisable
to allow cable networks to pass into foreign
hands.
Terming this as an overcautious approach,
Trai said "it is inconceivable that
even after consolidation all these networks
will pass on into foreign hands." Besides,
there are already four functional DTH operators,
and three more are in the pipeline. All
these DTH operators are large corporate
entities and they would provide competition
to the incumbent cable operators, whether
foreign owned or domestically held. The
cable network will be in a better position
to face competition if revamping through
higher investment is accomplished.
As
for raising the cap on news, Trai said it
would not result in management or editorial
control getting transferred to foreign entities.
"The better way to ensure that subversive
content is not broadcast through TV channels
is by having proper content monitoring and
regulation through content code, instead
of using foreign investment limits as the
the tool for this purpose," Trai added.
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