Broadcasters' Pricing Tactics Under Scrutiny Consumers Face the Brunt
Major broadcasters have once again given a substantial blow to consumers, hitting them where it hurts the most – their pockets. The broadcasters have hiked the prices of channels and particularly bouquet offerings sending shockwaves through the cable TV industry.
The pricing underwent an increase in February 2023, and again, a year later, in February 2024, a subsequent increase was implemented. This price hike, ranging from 10% to a staggering 50% across all bouquet offerings, became effective on February 1, 2024. This left both consumers and industry insiders alike surprised and unprepared for the sudden surge in prices. The decision has triggered widespread dissatisfaction among viewers and concerns within the Cable TV fraternity.
Testimonials from consumers on various social media platforms pour in, serving as a compelling narrative and highlighting the far-reaching consequences of the sudden surge in prices. These accounts reveal the substantial strain imposed on households that are already contending with financial hardships, painting a vivid picture of the challenges faced by individuals and families in managing their budgets amidst the increased financial burden.
Beyond the immediate impact on frustrated consumers, the repercussions extend to cable operators who find themselves navigating a distinct set of challenges. The escalated prices of channel bouquets directly contribute to heightened operational costs for these operators, creating a ripple effect where additional expenses are inevitably shifted onto consumers. The intensified impact has rendered thousands of these operators non-operational, marking a significant downturn and loss of jobs for lakhs of people working in the industry. The Cable TV industry at large is now confronting profound implications stemming from this calculated move by the broadcasters.
The broadcasters have implemented a significant price hike, showcasing key highlights when comparing prices from year on year.
Over the past five years, owing to this significant increase in price, the Cable TV sector has witnessed a steep decline in its subscriber base, losing half of its viewers—from 110 million in 2017 to approximately 55 million in 2023. Interestingly, on the other hand, broadcasters, aiming to gain more financial benefits have strategically aligned their interests with Over-The-Top (OTT) platforms. This alignment is with an intention to weaken the Cable TV industry and drive customers toward alternative streaming options at a cheaper price.
The pricing strategies and questionable practices by the broadcasters have now come under the scrutiny of the Standing Committee on Communications and Information Technology (SCCIT). The committee raises concern about the prevalent approach of offering substantial discounts on bouquet pricing while maintaining high individual prices for a-la-carte channels
Broadcasters exploiting this strategy have led to a staggering surge in Pay TV channel prices, reaching up to 600% since the implementation of the NTO in 2019. This surge primarily stems from the mandatory bundling of all channels, adding an extra financial burden on Pay TV subscribers.
In light of these challenges, the Standing Committee on Communications and Information Technology (SCCIT) proposes the empowerment of Distribution Platform Operators (DPOs) with the authority to selectively choose individual channels from broadcasters' bouquets. This recommendation seeks to introduce a more tailored and personalized aspect to the Cable TV industry, allowing DPOs to curate packages based on consumer preferences. The aim is to create a more responsive and consumer-friendly marketplace, addressing the current concerns of viewers who feel affected by broadcasters' profit-oriented decisions.
Peeush Mahajan, serving as the President of the All India Digital Cable Federation (AIDCF), extended a warm welcome to the parliamentary panel's report. In an expression of appreciation, Mahajan commended the thorough examination of these critical matters and the thoughtful recommendations proposed by the committee. Talking about the intricate challenges faced by the industry, Mahajan underscored the struggle for survival, a predicament worsened by significant increases in pay TV channel prices and the forced bundling imposed by broadcasters. He emphasised the urgent need for a holistic consultation by TRAI, urging prompt action to safeguard the sector's continued existence. Mahajan's concern goes beyond the industry itself, extending to the livelihoods of the countless individuals employed in the sector, creating a compelling plea for comprehensive measures that not only ensure industry resilience but also protect the well-being of those dependent on it for their livelihoods.
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