DTH players have to give 8% of their annual revenues as licence fee

Tata Play, the Direct-to-Home (DTH) business of Tata Group, has written to the telecom regulator, seeking a licence fee for streaming service providers such Netflix and Amazon Prime.

Tata Play has said that while DTH players have to give 8 per cent of their annual revenues as licence fee, digital streaming operators, or OTT players, do not have to pay any such fee.

“DTH platforms, which distribute both pay and free-to-air (FTA) channels, just as MSOs of cable and HITS platforms, pay licence fee at the rate of 8 per cent of adjusted gross revenue (AGR), while the MSOs do not, despite being security cleared by MHA and licensed by the MIB. OTT platforms also carry most pay and FTA channels, in addition to original content, go direct to home, yet they are neither required to be licensed, nor pay any licence fee. Moreover, TRAI regulations are also not applicable to them. There is thus a significant disparity between the treatment meted out to the DTH operators against other operators, despite offering the same service,” said Tata Play in its submission to the Telecom Regulatory Authority of India.

Tata Play has requested to remove the discriminatory licence fee treatment being meted out to the DTH industry, and provide a level-playing field by reducing the fee from 8 per cent to 4 per cent for DTH players, and impose a 4 per cent revenue-share on other players, including OTT service providers.

“A 4 per cent licence fee may be imposed on all content distributors, cable, DTH or OTT, to bring about a level-playing field while not being too harsh a levy on cable. It would also be revenue neutral for the exchequer,” said Tata Play.

The Tata Group entity has also asked the regulator to exclude all revenues earned from non-licensed activities from the calculation of licence fee, as has been done by the Department of Telecom for the telecom operators. The DoT had recently announced that only revenue from telecom services would be considered to calculate annual revenue share ending a 15 year long dispute with telecom operators.

Published on June 12, 2022