After years of debate on the matter and resistance from broadcasters, cross-media rules may now be introduced soon.
The Telecom Regulatory Authority of India (Trai) on Wednesday recommended that a broadcaster should not control any distribution platform — cable, direct-to-home (DTH) broadcasting, headend in the sky (HITS), mobile TV. Also, a firm running a distribution platform should not control TV broadcasting, the regulator said in its recommendations on cross-media ownership.
Trai has defined control as more than 20% equity in an entity. That is, any entity which has been licensed for TV broadcasting or has more than 20% equity in a broadcasting firm, shall not have more than 20% equity in any distributor, and vice-versa.
The broadcasters and distribution entities, which are currently breaching the cross-media control criteria, should get three years for restructuring, according to the regulator.
Most large media groups will be required to restructure their operations because of their presence in many segments. These include Sun TV, Star, the Zee group and Network18.
Among those who would not be impacted by the new norms are NDTV and Sony.
Relatively new media players like Anil Ambani’s ADAG group and Bharti may also have to revise some of their plans as a result of the Trai recommendations. The ADAG group and Bharti, which recently launched their DTH operations, are believed to be keen on launching TV channels also. But, there’s nothing official about it yet.
Although the regulator has not come out with any recommendation on mergers and acquisitions so far, it has said that M&A guidelines for the sector may be worked out later to "prevent media concentration and creation of significant market power".
The Authority has recommended that no cross-ownership restrictions should be imposed across media and telecom sectors. "The issue should be reviewed after two years," Trai has said.
Trai’s recommendations follow the demands of the information and broadcasting (I&B) ministry. With elections round the corner, the I&B ministry is not likely to formulate any cross-media ownership rules in a hurry.