TRAI warns DPOs to complete annual system audits by Dec 31 or face penalties

The Telecom Regulatory Authority of India (TRAI) has issued a fresh compliance notice to Distribution Platform Operators (DPOs) — including multi-system operators (MSOs), IPTV, DTH, and HITS players — directing them to complete their annual system audits by December 31, 2025, or face financial disincentives under the Interconnection Regulations, 2017.

The directive, issued on October 31, 2025, comes after the regulator observed widespread delays among DPOs in conducting mandatory audits for the current calendar year, as required under Regulation 15(1) of the Interconnection Regulations.

According to TRAI, “many DPOs have not caused audit of their systems for the calendar year 2025 so far,” despite multiple reminders and the availability of empanelled auditors and BECIL (Broadcast Engineering Consultants India Limited) for the process.

“This is a compliance issue that has been repeatedly flagged,” said an industry executive familiar with the matter. “The regulator’s tone this time signals a stricter stance, especially with the year-end deadline clearly specified.”

Under the Interconnection Regulations, each distributor of television channels is required to undergo an independent audit every year to ensure accuracy of subscriber reports, adherence to technical standards, and proper content protection systems. Non-compliance can attract financial penalties under sub-regulation (1A) of Regulation 15.

A senior executive at a major broadcasting network said the audits are crucial for revenue transparency and revenue sharing across stakeholders.

“System audits help identify under-reporting of subscribers, which directly affects broadcasters’ revenues,” the executive noted. “Delays in these audits create opacity in the ecosystem, and broadcasters have been pushing TRAI to ensure tighter compliance.”

The 2017 Interconnection Regulations — notified on March 3, 2017, and subsequently amended in 2019, 2020, 2021, 2022, 2023, and 2024 — govern commercial and technical arrangements between broadcasters and distributors in India’s television ecosystem. They are considered central to maintaining transparency and uniformity in the distribution of television channels.

A senior official at a large MSO, however, said logistical and administrative challenges have slowed the audit cycle this year.

“There are practical difficulties — empanelled auditors are limited, and the process is time-consuming, especially when systems have undergone upgrades or mergers,” the person said, adding that some operators have sought more flexibility from the regulator.

Nonetheless, TRAI’s latest notice leaves little room for further delays. It explicitly directs DPOs to complete the entire audit process — including issuance of final reports — by December 31, 2025, “positively,” to avoid imposition of financial disincentives.

Industry insiders said the notice comes amid TRAI’s broader effort to tighten compliance in the broadcasting and cable services sector, as the regulator looks to ensure that audits, subscriber management systems, and content reporting mechanisms are robust and tamper-proof.

“The regulator has been consistent in saying that data integrity is the foundation for fair revenue distribution,” said another broadcasting executive. “This move is part of a larger cleanup of the value chain.”

Industry experts expect most operators to complete their audits within the stipulated timeline, though smaller MSOs may face capacity constraints.

“Smaller operators often lack dedicated compliance teams,” an analyst tracking the sector said. “But with financial penalties on the line, the pressure to meet the December deadline will be significant.”

With the year-end fast approaching, TRAI’s directive effectively puts the broadcasting distribution industry on notice — warning that continued laxity could invite punitive action as the regulator moves to reinforce transparency and accountability across India’s pay-TV ecosystem.