The Telecom Regulatory Authority of India (TRAI) is intent on giving the cable TV and the direct to home (DTH) space a bit shakeup. The regulator has laid down the new guidelines with regards to channel pricing, in an attempt to make television subscriptions a bit more affordable. The new guidelines come into effect from 01 February.

It is a multi-layered process. First, TRAI has capped the pricing, for broadcasters, for each standard definition (SD) and high definition (HD) channel at Rs19, before taxes. This is a change from the current pricing standards, which allowed broadcasters to charge a lot more for channels which they felt were more popular. Subsequently, broadcasters are free to offer their channels as a part of a larger bouquet(s) if they so wish, but have to also mandatorily offer each channel on an ala-carte basis. Then, the cable and DTH operators have to shift all subscribers to the new pricing regime, irrespective of what the current subscription status might be.

If we are to go by TRAI’s own new channel selector tool (channel.trai.gov.in), it turns out that our television subscription bill is about to go up significantly—at least in our case, which includes the usual mix of Hindi and English entertainment and movie channels, news channels and sports channels. Most Cable and DTH subscribers will be left with two potential situations—either your subscription costs are going to go up. Or you will pay similar amount for the subscription as now, but with a significantly restricted number of channels.

Is this akin to throwing the baby out with the bathwater?

To get started, subscribers need to have in place what is known as a channel base pack. This will include 100 free-to-air channels and will be priced at Rs130 plus taxes. As per the channel selector, you can pick the free-to-air SD and HD channels, though the latter are counted as two SD channels instead. Not to say there are many free-to-air HD channels anyway, but at this time, Dsport HD and the yet to be launched Sony Ten 4 HD are listed as options in this selection.

Subsequently, users will have the option to pick the pay channels at an ala-carte price or as per the new bouquets created by the broadcasters.

Let us take the example of the highest subscription tier packages that DTH operators offer, For instance, the Tata Sky Platinum HD pack which costs Rs727.5 per month, including taxes (this works out to Rs3685 for a six month subscription) includes around 494 SD channels, 92 HD channels and 48 Tata Sky Services. Airtel Digital TV has the Infinity All HD Plan which allows access to around 591 channels. It really isn’t a debate whether you or your friends and family could watch around 600 channels or not, but the fact of the matter is, for this much expenditure per month, you get as many channels as you want to watch. Freedom of choice? It includes what everyone at home wants to see, without having to get bogged down by multiple add-on packs and what not. Incidentally, Tata Sky (as do almost every other DTH or cable company) have already had packs starting as low as Rs99 with the option to add-on channels and packages as you need.

That is here and now. But as we look to the future, things are a bit bleak.

Using the TRAI channel selection tool, we decided to pick only the genre of channels that your truly and his family watch the most, and that too picking only select channels in each genre and not all. As things are, the channel base pack doesn’t really have too many enticing options and in no scenario could we pick more than 41 channels from that list. That said, if you also watch regional language channels, this choice might be a bit wider for you. Anyway, whether you select your full quota of 100 channels or just 25, it doesn’t really matter because you will still pay Rs130 plus taxes for that.

Now comes the complication of selecting the pay channels.

TRAI all this while has been insistent on the assumption that cable and DTH companies have been short-changing consumers by offering them pre-defined bouquet of channels in cahoots with broadcasters—and that consumers would be better off if they can select every channel ala-carte. So, we took both routes to sort out our subscription—one using ala-carte picks and one using the new bouquets as defined by broadcasters.

After having done the formality of picking 41 free-to-air channels, we selected 75 pay channels. Before you label your truly as a couch potato, this selection includes a mix of channels from the Hindi GEC, Hindi movies, English GEC, English movies, news and infotainment as well as sports genres for everyone at home. For a total of 116 channels, of which 75 are paid, the subscription costs works out to Rs 1,073 per month. The cost breakup is as follows: Rs759 (Bouquet + channel price) + Rs150 (network capacity fees) + Rs164 (18% GST).

We noticed that the most expensive are the sports channels, and many of them are priced at Rs19 + taxes per channel. Star Sports Select HD1, Star Sports HD1 and Sony Ten 1 HD. As it turns out, Hindi GEC and movie channels aren’t exactly inexpensive either, with the likes of Colors HD (Rs19 + taxes), & Pictures HD (Rs19 + taxes), Star Plus HD (Rs19 + taxes) and Max HD (Rs17 + taxes) being some examples. Incidentally, if one is to claim that HD channels are viewed only by the richer subscribers and they deserve to be fleeced, that isn’t entirely true—the SD variants of Star Plus (Rs19 + taxes), Colors (Rs19 + taxes) and Set Max ((Rs15 + taxes) are some examples that many popular SD channels are priced the same as HD channels. If we are to replace all the HD channels in our list with SD channels instead, the pricing would still remain very similar to the Rs 1,073 bill that we are looking at.

Going by this example, the entire push for ala-carte pricing and offering that as an option for consumers (which was already being done, mind you) is proving to be very overrated. If you really don’t watch more than 10-15 channels, the ala-carte option is going to be very expensive for you. The reality is that if you have a TV and a TV subscription, you probably watch more than 15 channels. That is what channel surfing is, as a phenomenon, most of us are familiar with.

Looking for some respite, we decided to find some solace in the bouquets made by the broadcasters. Much against TRAI’s prescription about how bouquets are unnecessary, they truly are more cost effective. Having kept the pay channels we watch in mind, we went scouring through the endless bouquets curated by broadcasters, mostly keeping the languages in mind.

In this case, to get our most watched channels are a lesser price, we ended up with 128 pay channels instead. That is fine, but the significant change is that the monthly bill now comes down to Rs 732 per month. The breakup is: Rs 430 Bouquet + channel price) + Rs190 (network capacity fees) + Rs112 (18% GST). Incidentally, the network capacity fees has also increased, most likely because of more channels that are now a part of the subscription. You will need to factor in this cost as well, when signing up.

Some examples of the bouquets that we chose include TV 18 Broadcast Ltd.’s Hindi Family HD Bouquet at Rs50 per month (25 channels including CNN News18, Colours HD, Colors Infinity HD, CNBC TV18 Prime HD and VH1 HD), Sony Pictures Networks India Private Limited’s Happy India Platinum HD 90 pack at Rs90 per month (17 channels including SET HD, MAX HD, AXN HD, PIX HD, Sony ESPN HD and Sony Six HD), STAR India India Private Limited’s Hindi HD Premium Bouquet priced at Rs120 per month (21 channels including all Star Sports HD channels, Star Gold HD, Star Gold Select HD, Star Movies HD and Fox Life HD) and Turner International Pvt Ltd.’s Turner Family HD Pack at Rs12.50 per month (5 channels including HBO HD, CNN and Cartoon Network).

The takeaway from this exercise is that yes, while TRAI’s mission to make television subscriptions more affordable is justified, it could have simply started out by capping the channel prices for ala-carte and broadcaster bundles, and left it at that. At present, it is scraping out more than one layer unnecessarily, which is going to end up being counter-productive. The TV subscription cost is going up. Or your channel selection is being cut significantly. We really don’t understand the need for completely tearing apart the current subscription packages, which could have done with regulation such as a price ceiling. There is also no clarity on what happens if you have a multi-tv subscription at home—would you pay for two separate tariff plans for each set top box?

We will probably have more travails to share once we actually get down to switching from our current subscription to the new cable TV and DTH tariff regime.