TRAI recommends cable market share restrictions to curb MSO monopolies

To curb dominance of a single player in the cable sector, broadcasting regulator TRAI has recommended restrictions on the market share that a single Multi System Operator can hold.

As per recommendations made by the broadcasting sector regulator, rules should be amended to ensure that market share of Multi System Operators (MSOs) is restricted up to 50 percent.

TRAI made the recommendations after I&B Ministry sought its advice saying that the cable TV distribution had been virtually monopolised by a single entity in some states.

In its recommendations, TRAI approved the Herfindahl-Hirschman Index (HHI) for measuring the level of competition or market concentration in a state.

The regulator said that to ensure that at least three MSOs of comparable size operate in a market, it would be desirable to restrict the building up of market share up to 50 per cent.

"The Authority recommends that the threshold value for any individual or 'group' entity contribution to the market HHI should be no more than 2,500," TRAI said.

TRAI has also said that rules should be amended to ensure that any merger or acquisition involving MSOs or LCOs should require its prior approval of the regulator. The decision on

any proposal, complete in all aspects, shall be conveyed within 90 working days, it said.

TRAI Chairman Rahul Khullar told reporters that virtual monopolisation of the market was not a pan-Indian problem but in certain states it had a serious dimension.

He said there were complaints that a particular channel was not shown if it did not toe a particular line. He said the issue was a complex one and involved a web of "power, money and politics".