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2014 Supreme(Online)(TDSAT) 82
TELECOM DISPUTES SETTLEMENT AND APPELLATE TRIBUNAL
Aftab Alam, CJ, Kuldip Singh, J
Star Sports India Pvt. Ltd. – Appellant
Versus
Hathway Cable & Datacom Ltd. – Respondent
Petition No. 47 (C) of 2014|Petition No. 210(C) of 2014|Petition No. 214(C) of 2014|Petition No. 319(C) of 2014|Petition No. 335(C) of 2014
For the Appellants/Petitioners:Mr. Rakesh Dwivedi, Sr. Advocate, Mr. Saikrishna Rajagopal, Advocate, Mr. Gopal Singh, Advocate, Mr. Saurabh Srivastava, Advocate, Mr. Sidharth Chopra, Advocate, Ms. Shilpa Gupta, Advocate
For the Respondents:Mrs. Prathiba M. Singh, Sr. Advocate, Mr. Tejveer Singh Bhatia, Advocate, Mr. Upender Thakur, Advocate
The regulation mandates fairness, transparency, and non-discrimination in interconnection agreements between broadcasters and multi-system operators.
Headnote:(A) Telecommunication (Broadcasting & Cable Services) Interconnection (Digital Addressable Cable Television Systems) Regulations, 2012 - Clause 5(16) - Dispute between multi-system operator and broadcasters over fee structures following expiration of previous agreements - Issues included whether new a-la-carte agreements could apply retroactively - Sought to ensure fairness in interconnections and prevent discrimination. (Paras 1-2, 5.1, 5.2, 5.3, 7.1-7.8)
(B) Fairness in Negotiations - Regulatory mandates necessitate reasonableness and non-discrimination in contract terms between broadcasters and multi-system operators. The pressing need for remedial measures from the regulator was underlined due to discrepancies in fee structures across different distributors. (Paras 7.9-7.10)
Facts of the case:
The petitions arise from a dispute involving disparate treatment of MSOs regarding subscription rates and agreements with broadcasters, with notable market pressures influencing negotiations amidst existing regulations. Challenges included an alleged breach of non-discrimination principles under the Regulations, as well as unilateral decisions for fee increases by Star relative to competitors. (Paras 4-7)
Findings of Court:
The court directed execution of interconnect agreements based on the Reference Interconnect Offer, while clarifying the pricing structure for subscriber fees during transitional periods between agreements, asserting a need for equitable engagements by the parties. (Paras 8-9)
Issues: Determination of whether the new a-la-carte agreement terms would apply retroactively and if fair practices were upheld in interconnections with differing fee structures for similar services. (Paras 10-12)
Ratio Decidendi: The court held that the transitional application of new fee structures must align with principles of fairness and non-discrimination, thus entitling both parties to renegotiate under consistent terms reflective of their past engagements. (Paras 13-14)
Result: The court mandated that both sides execute new interconnect agreements by 30 September 2014 and established provisional fees applicable during the interim period. (Paras 15-17)
ORDER
By Aftab Alam, Chairperson –
This batch of cases arises from disputes between a big multi-system operator on the one side and some major broadcasters and/or their agent-intermediary on the other. An interesting feature of the case is that the disputes between the two sides seem to be growing and changing shades with time; as the focus shifts from one to the other issue, even new issues seem to arise and the two sides keep adjusting their positions accordingly. This was evidenced, as we shall see at the appropriate stage in this judgment, even in the course of the hearing of the case which was spread over several days. Hence, we recount the facts in the order in which these petitions came before us, following the development of the disputes between the two sides.
Petitions nos. 47 (C) of 2014, 210 (C) of 2014 and 214 (C) of 2014:
Hathway and Star Sports:
M/s Hathway Cable & Datacom is a multi-system operator (MSO). It is one of the largest MSOs in the country. Earlier it was getting the Star Sports group of channels under an agreement with ESPN, [Later name changed to ‘Star Sports’] Software India Pvt. Limited. Hathway’s agreement with ESPN was in the form of a Term Sheet dated 21 August 2012, the term of which was from 1 November 2012 to 31 October 2013. In terms of this agreement, Hathway received five channels,
The previous agreement between the two sides was on a fixed fee basis.
Hence, Hathway found it profitable to put as many (or as few) of the Star Sports channels in its bouquets as best suited its marketing policy, without incurring any increase in the monthly subscription payable to Star Sports. But after switching over to a-la-carte rates, it simultaneously withdrew all Star Sports channels from all its bouquets and began to offer each Star Sports channel to ordinary subscribers only on a-la-carte basis. The sudden withdrawal of the channels from all Hathway’s bouquets made Star Sports imagine that its channels were being completely blacked out by Hathway. Star Sports, accordingly, came to the Tribunal in Petition no. 47 (C) of 2014, [3Filed on 4 February 2014.] making the grievance that Hathway had taken off air all its channels in Delhi and Mumbai without following legal procedure. Hathway denied that it had taken the Star Sports channels off air and it explained that it had simply withdrawn
