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To
All DTH Operators


Subject: Tariff issues for cable TV services in non-CAS Areas- Format for
submission of information...
4.           TRAI has appointed M/s Ernst & Young to assist TRAI in this exercise.
Ms. Chanpreet Arora, Manager, M/s Ernst...
Format for submission of information: DTH Operator

Name of the DTH Operator:                              _______________...
3.    Revenue

#            Information Area                          2006-07           2007-08                 2008-09
3....
- Cost Price of STB + Receiving
         Dish
         - Sale Price of STB + Receiving
         Dish (Use average over yea...
7.     Ownership Structure

      7.1 What is your parent company?
      _________________________________

      7.2 Do y...
II. Factors Affecting Key Receivables/ Pay-outs from the Distribution Supply Chain

Revenue from Subscribers

1.  How do y...
□      Lump sum payment
      □      Other factors, please specify __________________________


9. What factors drive you ...
___________________________________________________________________________
      _
             _________________________...
□     Tariff Regulation
      If yes, through what mechanism
      _______________________________________________________...
Appendix A: Details of Subscription Revenue across Different Regions
Please provide us details of your subscriber base acc...
#      Name of Bouquet/                  If bouquet,                    2006-07                                           ...
Appendix C: Carriage, placement and technical fee currently being collected from the broadcasters
Please indicate the pric...
Appendix D: Details of Programming Costs paid to Broadcaster
We would like to understand the cost of purchasing content an...
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Format for submission of Information : Direct To Home (DTH ...

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Format for submission of Information : Direct To Home (DTH ...

  1. 1. To All DTH Operators Subject: Tariff issues for cable TV services in non-CAS Areas- Format for submission of information to facilitate the consultation process Sir, The Hon’ble Supreme Court vide its order dated 13th May, 2009 has directed The Telecom Regulatory Authority of India (TRAI) to carry out a de novo tariff exercise for cable TV services in non-CAS areas. 2. In order to carry out this exercise, TRAI solicits your cooperation in supplying the information requested in the format attached to this letter. You are requested to download the format and provide information to TRAI on or before 1700 hours on Monday 17th August, 2009. Please use extra sheets where requested (or if required by you) to submit the information. The duly filled format should be submitted by email to bcs@trai.gov.in. Please provide the required information in two copies. The first copy should be provided in Acrobat PDF or any other un-editable format. The second copy should be submitted in an editable Microsoft Word or Microsoft Excel format to enable us to process this information in electronic form. The Hon’ble Supreme court in the said order has also directed all the stakeholders to co-operate with TRAI in this exercise. We request your cooperation in providing this information in time. 3. TRAI understands that some of the information to be supplied could be sensitive in nature. Such data as you desire will be kept confidential and will be used for the purpose of this exercise by TRAI. You may please indicate the data that is to be kept confidential. Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 1 of 14
  2. 2. 4. TRAI has appointed M/s Ernst & Young to assist TRAI in this exercise. Ms. Chanpreet Arora, Manager, M/s Ernst & Young (EY) may contact you in this regard. 5. If you require any help or clarification regarding any item in the format, please do not hesitate to contact us at the following: Phone: +91 11 23218918/23237922 Fax: +91 11 2322 0442 Email: bcs@trai.gov.in or trai.noncas@gmail.com (please indicate “Information regarding Tariff issues for Cable TV Services in Non-CAS Areas” in the subject line of your email) 6. Given the limited time frame to complete this exercise, we look forward to your prompt reply. Thanking You, Yours faithfully, (Subodh Kumar Gupta) Advisor (B&CS) August 07, 2009 Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 2 of 14
  3. 3. Format for submission of information: DTH Operator Name of the DTH Operator: ___________________________ Name of contact person: ___________________________ Designation: ___________________________ Date of filling in questionnaire: ___________________________ I. Business Model Please provide us the following information so we can understand your business better: 1. General Information # Information Area 2006-07 2007-08 2008-09 1. Total number of channels that your DTH service deals with 1.1 Number of pay channels Number of FTA channels Number of Active/ VOD channels 1.2 Number of digital channels 1.3 Please elaborate on the Value Added Services provided _____________ _____________ _____________ _____________ 1.4 Total number of connections Single subscriber units Multi-dwelling units (MDUs) 2. Audited Results and Annual Reports for the company’s operations for FY2006-07, FY 2007-08 and FY 2008-09 or from the year of existence (if less than three years). Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 3 of 14
  4. 4. 3. Revenue # Information Area 2006-07 2007-08 2008-09 3. Total Revenue 3.1 Subscription Revenue Please provide further details as requested in Appendix A and Appendix B 3.2 Advertisement Revenue 3.3 Revenue from Value Added Services 3.4 Carriage, Technical and Placement fees Please provide further details as requested in Appendix C (i) Carriage fee collected from broadcasters (ii) Technical fee collected from broadcasters (iii) Placement fee collected from broadcasters 3.5 Any other sources of revenue, please specify _______________ _______________ 4. Operating Costs # Information Area 2006-07 2007-08 2008-09 4. Total Operating Costs (note please apportion manpower costs to the relevant functional cost) 4.1 Programming Costs Please provide further details as requested in Appendix D (i) Number of pay channels purchased (iii) + (v) (ii) Number of bouquets purchased (iii) Number of pay channels purchased in bouquets (iv) Number of FTA channels present in these bouquets (if any) (v) Number of pay channels purchased a la carte (vi) Total number of pay channels carried/transmitted on the network (vii Any variation between pay ) channels purchased and transmitted (i) and (vi) 4.2 Technology and Transmission Costs (please provide a break-up as follows) (i) Dish farm (ii) Servers, routers, multiplexers, encoders, etc. (iii) Transponder annual leasing cost (iv) Teleport Cost (v) Set Top Box (STB) + Receiving Dish Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 4 of 14
  5. 5. - Cost Price of STB + Receiving Dish - Sale Price of STB + Receiving Dish (Use average over year and different price plans if necessary) (vi) Subscriber Management System (vii Any Other Major Technology ) Costs that cannot be allocated in above fields, please specify _____________ _____________ 4.3 Customer Servicing Costs (i) Call centre (ii) Technical and repairs team (iii) Others, please specify _____________ 4.4 Overheads 4.5 Any Other Costs, Please specify ______________ ______________ 5. Profitability and Returns # Metric 2006-07 2007-08 2008-09 5.1 EBITDA Margin 5.2 EBIT 5.3 PAT 5.4 Capital Expenditure Undertaken 5.5 ROCE 5.6 ROI 6. Key Investments # Information Area Last 18 months (preceding Next 18 months (following 01 01 July 2009) July 2009) 6.1 Major investments for upgrading infrastructure and expansion of servicing network (i) Head end at the Teleport station (ii) Technology costs incurred in adding to the number of channels provided (iii) Customer Servicing : SMS, CRM, Billing systems, Call center infrastructure 6.2 Sources of Funding (i) Equity (ii) Debt (iii) Technical/ Carriage Fee from Broadcasters (iv) Internal Accruals (v) Other sources Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 5 of 14
  6. 6. 7. Ownership Structure 7.1 What is your parent company? _________________________________ 7.2 Do you have 20% or more stake in the following sectors? □ Television Broadcast Please specify the total number of channels operated by the parent______________________ □ Distribution – MSO Please specify reach of MSO network (number of connections1) Please specify markets of presence ______________________ □ Distribution – LCO Please specify reach of LCO network (number of connections) Please specify markets of presence ______________________ □ Distribution – DTH (other than this company) Please specify reach of DTH network (number of connections) Please specify markets of presence ______________________ □ Distribution – IPTV Please specify reach of IPTV network (number of connections) Please specify markets of presence ______________________ □ Any other broadcasting and distribution related sectors Please specify_______________________________________ 7.3 Do any of your shareholders who have 20% or more stake in your company have 20% or more stake in the following sectors? □ Television Broadcast Please specify the total number of channels operated by the parent______________________ □ Distribution – MSO Please specify reach of MSO network (number of connections2) Please specify markets of presence ______________________ □ Distribution – LCO Please specify reach of LCO network (number of connections) Please specify markets of presence ______________________ □ Distribution – DTH (other than this company) Please specify reach of DTH network (number of connections) Please specify markets of presence ______________________ □ Distribution – IPTV Please specify reach of IPTV network (number of connections) Please specify markets of presence ______________________ □ Any other broadcasting and distribution related sectors Please specify_______________________________________ 1 Connections = subscribers 2 Connections = subscribers Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 6 of 14
  7. 7. II. Factors Affecting Key Receivables/ Pay-outs from the Distribution Supply Chain Revenue from Subscribers 1. How do you determine the pricing and packaging for various bouquets. Please explain the components of the ARPU and the methodology used for determining the price. __________________________________________________________________________________ __________________________________________________________________________________ __________________________________________________________________________________ ___ 2. What are the determinants of package and channel pricing? Please tick as applicable. □ Price at which individual channels are purchased □ Price at which bouquets are purchased □ Other factors, please specify __________________________ Negotiation of Carriage and Placement Fee with Broadcasters 3. Do you current charge any form of carriage, placement or technical fees from broadcast networks? Please tick as applicable and elaborate. □ Yes, why __________________________ □ No, why __________________________ 4. How do you determine the carriage, placement and technical fee to be charged from the broadcaster? __________________________________________________________________________________ __________________________________________________________________________________ 5. To what degree do prices vary for placement within the genre-wise catalogue of channels provided? (Please refer to Annexure C for details on what are the placement costs currently being collected) __________________________________________________________________________________ __________________________________________________________________________________ 6. Do you incur any costs when you add a new channel to your service? Please elaborate on the expense heads and the approximate value of each. __________________________________________________________________________________ __________________________________________________________________________________ 7. Are you currently facing any capacity related or technical constraints for adding new channels to your service? Please elaborate on these challenges and how their impact may be reduced. __________________________________________________________________________________ __________________________________________________________________________________ Content Costs 8. How do you determine the total programming cost (wholesale price) to be paid to different channels? Please explain which negotiation mechanism you use (tick all that apply) and the benefits of each. □ Revenue share □ Minimum guarantee Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 7 of 14
  8. 8. □ Lump sum payment □ Other factors, please specify __________________________ 9. What factors drive you to purchase channels in bouquets vs. a la carte? __________________________________________________________________________________ _ __________________________________________________________________________________ _ __________________________________________________________________________________ _ __________________________________________________________________________________ _ 10. Are there any instances in which you have purchase a channel as part of a bouquet but not transmitted it? □ Yes, why __________________________ □ No __________________________ III. Challenges Faced in the Current Market Conditions 1. Highlight the key businesses issues related to distribution that your company is dealing with today? Please elaborate on the perceived cause of the issue and its impact on business operations. __________________________________________________________________________________ _ __________________________________________________________________________________ _ __________________________________________________________________________________ _ __________________________________________________________________________________ _ 2. Do you believe that there is a level playing field for DTH services vis-à-vis incumbent platforms like analog cable? Why or why not? Please elaborate. __________________________________________________________________________________ _ __________________________________________________________________________________ _ __________________________________________________________________________________ _ __________________________________________________________________________________ _ 3. What key market constraints (outside the influence of the individual companies) impact business operations? □ Regulation, please give specific instances: ___________________________________________________________________________ _ ___________________________________________________________________________ _ □ Market Practices prevalent in the business amongst other stakeholders. Please provide specific actions: Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 8 of 14
  9. 9. ___________________________________________________________________________ _ ___________________________________________________________________________ _ IV. Proposed Solutions 1. What are your expectations from other stakeholders in the value chain? □ Broadcaster __________________________ □ Consumer __________________________ □ Aggregator __________________________ □ Other Distributors (MSOs, LCOs) __________________________ 2. How can this be operationalised? __________________________________________________________________________________ _ __________________________________________________________________________________ _ 3. What resources can you and your stakeholder group commit, if any in the future for improving the current market conditions? __________________________________________________________________________________ _ __________________________________________________________________________________ _ 4. What is the desired level of intervention from the TRAI? Tariff Regime □ Case for forbearance If yes, what checks & balances do you recommend: ____________________________________________________________________________ □ Regulate carriage/placement fee If yes, through what mechanism ____________________________________________________________________________ Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 9 of 14
  10. 10. □ Tariff Regulation If yes, through what mechanism ____________________________________________________________________________ Non-Tariff Related □ Encouraging digitization If yes, through what mechanism ____________________________________________________________________________ □ Any other factor ____________________________________________________________________________ Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 10 of 14
  11. 11. Appendix A: Details of Subscription Revenue across Different Regions Please provide us details of your subscriber base according to regional offices, and the revenue per subscriber collected in each region # City / State 2006-07 2007-08 2008-09 Actual Number of ARPU Actual Number of ARPU Actual Number of ARPU Connections Connections Connections Appendix B: Details of Subscription Revenue by Bouquet/ Channel Please provide us details of the effective price charged to the consumer by bouquet and channel Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 11 of 14
  12. 12. # Name of Bouquet/ If bouquet, 2006-07 2007-08 2008-09 Channel names of A. Total B. Total C. Effective A. Total B. Total C. Effective A. Total B. Total C. Effective constituent subscription number of price per subscription number of price per subscription number of price per channels revenue of connections channel/ revenue of connections channel/ revenue of connections channel/ collected to whom this bouquet collected to whom this bouquet collected to whom this bouquet channel/ (A/B) channel/ (A/B) channel/ (A/B) bouquet is bouquet is bouquet is delivered delivered delivered Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 12 of 14
  13. 13. Appendix C: Carriage, placement and technical fee currently being collected from the broadcasters Please indicate the price that you are currently charging for the following channels. If possible please indicate these elements separately as C, P and T. # Channel Channel Name Genre – FTA / Carriage/ # Channel Channel Genre - on FTA / Pay Carriage/ Number on your Pay Placement/ Number on Name your Placement/ on DTH platfor Technical DTH Service platform Technical Service m Fee Fee 1 22 2 23 3 24 4 25 5 26 6 27 7 28 8 29 9 30 10 31 11 32 12 33 13 34 14 35 15 36 16 37 17 38 18 39 19 40 20 41 21 42 Please add more sheets if required Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 13 of 14
  14. 14. Appendix D: Details of Programming Costs paid to Broadcaster We would like to understand the cost of purchasing content and the subscriber base on which the broadcaster is remunerated # Name of Name of Revenue Model 2006-07 2007-08 2008-09 Bouquet/ constituent Agreed with Total % revenue Number of Total % revenue Number of Total % revenue Number of Channel if channels or N/A Broadcaster remuneration share connections remuneration share connections remuneration share connections purchased a la if purchased a la (Lump Sum or paid to the corresponding to delivered paid to the corresponding to delivered paid to the corresponding to delivered against carte carte Revenue Share) broadcaster this amount (if against this broadcaster this amount (if against this broadcaster this amount (if this on rev share remuneration on rev share remuneration on rev share remuneration basis) basis) basis) Format for submission of information: DTH Operators 7th August 2009 Tariff issues for cable TV services in non-CAS areas Page 14 of 14

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