DPOs seek lower broadcaster payouts as TV subscriber base shrinks

NEW DELHI: The remote isn’t the only thing changing hands, India’s pay-TV industry is renegotiating the bill as well. Distribution platform operators (DPOs), including Tata Play, Airtel Digital TV and GTPL, are seeking lower payouts in their carriage agreements with broadcasters as declining subscriber numbers and repeated channel price increases continue to erode margins, according to an Economic Times report citing industry executives.

DPOs, which deliver television content through cable, direct-to-home (DTH) and headend-in-the-sky (HITS) platforms, argue that existing commercial arrangements have become increasingly difficult to sustain. While subscriber bases continue to shrink amid the migration to digital streaming services, broadcasters have continued to revise channel prices upwards, placing additional pressure on distributors’ profitability.

According to executives quoted by the publication, many operators remain tied to near-fixed payout arrangements despite declining subscriber numbers. Although the Telecom Regulatory Authority of India’s (TRAI) New Tariff Order (NTO) does not permit fixed-fee agreements, such structures continue to exist in practice across parts of the industry.

Negotiations between broadcasters and distributors are currently underway, with some broadcasters reportedly offering limited concessions. However, industry executives said the relief has fallen short of expectations, prompting most DPOs to seek reductions of around 5 to 7 per cent in their payout commitments.

The talks reflect a broader challenge confronting India’s linear television ecosystem. As audiences increasingly shift towards digital platforms, distributors are finding it harder to deliver annual revenue growth while absorbing both subscriber churn and higher content costs.

Broadcasters, however, are expected to hold firm. Companies including JioStar, Zee Entertainment Enterprises, Sun TV Network and Sony Pictures Networks India collectively account for more than 70 per cent of television viewership in the country, giving them significant leverage in commercial negotiations with distribution partners.

The outcome of the discussions could have wider implications for India’s pay-TV market, where balancing broadcaster revenues with distributor profitability is becoming increasingly complex in the face of changing viewing habits and intensifying competition from streaming platforms.