Highlights:
1. TRAI has recommended to the Indian government to abolish the license fee for DTH operators from the financial year 2026-2027 in order to improve their long-term performance.
2. TRAI also suggests that the license fee for DTH operators should be gradually reduced to zero in the next three years.
3. The reason behind this recommendation is the decreasing number of direct-to-home (DTH) subscribers and the intense competition faced by DTH companies from other platforms.
4. As of March 2023, there are approximately 65.25 million active customers for DTH platforms in India.
5. TRAI has proposed reducing the current license fee from 8% to 3% for the next three years. Currently, private DTH operators pay more than 1,000 crores annually as license fee.
Scrapping of DTH license fee has been recommended by the Telecom Regulatory Authority of India (TRAI) in a letter to the government. TRAI suggests that the license fee for DTH operators should be abolished from the financial year 2026-2027, in order to enable them to perform well in the long term. Additionally, TRAI proposes that within the next 3 years, the license fee should be reduced to zero for DTH operators. TRAI states that DTH platforms should be considered similar to other regulated and unregulated distribution platforms such as Multi-System Operators (MSOs), Headend-in-the-Sky (HITS) operators, IPTV providers, DD Free Dish, and OTT services. Currently, these platforms do not pay any license fee to the government, and TRAI wants to bring Direct-to-Home (DTH) service under the same category.
The reason behind abolishing the license fee is the decreasing number of Direct-to-Home subscribers and intense competition from other platforms. Over the past few years, Direct-to-Home service has suffered due to the availability of DD Free Dish, Prasar Bharati’s free DTH platform, and OTT platforms. As of March 2023, there are approximately 65.25 million active customers of four DTH platforms.
In response to TRAI’s letter, a spokesperson from DishTV stated that the issue of DTH license fee has been pending for a long time. If the government decides to accept the recommendation, it will be beneficial for all. The spokesperson further mentioned that reducing the license fee to 3% from the current level of 8% for the next 3 years, as suggested by TRAI, will create a level playing field for DTH operators with other platforms. Currently, private DTH operators pay more than INR 1,000 crores annually as license fee.
And, TRAI’s recommendation to scrap the DTH license fee aims to support DTH operators in the long run and promote fair competition among different distribution platforms in India.
