TRAI-ing television

Karl Marx termed religion as the opiate of the masses. He obviously did not foresee the advent of television. Its impact on the quality of life has never been so strikingly demonstrated as by the enormous heat generated by the introduction of the Conditional Access System (CAS).

In a country where governments routinely get away with the non-delivery of water, food, education and health, the prospect of paying more for, or losing, their favourite channels has incensed and energised citizens; the government has reacted to this anger by abandoning the rollout of CAS and bringing the cable-satellite television industry under the regulatory purview of the Telecom Regulatory Authority of India (Trai). Are these good decisions from the viewpoint of the consumer?

In hindsight, the problem with the implementation of CAS was not in the nature of the arrangement itself; it was essentially in the pricing model which the government agreed to. Charging individual subscribers for watching specific channels makes eminent sense from both the broadcasters' and consumers' point of view.

Broadcasters can design their content to suit their viewers' preferences by profiling them. Viewers, who don't want pay channels no longer need subsidise those who do. But the benefits of the system are critically dependent on who owns the set-top boxes. They must be owned by the providers of the service.

As soon as the subscriber is required to buy the box from a particular provider, he is locked in. If he changes either location or provider, his box has only ornamental value. This is patently anti-competitive. The reaction of consumers was completely understandable.

The decision to bring the industry under regulatory purview must be seen at two levels. At one level, the government is attempting to provide some reassurance to the viewing public that it is concerned with their welfare; that, regardless of its role in the CAS fiasco, it now wants to ensure that they get the best deal.

But, granting for a moment the desirability of regulation, is Trai the right choice? There are two reasons why it might be. First, as in the telecom sector, television requirements are going to be provided by at least three distinct technologies: the existing satellite-cable combination and the incipient direct-to-home (DTH) satellite services as well as services based on broadband networks.

Trai has recently had to grapple with issue of multiple technologies, so it can very likely transfer this expertise to the television industry.

Second, and related, the broadband services will be provided by large telecom players as they seek to diversify their service portfolios to spread their costs. These are already under Trai's purview.

But, at the same time, given the intimacy with which television apparently affects people's lives, there must be strict limits imposed on the regulatory domain. The prospect of a self-righteous regulator deciding what is and isn't acceptable for people to watch is only too real.