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Challenges are mounting for Prasar Bharati as it nears the launch date of its over-the-top (OTT) platform, with cable TV operators and a handful of private broadcasters raising red flags and pushing for more clarity in the existing guidelines.
Prasar Bharati's move into the OTT space not only is poised to stir up competition for the other OTT players but is also distressing linear TV channels in the market as they seek holistic regulatory review because of the pubcaster’s ability to integrate its OTT with traditional TV offerings, potentially leading to market distortions.
As per a source close to the development, broadcasters are expected to actively lobby for regulatory changes over the next few weeks.
“Broadcasters are prepping their legal arsenals to challenge Prasar Bharati. Complaints, petitions, and a push for stricter separation of public vs. private sector ventures are all on the table”, an industry source told Storyboard18.
And the reasons are many, other than the obvious that almost all top broadcasters in the country today run their own subscription-based or ad-based OTT platforms like Zee5, Sony Liv, and Jio-Cinema.
For one, Prasar Bharati is not subject to TRAI regulations and the Cable TV Act since the Prasar Bharati Act grants autonomy to All India Radio and Doordarshan (DD). Secondly, the satellite TV channels can't ideally be part of Prasar Bharati's OTT platform because according to the Uplinking & Downlinking guidelines, satellite TV channels can only provide signals to registered DPOs or licensed service providers including MSOs, DTH, IPTV, and HITS operators.
The primary overlap between traditional TV distribution and OTT lies in how content is delivered to the audience. Traditional TV distribution uses means like satellite or cable to delivery live or scheduled content. This is governed by strict regulations like licensing, carriage fee, content guidelines etc. On the other hand, OTT platforms use the internet for delivering on-demand content which has more flexibility in delivery, user choice and less regulatory oversight as compared to traditional / satellite TV.
“When Prasar Bharati enters into OTT space it creates overlap where a public broadcaster content is available via both, traditional or internet route, both governed by different regulatory frameworks creating confusion and perceived unfairness. Perceived unfairness is on account of concerns around a not so-level playing field for private players vs Prasar Bharati,” highlights Shalabh Saxena, Partner, Grant Thornton Bharat.
Also, the issue lies in the ambiguity around whether the current guidelines, which are designed for satellite TV apply to digital platforms like OTT. There’s a lack of clarity on this, and Prasar Bharati’s OTT venture might push the boundaries of these regulations, necessitating a need for updated guidelines.
“Moreover, OTT platforms are built on a global distribution model, where content is available across regions without the same geographic and infrastructure constraints as satellite TV. Applying satellite uplinking and downlinking rules designed for linear TV could inadvertently stifle the innovation and flexibility that digital distribution offers. It could also lead to an uneven playing field for private broadcasters,” Saxena explains.
To be sure, it is not necessarily the question around violation of established rules but the blurring of lines that occurs because traditional rules don’t account for the on-demand nature, scalability, and accessibility of OTT platforms, which are significantly different from the linear, scheduled nature of satellite TV.
The recent letter to the Ministry of Information & Broadcasting (MIB) from the All India Digital Cable Federation (AIDCF) stems from similar concerns and further emphasises Prasar Bharati’s possible disruption into the traditional television ecosystem by bypassing established norms.
Also, “cable operators and private broadcasters are wary of increased competition, fearing that Prasar Bharati’s OTT platform may divert viewers from traditional distribution methods, thus threatening the revenue models based on subscriptions and advertising,” adds Siddharth Chandrashekhar, Advocate & Counsel, Bombay High Court.
A holistic regulatory review might be necessary to balance public and private interests.
“If the market isn’t carefully regulated, we might see broadcasters tapping out. Prasar Bharati’s OTT is the elephant in the room, and it’s sitting on the competition,” remarks Chandrashekhar.
The counter-OTT offensive broadcasters are likely to challenge Prasar Bharati’s move through regulatory petitions and lobbying, arguing that public funds give it an unfair advantage, he further shares.
“While there is a strong argument for Prasar Bharati to withdraw provisions that directly compete with private players, a balanced approach may involve clearer regulatory frameworks rather than a complete rollback,” he argues.
If broadcasters have their way, Prasar Bharati’s OTT might just be buffering indefinitely, say insiders.
The move is also likely to create unfair competition for traditional distribution channels like MSOs and DTH operators.
“Offering satellite TV channels on its OTT platform could undermine the business models of traditional distributors like MSOs and DTH operators. The absence of specific regulations for Prasar Bharati's OTT platform could create a situation where its activities are not subject to the same level of scrutiny as licensed service providers,” highlights Alpana Srivastava, Partner, Desai & Diwanji.
Broadcasters also fear that Prasar Bharati's access to content, including regional and local language content, could limit the availability of exclusive content for private broadcasters.
Further, the platform could divert viewers away from traditional television channels, negatively impacting the revenue of private broadcasters.
One of the broadcasters, however, highlighted the news channels are very gung-ho about the move and are very keen to onboard because to participate in DD Free Dish, they have to go through the auction process, which is not the case for the upcoming OTT.
Heating up the OTT space
Prasar Bharati's move into the OTT space is poised to stir up competition in India's streaming market where established players such as Netflix, Amazon Prime, and Disney+ Hotstar dominate.
With access to the extensive archives of DD and All India Radio, Prasar Bharati offers culturally rich and diverse regional content. This includes government-supported programs, educational material, and news, presenting a refreshing alternative to the entertainment-centric offerings of mainstream OTT platforms.
Additionally, leveraging its strong presence in rural areas and regions, Prasar Bharati is well-positioned to serve an underserved segment that many OTT platforms have overlooked. Offering content in regional languages could set it apart as a major differentiator, points out Jasmine Damkewala, Senior Partner at Circle of Counsels and advocate-on-record, Supreme Court of India.
It is to be noted that the Prasar Bharati OTT is said to be free-of-cost for the first few years.
“Should Prasar Bharati’s OTT service provide free or low-cost access (similar to DD Free Dish), it could attract a broad audience that finds paid streaming services expensive. This could potentially disrupt the pricing models of other major players,” Damkewala adds.
Further, supported by the government, Prasar Bharati could enjoy regulatory benefits, including favorable distribution and licensing policies, giving it an edge over purely private OTT platforms.
Prasar Bharti, last month introduced a 'Content Sourcing Policy' for linear channels and digital platforms, outlining procedures for sourcing and acquiring content. This includes commissioning of new programs or partnerships with external producers to obtain a continuous source of programs.
The OTT platform will be operating on a revenue-sharing basis, with content providers receiving 65% of the net revenue from subscription or transaction-backed content, while Prasar Bharati will retain 35%. The same revenue-sharing model will apply to the satellite channels onboarded to the platform. Advertisements on the OTT platform will be managed by Prasar Bharati, with any unsold ad inventory shared between Prasar Bharati and the broadcaster in a 65:35 ratio.
Eyeing the trophy
In pursuance of its OTT launch, Prasar Bharati has even established a Sports Rights Negotiation Committee (SRNC) to bid for and negotiate the rights to major sporting events and has jumped head-on into the competition.
It will be constituted with officers from the Sports Division, Finance Division, and Sales Division after the approval of CEO, Prasar Bharati. The officer in charge of the Sports Division shall be the Chairperson of the Committee.
Sports rights are often owned by the organisers, who only sell them through exclusive bidding and negotiating processes.
The pubcaster is likely to now participate in such bidding or may approach organisers for sourcing the rights of sporting events through negotiation.
It is to be noted that through the enactment of the Sports Broadcasting Signals (Mandatory Sharing with Prasar Bharti) Act, 2007, private broadcasters are required to share live feeds of events deemed to be of ‘national importance’ with DD, ensuring that every Indian could tune in without needing a pricey subscription.
Section 3(1) of the Act has ensured that no one was left out of the action, with DD broadcasting these feeds across its terrestrial network for free.
Marquee properties like the Indian Premier League (IPL) is not part of the 'games of national importance', as of now.
If, by any means, Prasar Bharati amends the Sports Act to include the word ‘digital’, the sports broadcasters or digital rights holders would also be required to share the feed with Prasar Bharati OTT— which according to the broadcasters will be the end of sports broadcasting and digital streaming in India.
Consequently, broadcasters also fear that the pubcaster can also amend what constitutes under 'the sports of national importance' to include some of the biggest sporting events like IPL and other commercial leagues.
However, at the moment, according to a senior official, there is no word out from Prasar Bharati’s side whether the government will amend the Sports Act or not.
Karan Taurani, SVP at Elara Capital, doesn't foresee Prasar Bharati's OTT as a threat in the OTT, especially in the sports business.
"I don't foresee enough amount of traction for its OTT, although the pubcaster might try to negotiate certain deals but a lot has to do with the user's experience point of view of the app, how it scales up, and the arrangements they have with BCCI because it is a hefty amount of money; and it is doubtful that Prasar Bharati would be able to operate sports content for free (alike Jio). Also, the OTT market is overcrowded, and only a small portion of the audience at the extremely low end might opt for Prasar Bharati's OTT because in the OTT business, you need a lot of investments in user experience, customer acquisition, and content quality- all put together," he points out.
At present, Disney Star holds four-year rights (2024-2027) for the International Cricket Council's (ICC's) tournaments which it committed for $3 billion, while Viacom18 secured media rights for the Board of Control for Cricket in India (BCCI)-run international and domestic matches for ₹5,963 crore over the next five years.
With Reliance Industries and The Walt Disney Company announcing a strategic joint venture worth a staggering $8.5 billion, merging Viacom18 and Star India- the new behemoth now controls 75-80% of the sports broadcasting market and a major pie of the streaming market in India.