TRAI rules may challenge niche TV channels, boost distributors

MUMBAI: In a market meant to amplify voices, the quieter ones may be getting muted. A study by the Esya Centre has flagged that carriage and pricing rules under the Telecom Regulatory Authority of India (TRAI) could be raising structural barriers for niche and regional television channels, even as they strengthen the hand of distributors. At the centre of the issue is TRAI’s interconnection framework, which requires channels to cross a 20 percent subscriber threshold in a given market to avoid carriage fees. Channels that fall short must either pay distributors to stay on air or risk being dropped altogether, a dynamic that disproportionately affects smaller and language-specific broadcasters.

The report notes that recent amendments have replaced a graded carriage fee system with a uniform fee for all channels below the threshold. Earlier, fees reduced as a channel’s reach grew; now, the flat structure increases cost pressures on those with limited audiences, tightening margins for niche players.

Compounding this is the discretion granted to Distribution Platform Operators (DPOs), who control carriage and channel placement. While broadcasters are mandated to supply channels, distributors can refuse carriage citing subscriber thresholds or limited network capacity. Provisions around “spare channel capacity” further dilute the must-carry principle, making it effectively conditional rather than guaranteed.

Even where channels secure carriage, the costs do not end there. The study highlights additional financial burdens through payments for placement and promotion expenses that can stack up quickly for smaller broadcasters already operating on thin budgets.

Crucially, the report questions whether subscriber numbers are a fair benchmark in a diverse market like India. Niche and regional channels often cater to distinct audiences, and lower reach does not necessarily signal lower demand. Survey findings indicate strong consumer appetite for differentiated and regional content, suggesting current rules may be out of step with viewer preferences.

The study also points to a broader regulatory interplay. Carriage rules, when combined with pricing mechanisms such as the Network Capacity Fee and bundling restrictions, reinforce distributor leverage. This, in turn, increases broadcaster dependence on distributor-controlled platforms potentially affecting competition, innovation and long-term investment in content.

The net effect, the report warns, could be a gradual narrowing of content diversity, as smaller players struggle to sustain operations in an increasingly cost-heavy and distributor-driven ecosystem.