SC refuses interim relief to broadcasters challenging Bombay HC’s NTO verdict

The Supreme Court on Wednesday refused stay on Bombay high court’s order, which upheld most provisions of the new tariff order (NTO) issued by the Telecom Regulatory Authority of India (Trai) in 2017 and 2020, which mandated individual pricing for television channels and recommended caps.

A bench comprising Chief Justice of India N.V. Ramana, Justice Surya Kant and Justice Aniruddha Bose, however, issued notice on the special leave petitions filed by broadcasters, and has next listed the matter for hearing on 7 September.

“It essentially means the court has said they see merit in entertaining our appeal but has not granted us relief in case Trai takes coercive action to force us to migrate from the 2017 to the 2020 NTO regime,” said Abhishek Malhotra, managing partner, TMT Law Practice that is representing the broadcasters. The order has thrown broadcasters, who were hoping for interim relief, in a limbo and they are evaluating what to do next, Malhotra added.

Media experts, however, point out that the order, in a way, paves the way for NTO 2.0 to come into force. The Indian Broadcasting Foundation (IBF), a unified representative body of television broadcasters in India, had moved the Bombay high court against Trai’s amended NTO soon after it came out in January 2020. Meanwhile, the telecom regulator had filed caveats in all major high courts against issuing a stay without hearing what it has to say in the matter. Broadcasters that had come together under the IBF umbrella to take on Trai, included Star India, Zee Entertainment Enterprises Ltd, and Sony Pictures Networks. The IBF had later moved the Supreme Court against the Bombay high court’s verdict in July.

According to the NTO, consumers could choose the TV channels they want to watch and pay only for them at maximum retail prices (MRPs) set by broadcasters, instead of the pre-set bouquets offered earlier. The new tariff order was expected to make channels cheaper for the consumer and offer more choice.

But when total outgo of like-to-like channels went up, Trai announced amendments to the NTO on 1 January 2020. As part of the new amendments, Trai reduced the cap on the MRP of individual channels, which can form part of any bouquet, to ₹12 from ₹19 per month, which the IBF said had not been backed by any logical rationale or consumer insight. The regulator also sought to impose twin conditions for bouquet formation, effectively introducing a cap on bouquet pricing, which broadcasters felt would limit the number of channels in the bouquet and reduce the value delivered to consumers.

By upholding most provisions of NTO 2.0, though it did strike down one of the pricing conditions, media experts said the Bombay high court judgment would essentially compel broadcasters to either lower prices of channels offered on a la carte basis or reduce the number of channels they offer as part of a bouquet. The resultant possible shift by customers to a la carte channels (because of lower prices) would lead to greater precedence for mass-driven channels and not bode well for niche, English language or infotainment genres. LiveMint