Dth Charges Hefty Carriage Fee

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Not Only Tata Sky & DishTV, Even To-Be-Launched Reliance BigTV Reportedly Charge Hefty Carriage Fees.

It was not too long also that carriage fee was a dirty word in the channel distribution business. No one wanted to talk about it, but everyone knew that it existed.

Historically, carriage fee was probably first resorted to by the Hindustan Times' "HomeTV" GEC Hindi channel, when it launched almost a decade ago. Carriage fee, either ion terms of a flat payment, or as a subsidy for the purchase of Satellite receivers & Modulators, was offer by HomeTV, as part of its 50 city, countrywide launch campaign of technical workshops and informal personal meetings with cable networks.

Initially, broadcasters projected 'Carriage Fee' almost as an extortion for distribution. Actually, TV channel distribution involves a cost, both at the Headend / uplink and in distribution. In the intensely competitive Indian TV market, consumers do not pay this extra cost, as they pay a flat fee per month, irrespective of the number of channels that they receive. Carriage fee is the only means for the distribution chain to receive a fair payment for their service of carriage.

As a ploy, several free-to-air (FTA) channels shifted to pay, in the hope that they will not only receive additional Pay revenues, but also avaoid payment of carriage fee. This ploy did not work for long, because Indian TV viewers refused to pay extra for the channels.
Today, carriage fees are accepted as a necessary cost for widespread distribution of TV channels that want prime band coverage and good reach into homes in TRP cities.


Says Dish TV managing director Jawahar Goel: "I agree carriage fee is being charged by the DTH players. I believe Dish TV would be able to earn up to Rs 50 Crore this year by charging carriage fee." He added that Dish TV expects to earn about Rs 100 Crore by next year.
Says Tata Sky MD Vikram Kaushik: "We have a limited capacity and we can carry a fixed number of channels. But the number of channels is growing everyday. Hence, we have started charging a carriage fee to accommodate channels that are not already on our platform. Also, if a new channel wants instant access to our 2 million subscriber base, we charge a carriage fee from that broadcaster."


Unlike Cable TV, DTH carriage cannot be controlled for delivery only into the TRP cities.
DTH companies have been quick to grab this additional revenue have commenced charging carriage fee from practically every channel - FTA or Pay. The DTH platforms argue that each channel hogs expensive transponder capacity and uplink costs. They have therefore been demanding Carriage fees from practically every channel - FTA or Pay.
Broadcasters have tried to bundle their channels offered to DTH platforms with an "All Or Nothing" offer. Star first did this to DishTV and then Zee returned that condition to TataSky, when the later launched.
The matter went to the TDSAT, and now the government has established that DTH platforms are entitled to pick and choose the channels that they plan to deliver to their customers.

DTH Platforms Demand Rs 1 Crore Carriage Fees From Both
- FTA & Pay TV Channels

Industry insiders claim that TataSky and DishTV currently ask for a carriage of Rs 75 Lakhs to Rs 1.25 Crores per channel, irrespective of whether the channel is a pay channel or FTA.
Certain prime channels do get away without paying carriage fees, since the DTH platforms need these channels more than the channels need the DTH reach.
Less popular Pay channels are also imposed a carriage fee. The Pay TV subscriptions due to the broadcaster are initially adjusted against the carriage fee negotiated. Only after the broadcaster's subscription value exceeds the annual carriage fee, is the broadcaster paid anything.

DD Direct+ Charges A Carriage Fee Of Rs 25 Lakhs Per Indian Channel

For the past several years, Doordarshan's FTA Ku Band platform too has charged carriage fee, to offset the cost of transponder hire. When the DD Direct+ service was launched, free carriage was offered to all channel. As a result, free-to-air channels lined up for carriage on DD Direct+. A year later, DD Direct decided to charge a carriage fee of Rs 50 Lakhs per Indian channel and Rs 1 Crore per foreign channel. Many backed off. Today, DD Direct+ reaches an estimated 5 million homes i.e. as many as DishTV and TataSky put together. However, most of these are not in TRP cities, and low affluence households. DD Direct+ carries about 44 channels and charges a carriage fee of Rs 25 lakhs per year from Indian channels and Rs 50 lakhs per annum from International channels. The public broadcaster has now promised to increase its FTA channel bouquet to 100 channels, within the next 12 months.

DTH Carriage Fee Simply Offers Consumers An Option To Subscribe To A Pay Channel - Not Free Viewing

Carriage fee, whether on Doordarshan's free DTH service, DTH platforms or CATV is here to stay.
With over 72 million homes reached, CATV accounts for a lion's share of the reach. Recently, NDTV Imagine paid an estimated Rs 44 Crores as carriage fee for prime band placement of this channel, on large Cable TV networks, countrywide. Ofcourse, carriage on CATV networks guarantees a pay channel delivery into each of the CATV homes, while DTH carriage fee simply offers the consumer the option to subscribe to a pay channel. DTH carriage does not indicate that the DTH subscribers will actually receive the channel on their STBs.
The advent of Digital CATV, will provide huge channel bandwidth capacity on digital cable TV networks. Digital also does away with 'Prime Band' concerns, for channel carriage. With this reduce carriage fee ?
Satellite & Cable TV