The Calcutta High Court on Wednesday directed the Additional Solicitor General to explain whether a clause of negotiation between MSOs and LCOs in the Telecom Regulatory Authority of India (TRAI) notification for revenue sharing is illusory or not.
The direction came on a TRAI prayer after the court on Tuesday stayed the implementation of its new tariff order and regulatory regime on a prayer by around 80 Local Cable Operators (LCOs).
TRAI had unveiled the new tariff order and regulatory regime for the broadcast and cable sector, which would pave the way for consumers to opt for channels they wish to view, and pay only for them.
It had said every channel should be offered a la carte, with a transparent display of rates on electronic programme guide. Although TRAI had prescribed a phased roadmap for customer onboarding by players, the pace for the same was sluggish at the beginning.
The LCOs, who provide cable television connection to subscribers, claimed that the tariff order was heavily loaded in favour of Multiple System Operators (MSOs), who are the distributors of tv channels, and would render their business financially unsustainable.
Justice Arindam Sinha Tuesday stayed the 2017 notification of TRAI till February 18 and asked it to see whether the terms and conditions can be revisited.
Seeking a recall of the order, ASG Kaushik Chanda Wednesday submitted that the MSOs and LCOs have the option of either entering into a revenue sharing agreement mutually or go for a TRAI-fixed norm.
The TRAI-fixed norm says that an MSO will get no more than 55 per cent of the revenue pie for MSOs and LCOs, while the cable operators will get no less than 45 per cent of the proceeds meant for them, with each having to provide certain facilities and services as mandated by the regulator.
Chanda also submitted that instead of giving a clear 48-hour time for moving a petition after serving notice, the petitioners' lawyer had moved the court on January 29 after the notice was received in Delhi a day before on January 28.
He submitted that TRAI was not represented in the court when an order was passed on its notification which will have a pan India-effect and is scheduled to be implemented from February 1.
The petitioners claimed that the terms and conditions are heavily titled towards the MSOs.
The matter will be heard again on Thursday.