The Telegraph
Since 1st March, 1999
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Cable rates rise on inflation

Dec. 1: Viewers all over the country will have to pay more to cable television operators from January next year.

The announcement was made today by the Telecom Regulatory Authority of India (Trai) in view of inflation.

'On the basis of analysis done by (Trai), the inflation adjustment works out to 7 per cent. Accordingly, it has been decided to issue an amendment order providing for revision in the ceiling on account of inflationary adjustment to be effective from January 1, 2005,' said a statement released by the telecom regulator, which had been appointed the cable watchdog during the tenure of the NDA government.

Cable operators in Delhi now charge in the range of Rs 200 to Rs 300, depending on the locality, while the range in Calcutta is Rs 150 to Rs 250.

The hike is applicable to cable charges, excluding taxes, payable as on December 26, 2003, the date which Trai had set as ceiling for cable tariff earlier.

'If the payment was Rs 220 per month of which Rs 20 was on account of taxes, the seven per cent increase will be applied to Rs 200 and an increase of Rs 14 per month would be the maximum permissible increase,' the Trai statement said.

The new rates will apply to payments to be made by consumers to cable operators, operators to multi-system operators (MSOs) and MSOs to broadcasters.

Trai's earlier order had put a freeze on cable rates for all areas where the conditional access system (CAS) was not implemented. Chennai is the only city which has CAS now.

The Centre had also increased the service tax on cable operators from eight to 10 per cent and levied an education cess recently.

'It is certainly a welcome move,' said Amit Nag of Indian Cable Net, the largest MSO in Calcutta. 'However, we feel that Trai has taken this decision keeping only the increase of components and operational costs in mind. Price and subscriber-base hikes carried out by broadcasters have not been considered.'

According to industry sources, Trai is considering a proposal to do away with the price ceiling and allow the rates to be determined by market forces. A decision is expected by December 25.

'The Trai decision will help operators realise a certain amount from viewers, which they had not been able to since December last year,' said Mrinal Chatterjee, a north Calcutta cable operator. 'However, it must also be ensured that broadcasters are not allowed to increase subscriber bases,' Chatterjee added.

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