The Union Cabinet on Wednesday approved revision in guidelines for providing direct to home (DTH) services in the country under which licenses would be issued for 20 years, Union minister Prakash Javadekar said.
The Union Cabinet has also approved 100 per cent FDI in the DTH broadcasting services sector, Javadekar said, adding that while the commerce ministry had spoken of 100 per cent FDI in the DTH sector, the guidelines of the information and broadcasting ministry needed to be changed.
“In India, more than six crore houses get DTH services. The commerce ministry had earlier decided 100 per cent FDI in DTH services but due to Information and broadcasting ministry's guidelines, the DTH services could not get that benefit.
“The new guidelines will be in sync with the commerce ministry's guidelines," the minister of information and broadcasting said at a press briefing.
“Till now, as per our guidelines, the FDI cap was limited to 49 per cent only but now it will be 100 per cent.
“Telecom Regulatory Authority of India (TRAI) has been consulted regarding the same.
“DTH services will also get licence for 20 years and renewal will be every 10 years,” he said.
According to the new revised guidelines for DTH services, the cap of 49 per cent FDl in the existing DTH guidelines will be aligned with the extant government (Department for Promotion of Industry and Internal Trade) policy on FDl as amended from time to time.
It said the license fee will be collected on quarterly basis in lieu of presently annual basis.
Welcoming the new guidelines, leading DTH player Tata Sky said the government's decision to grant licences to the operators for 20 years would provide certainty to the industry.
Currently, the licence is valid for 10 years for DTH players.
"We are grateful to (Information and Broadcasting Minister Prakash) Javadekar, for resolving the long-standing impasse on the DTH Licence policy which will provide certainty to the industry," Tata Sky managing director and chief executive officer Harit Nagpal told PTI.
However, he also said the DTH industry is looking at a level-playing field with the parity of licence fee with cable TV.
"We look forward to a level-playing field via parity of the licence fee with cable TV, which is also licensed by (the ministry of information and broadcasting) and follows the same prices and margins as regulated by Trai's NTO (new tariff order)," he said.
As per the guidelines, the license fee has been revised from 10 per cent of gross revenue (GR) to eight per cent of the adjusted gross revenue (AGR) which will be calculated by deduction of GST from GR, it said.
“The proposed reduction is intended to align the license fee regime applicable to the telecom sector and will be prospectively applied.
“The difference may also enable DTH service providers to invest for more coverage leading to increased operations and higher growth and thereby enhanced and regular payment of license fee by them,” the guidelines said.
It said the registration fee for platform services is likely to bring a revenue of approximately Rs 12 lakh.
“The amended DTH guidelines, with longer license period and clarity on renewals, relaxed FDI limits, etc. will ensure fair degree of stability and new investments in the DTH sector along with employment opportunities,” the ministry said.
According to the new guidelines, DTH operators shall be permitted to operate to a maximum of five per cent of its total channel carrying capacity as permitted platform channels.
A one-time non-refundable registration fee of Rs 10,000 per PS (platform service) channel shall be charged from a DTH operator, it said.
The guidelines also allowed sharing of infrastructure between DTH operators.
“DTH operators, willing to share DTH platforms and transport streams of TV channels, on a voluntary basis, will be allowed.
“Distributors of TV channels will be permitted to share the common hardware for their Subscriber Management System (SMS) and Conditional Access System (CAS) applications,” it said.
“Sharing of infrastructure by the DTH operators may bring in more efficient use of scarce satellite resources and reduce the costs borne by the consumers.
“Adoption of the extant FDI policy will bring in more foreign investment into the country,” it said.