Following in the footsteps of Network18, SunTV and Zee Entertainment Enterprises (ZEEL) Ltd, Culver Max Entertainment Pvt Ltd (previously Sony Pictures Network India) has announced a new Reference Interconnect Offer (RIO) that will be effective on February 1, 2024.As earlier reported by exchange4media,in the new RIO, some broadcasters have terminated some of their previous bouquets and launched new ones and have also modified the pricing of some channels. While some industry analysts believe that pricing changes are required as content costs are rising and advertising revenues are staying stagnant, others, however, fear that the price rise will cause further cord-cutting.According to Nitin Menon, co-founder and managing partner, NV Capital, given the slowdown in growth rates for advertising revenues in broadcasting and with the added pressure from the OTT space, the natural trajectory for the broadcasting industry would be to hike rates at least to help their bottom line in some form. “However, given that the existing cable homes are making the transition to Broadband, cord-cutting would continue to the existing base of cable and DTH homes."

He added that broadcasters who can arrest the trend of cord-cutting are those who make the transition to broadband seamlessly.

On the condition of anonymity, the distribution head of a leading television network shared that modification in prices will lead to an increase in subscription revenue basis MRP hike. He is also optimistic that it's likely that the agreed hike will be mutually negotiated between MSOs and the broadcasters.He said, “In my opinion, this is the end of an era for independent networks as it will be difficult for them to survive. There is a risk of cord-cutting as consumers seek more cost-effective alternatives such as streaming services, which could shape the industry's trajectory. The outcome is determined by the industry's capacity to react to these developments and fulfil consumer demands for both content and affordability.”A senior executive of a leading broadcaster shared that they have been supporting MSOs and DPOs for so long but they cannot always drive with the old regime and content costs are now skyrocketing.

He said, “DPOs never share the actual numbers. They say that they are losing subscribers every day. If so then why are they not reducing marketing or carriage fees? They do pitch two different subscriber bases for FTAs. They have a huge subscriber base and for pay broadcasters, the same has drastically dropped. Earlier there was the fix fee term but now that hardly exists. Because of this, revenue got compromised.”Distribution Platform Operators (DPOs), on the other hand, say that they are already bleeding subscribers and trying to battle competition from the mushrooming OTT space and the Internet. Every month, the number of recharges goes down as the subscribers consume content through OTT or other devices. Some say that they are surviving only because of broadband and the few news broadcasters that pay them marketing fees. The A-la-carte price of a few channels increased from Rs 3 to Rs 19.  Few DPOs are saying that they will put the channels on an A-la-carte basis, and won't opt for bouquet.

ZEEL, Network18, and Culver Max last updated their pricing in December 2022 after the Telecom Regulatory Authority of India (TRAI) amended the new tariff order (NTO). The other networks that had revised the pricing then were Sun TV, Discovery Communication India, Disney Star India, and Culver Max Entertainment. The revised RIOs were filed on December 16 and became effective on February 1, 2023.