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Broadcasters can't own DTH, cable: Trai
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MUMBAI: The first serious brakes on cross-media ownership could be on in India with the Telecom Regulatory Authority of India (Trai) recommending that any entity which holds 20 per cent or more in a broadcasting company can't have more than 20 per cent in a media distribution company such as MSO (multi-system operator), cable TV operator, DTH (direct-to-home, HITS (Headend-In-The-Sky) and mobile TV.

If approved by the government, the regulations would upset big media houses like Essel Group and Sun Network who have interests spread over the broadcasting and distribution chain. Star also holds 22 per cent stake in MSO Hathway Cable & Datacom. Reliance ADAG, which runs a DTH service under Big TV, has announced plans of entering the broadcasting space under the entity of Big Broadcasting.

In its recommendations on cross-media ownership, the sector regulator, however, has given three years time for existing broadcasters who have control over distribution networks for restructuring their holdings.

On the issue of cross-ownership across telecom and media companies, Trai has said that the issue could be "reviewed after two years".

Additionally, Trai said that the current restrictions on the number of licenses by a single entity are "adequate for the time being".

On the issue of concentration of control/ownership across media, Trai said merger and acquisition guidelines for the sector may be issued to prevent media concentration and creation of significant market power after working out the required safeguards for horizontal and vertical integration.

The recommendations said there is no emerging threat of market failure because of cross-media control or ownership (Horizontal integration), but "necessary safeguards" should be put in place to ensure that plurality and diversity of views are maintained.

It said the I&B Ministry should undertake a detailed market study and analysis for identifying/determining the safeguards. The results of such analysis may be put in public domain and discussed before finalising the safeguards.

The I&B Ministry had on 22 May last year sought Trai's recommendations on the need for cross media and ownership restrictions in India for radio, broadcasting and print medias. It was clarified by the ministry that looking at the increasing trend of the print media entering into broadcasting sector, the Authority should also include this aspect while examining the need for any cross media restrictions vis-à-vis broadcast media.

Industry observers Indiantelevision.com spoke to, however, are seeking for more clarity before they can comment on the implications the regulations, if approved, could have on cross-media owners. Sun TV Network, for instance, does not hold any stake in Sun Direct, the DTH venture. The Marans are the promoters in both the ventures. Similarly. Zee Entertainment Enterprises Ltd (Zeel) has no stake in Essel Group-owned Dish TV (DTH) and Wire & Wireless India Ltd (MSO).

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