The Telecom Regulatory Authority of India (Trai) on Thursday spelt out its position that the delivery of TV channels on local telecom networks using Internet protocol technology (IPTV) does not come under the definition of “cable TV".
The regulator’s opinion comes at a time when an inter-ministerial task force of the department of telecommunications (DoT) and the ministry of information and broadcasting is working out a policy on IPTV. Cable operators fear that the position, if accepted by the task force, may set back their ability to launch IPTV services.
Though Trai said cable operators should also be allowed to offer IPTV services and also invited responses from the industry on the issue, the cable industry criticized the move saying that it would lead to uneven treatment between the two classes of service providers—telecom companies and the cable operators.
“First of all, we do not understand the idea of a regulator putting out its position on an issue and then asking for responses," said Ashok Mansukhani, president of the MSO Alliance, an umbrella organization of cable operators and multi-service operators.
“The normal course of action should have been a consultation paper, especially at a sensitive time when the government is deciding on whether such services come under the Cable Act or not."
IPTV technology allows companies to send television signals using Internet technology on multiple media including wireless media. In contrast, cable TV signals are transmitted on physical media such as optic fibre or co-axial cables.
The question whether IPTV is the same as cable TV and so should be guided by the Cable TV Networks Act of 1995 had assumed importance in the light of the plans of telecom companies such as Bharti Airtel Ltd and Reliance Communications Ltd to enter the market.
The technology that allows phone firms, governed by the Telegraph Act, to deliver TV signals on their networks does not comply with rules of the Cable Act.
For instance, the Cable Act mandates that subscribers to cable services should be able to watch free-to-air channels without having to use a set-top box. This is not possible on the twisted-copper or fibre based networks of the telecom companies. The Cable Act also says that set-top boxes should be certified by the Bureau of Indian Standards, while the body is yet to lay down terms for IPTV boxes.
Further, foreign ownership rules set different limits for the two industries. While cable operators are allowed to have a maximum of 49% foreign investment, the cap is 74% for telecom firms.
Industry players said Trai’s stance that IPTV services do not fall under the definition of cable TV services also puts a question mark on the ability of cable operators to launch IPTV. “There are contradictions within Trai’s position," Mansukhani said. “While discussing telecom operators, they are saying IPTV does not fall within the definition of cable TV and telcos don’t have to abide by the Cable Act. But then, at another place, it is also saying that the Cable Act, and the cable operator licence issued under it, is broad enough to include all distribution technologies and we can also launch IPTV."
The regulator justified this stance saying IPTV does not fall under the ambit of cable TV as they can be delivered by wireless means also, and not just through cables.
“IPTV service can be delivered using Telecom Network local loop, optical fibre or wireless media... Hence, delivery of such signals cannot be termed uniformly as delivery through cable. Therefore, IPTV service provided by telecom operators is not the same as ‘cable service’," it said. In its ‘position paper’, however, Trai has mentioned that the cable licence is enough for cable operators to start IPTV.
Mansukhani pointed out that traditional cable operators are increasingly shifting to digital means by junking the cable in favour of optic fibre. “Most of the MSOs today carry their signals on fibre. Does that mean we also don’t come under the Cable Act?" he asked.
Industry observers pointed out that Trai’s suggestion that IPTV services be governed by two separate laws—the Indian Telegraph Act and the Cable TV Networks Act—depending on the class of service provider was not the best solution for the problem.
“The fact is that the business is converging," said Poonam Nischal, communication industry analyst with the Mumbai-based broker ICICI Securities Ltd. “The distribution arms of communication companies and content distribution companies (cable TV operators) are going to compete with each other as they step into each others’ territory. What we need is a uniform approach and uniform laws, irrespective of who is providing and how is it being provided."
This is the second time that Trai has come out with a paper on IPTV. Its first consultation on the subject, more than a year ago, was abandoned because of the differences of opinion among cable operators and telecom companies on the issue.
The regulator had also sent a letter to the ministry of information and broadcasting and DoT pointing out that there was a need to bring clarity on the rules that apply to IPTV services.
IPTV has the potential to disrupt the cable market as the subscriber can watch any programme at any time including features such as pause, rewind, forward and play, except for live programming.
As for the regulation of content on the two platforms, Trai said: “The content will be regulated under up-linking or down-linking guidelines issued by the ministry of information and broadcasting."
The regulator has invited public comments on the issue till 20 September.
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