Telecom Regulatory Authority of India A-2/14, Safdarjung Enclave, New Delhi 110029 NOTIFICATION File NO: 8-26/2004-B&CS Dated: 10th December, 2004 In exercise of the powers conferred upon it under section 36, and paras (ii), (iii) and (iv) of clause (b) of sub-section (1) of section 11 of the Telecommunication Authority of India Act, 1997 read with the Notification No.39 (S.O No. 44 (E) and 45 (E))dated 09.01.2004 issued from file No.13-1/2004-Restg by the Government of India under clause (d) of sub-section (1) of Section 11 and proviso to clause (k) of sub section (1) of the Section 2 of the Telecom Regulatory Authority of India Act, 1997, the Telecom Regulatory Authority of India makes the following Regulation, namely:
1. Short title, extent and commencement:
(i) This regulation shall be called “The Telecommunication (Broadcasting and Cable Services) Interconnection Regulation 2004” (13 of 2004) (The Regulation).
(ii) This regulation shall cover arrangements among service providers for interconnection and revenue share, for all Telecommunication (Broadcasting and Cable) Services throughout the territory of India.
(iii) This regulation shall come into force with effect from the date of its publication in the Official Gazette.
2. Definitions:
In this regulation, unless the context otherwise requires:
(a) ‘addressable system” means an electronic device or more than one electronic device put in an integrated system through which signals of cable television network can be sent in encrypted or unencrypted form, which can be decoded by the device or devices at the premises of the subscriber within limits of the authorization made, on the choice and request of such subscriber, by the distributor of TV channels to the subscriber;
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(b) “agent or intermediary” means any person including an individual, group of persons, public or body corporate, firm or any organization or body authorised by a broadcaster/multi system operator to make available TV channel(s), to a distributor of TV channels;
(c) “authority” means the Telecom Regulatory Authority of India established under sub-section (1) of section 3 of the Telecom Regulatory Authority of India Act;
(d) “authorized officer” has the same meaning as given in the sub-section (a) of the Section 2 of the Cable Television Networks (Regulation) Act, 1995, as amended;
(e) “broadcaster” means any person including an individual, group of persons, public or body corporate, firm or any organization or body who/which is providing broadcasting service and includes his/her authorised distribution agencies;
(f) “broadcasting services” means the dissemination of any form of communication like signs, signals, writing, pictures, images and sounds of all kinds by transmission of electro magnetic waves through space or through cables intended to be received by the general public either directly or indirectly and all its grammatical variations and cognate expressions shall be construed accordingly;
(g) “cable operator” means any person who provides cable service through a cable television network or otherwise controls or is responsible for the management and operation of a cable television network;
(h) “cable service” means the transmission by cables of programmes including re-transmission by cables of any broadcast television signals;
(i) “cable television network” means any system consisting of a set of closed transmission paths and associated signal generation, control and distribution equipment designed to provide cable service for reception by multiple subscribers;
(j) “distributor of TV channels” means any person including an individual, group of persons, public or body corporate, firm or any organization or body re-transmitting TV channels through electromagnetic waves through cable or through space intended to be received by general public directly or indirectly. The person may include, but is not limited to a cable operator, direct to home operator, multi system operator, head ends in the sky operator;
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(k) “direct to home operator” means an operator licensed by the central government to distribute multi channel TV programmes in KU band by using a satellite system directly to subscriber’s premises without passing through intermediary such as cable operator or any other distributor of TV channels;
(l) “head ends in the sky operator” means any person permitted by the central government to distribute multi channels TV programmes in C band by using a satellite system to the intermediaries like cable operators and not directly to subscribers;
(m) “multi system operator” means any person who receives a broadcasting service from a broadcaster and/or their authorized agencies and re-transmits the same to consumers and/or retransmits the same to one or more cable operators and includes his/her authorised distribution agencies.
(n) “service provider” means the Government as a service provider and includes a licensee as well as any broadcaster, multi system operator, cable operator or distributor of TV channels.
3. General Provisions relating to Non-Discrimination in Interconnect Agreements
3.1 No broadcaster of TV channels shall engage in any practice or activity or enter into any understanding or arrangement, including exclusive contracts with any distributor of TV channels that prevents any other distributor of TV channels from obtaining such TV channels for distribution.
3.2 Every broadcaster shall provide on request signals of its TV channels on non-discriminatory terms to all distributors of TV channels, which may include, but be not limited to a cable operator, direct to home operator, multi system operator, head ends in the sky operator; Multi system operators shall also on request re-transmit signals received from a broadcaster, on a non-discriminatory basis to cable operators.
Provided that this provision shall not apply in the case of a distributor of TV channels having defaulted in payment.
Provided further that any imposition of terms which are unreasonable shall be deemed to constitute a denial of request
3.3 A broadcaster or his/her authorised distribution agency would be free to provide signals of TV channels either directly or through a 3 particular designated agent or any other intermediary. A broadcaster shall not be held to be in violation of clauses 3.1 and 3.2 if it is ensured that the signals are provided through a particular designated agent or any other intermediary and not directly. Similarly a multi system operator shall not be held to be in violation of clause 3.1.and
3.2 if it is ensured that signals are provided through a particular designated agent or any other intermediary and not directly.
Provided that where the signals are provided through an agent or intermediary the broadcaster/multi system operator should ensure that the agent/intermediary acts in a manner that is (a) consistent with the obligations placed under this regulation and (b) not prejudicial to competition.
3.4 Any agent or any other intermediary of a broadcaster/multi system operator must respond to the request for providing signals of TV channel(s) in a reasonable time period but not exceeding thirty days of the request. If the request is denied, the applicant shall be free to approach the broadcaster/multi system operator to obtain signals directly for such channel(s).
3.5 The volume related scheme to establish price differentials based on number of subscribers shall not amount to discrimination if there is a standard scheme equally applicable to all similarly based distributors of TV channel(s).
(Explanation: “Similarly based distributor of TV channels” means distributors of TV channels operating under similar conditions. The analysis of whether distributors of TV channels are similarly based includes consideration of, but is not limited to, such factors as whether distributors of TV channels operate within a geographical region and neighbourhood, have roughly the same number of subscribers, purchase a similar service, use the same distribution technology. ”)
3.6 Any person aggrieved of discrimination shall report to the concerned broadcaster or multi system operator, as the case may be.
If the broadcaster or multi system operator does not respond in a satisfactory manner in a reasonable time period, but not exceeding thirty days, the aggrieved party can approach the appropriate forum.
3.7 The provisions of clauses 3.1 to 3.6 shall apply to the contracts already entered into, after 90 days from the date of this regulation coming into force.
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4. Disconnection of TV channel signals
4.1 No broadcaster or multi system operator shall disconnect the TV channel signals to a distributor of TV channels without giving one month notice indicating the brief reasons for the proposed action:
Provided that in case a distributor of TV channel is re-transmitting signals for which he/she is not authorized and thereby affecting the commercial interest of the concerned broadcaster or multi system operator, the notice period shall be two working days giving reasons to the concerned distributor of TV channel for such action.
Explanation A distributor of TV channels is said to be authorised if there exists any agreement between the broadcaster, including his/her agents permitting the distribution of the broadcasting service by the said distributor of TV channels, either through a written agreement or through an oral agreement. Consequently no notice would be required if there is no agreement, written or oral, permitting the distribution of the broadcasting service.
4.2 Broadcaster/multi system operator shall inform the consumers about the dispute to enable them to protect their interests.
Accordingly, the notice to discontinue signal shall also be given in two local newspapers in case the distributor of TV channels is operating in local area and in two national papers in case the distributor of TV channels is providing services in a wide area. Alternatively consumers can be informed through scroll on the concerned channel(s). Where a Broadcaster or a Multi System Operator decides to give this notice through a scroll the Multi System Operator or the Cable Operator, as the case may be, must carry the scroll in the concerned channel(s).
5. Explanatory Memorandum
5.1 Annex A to this order contains an Explanatory Memorandum for the issue of this regulation.
(Rakesh Kacker) Advisor (B&CS) 5 Annex A Explanatory Memorandum
1. The distribution of cable TV in India is characterized by a few dominant broadcasters and large multi system operators (MSOs).
Some of these players have become even stronger as vertical integration has taken place. Last mile operations on the other hand are highly fragmented and therefore there are large disparities in the bargaining power of various players of the distribution chain.
2. The vertical integration may improve efficiency as it reduces the transaction between upstream and downstream operations but at the same time vertically integrated companies may be able to use the vertical integration in certain circumstances to reduce competition.
The anti-competitive behaviour could take the following forms:
(i) Vertical Price Squeeze may happen when a vertically integrated broadcaster increases the price of a TV channel for competing operators but maintains the same price for operator affiliates. The effect would be to reduce or squeeze the margins.
(ii) Exclusivity of the Content could be another form whereby popular TV channels can be denied to a competitor so as to promote the broadcaster’s own distribution network.
(iii) Denial of carriage by a vertically integrated cable system of TV channel of the rival company.
Non Discriminatory Access
3. In India, competition for delivery of TV channels is not only to be promoted within the Cable Industry but also from distributors of TV channels using other mediums like Direct To Home (DTH), Head Ends in the Sky etc. It is important that all these distribution platforms are promoted so that they provide consumers with choice. It would be very important that at this stage vertical integration does not impede competition. Vertically integrated broadcaster and distribution network operators would, in the absence of strong regulation, have the tendency to deny popular content to competing networks or to discriminate against them.
4 One method of checking these practices is to stop at the source any chance of anti-competitive behaviour by ruling that vertical integration will not be allowed. This route could, however, impede investments and in the long run adversely affect competition. The only DTH platform today has a degree of vertical integration. There is another pay DTH platform which is awaiting approval from the government that also has a degree of vertical integration. DTH is the 6 platform most likely to provide effective competition to cable operators.
Restriction of vertical integration could therefore lead to a situation where the DTH rollout could be affected and hence competition. It is for this reason that the alternative route has been looked at;
controlling anti-competitive behaviour wherever it manifests itself.
These issues are dealt with in the following paragraphs.
5 Generally TV channels are provided to all carriers and platforms to increase viewership for the purpose of earning maximum subscription fee as well as advertisement revenue. However, according to some opinions, if all platforms carry the same content it will reduce competition and there will be no incentive to improve the content.
Some degree of exclusivity is required to differentiate one platform from the other.
6 Exclusivity had not been a feature of India’s fragmented cable television market. However the rollout of DTH platform has brought the question of exclusivity and whether it is anti competitive to the forefront. Star India Ltd and SET Discovery Ltd do not have commercial agreements to share their contents with ASC Enterprises on its DTH platform and at present are exclusively available on the Cable TV platform. ASC Enterprises claims that the future growth will remain impacted by the denial of these popular contents. Space TV a joint venture of Tatas and Star, is also planning to launch its digital DTH platform. It has applied for license to the government for the same. The DTH services have to compete with Cable TV. If a popular content is available on Cable TV and not on the DTH platform, then it would not be able to effectively give competition to the cable networks.
7 The issue has to be seen primarily from the consumer’s perspective. If all channels are not available on one DTH platform then the consumer may have to install more than one dish to view his favourite channels. If the content is not available on all platforms then they would not be treated as the same and would be presented as different products having different content. If content, especially popular content, is exclusively available on one DTH platform then there may not be effective competition. The consumers would also have limited choice as subscribing to one particular DTH platform may not ensure the availability of content of his/her choice.
8. The DTH platform would have to be seen as a carrier of TV channels and its vertical integration with the broadcaster cannot be the reason for content denial to the other distributors. The DTH platforms would have to compete on the strength of the quality of service, tariffs and packaging of the TV channels and not on the content.
9. DTH is quite clearly the most effective competitor for Cable TV today. It would be illogical for a consumer to establish two 7 arrangements to view the differing content of two platforms when he has access to the entire content through cable. Moreover if a popular content is available on the cable network and is not available on the DTH platform, it would never be able to give an effective alternative to the cable services. Competition between cable and DTH will be enhanced if all the content is available on both platforms. Similarly the cable industry should not be denied content that is available on DTH. Therefore in the interest of consumers it is essential that all channels are available on all platforms on a non-discriminatory basis.
This would promote competition amongst different platforms and thus would be beneficial for the consumers.
10. The Authority has also looked at international experience in this regard. In India, the problem is that broadcasters may not provide content to rival platforms and this could adversely affect competition in terms of price and quality of service. It is therefore necessary that there should be regulations in place that can be invoked if content is denied in a manner that stifles competition. Thus a general ban on exclusivity at this stage has been envisaged.
‘Must Provide’ through whom
11. There is high cost involved in the distribution of TV channels if the market is fragmented. To reduce the distribution costs broadcasters/ multi system operators should be free to provide access in the manner they think is beneficial for them. The ‘must provide’ of signals should be seen in the context that each operator shall have the right to obtain the signals on a non-discriminatory basis but how these are provided - directly or through the designated agent/distributor- is a decision to be taken by the broadcasters/multi system operator. Thus the Broadcaster/multi system operator would have to ensure that the signals are provided either directly or through a particular designated agent/distributor or any other intermediary.
12. In order to expedite the interconnection process the Authority has further provided that in case an agent does not respond to the request for providing signals within one month of the request, then the applicant would be free to approach broadcaster to obtain signals directly.
Quality of TV Channel Signals
13. Some cable operators had apprehended that in case TV channel signals are provided through cable and not directly then the quality of transmission could deteriorate and accordingly it was suggested that agents must provide services through IRDs. The Authority through this regulation has framed the principle of non-discriminatory access, which also includes non-discriminatory access in terms of quality of 8 signals. Operators can seek relief if it is found that the quality of their signals is being tampered with.
Safeguards for Broadcasters
14. In this context it must be recognized that certain basic criteria must be fulfilled before a service provider can invoke this clause. Thus the service provider should be one who does not have any past dues.
Similarly provisions for protection against piracy must be provided.
However, the content provider must establish clearly that there are reasonable basis for the denial of TV channel signals on the grounds of piracy.
Volume Discounting Schemes
15. An important aim of non discriminatory conditions is to ensure that a vertically integrated supplier does not treat itself in a way that benefits itself, its subsidiaries or its partners and has material effect on competition. The broadcaster/multi system operator must offer the required channels on terms that are no less favourable than those on which it provides equivalent services to its own affiliated operators.
16. Broadcasters and multi system operators are also offering discounting schemes including volume or bulk discounts. Such discounts are not considered anti competitive if these are consistently available to similarly based distributors of TV channels. However such discounts will be treated as anti competitive if provided on preferential basis to one or select group of operators. The Authority has identified three factors which may not be exhaustive relating to the subscriber base, technology of the distribution of TV channels and geographical region and neighbourhood.
Discrimination in providing TV Channel signals
17. In case any distributor of TV channel feels he/she has been discriminated on terms of getting TV signals compared to a similarly based distributor of TV channel, then a complaint must be filed with the broadcaster or multi system operator, as the case may be. In case the complainant is not satisfied with the response, he/she may approach the appropriate forum for relief.
Disconnection of Signals
18. An important issue in the cable industry is the disconnection of signals to settle a dispute. Usually this means that without notice the signals by a broadcaster or multi system operator are cut off leaving consumers in the lurch. This implies that the consumer who has not defaulted nevertheless has to bear the brunt of the dispute between the operators. It is, therefore, necessary to find some solution that will 9 protect the consumers without compromising the ability of the broadcaster/multi system operator to settle their dispute. It has therefore been decided to impose a restriction on the broadcaster/multi system operator that they cannot cut off the signals without giving at least one month’s notice. This would give some time for the affected parties to obtain relief. This notice should also be given through the newspapers so that consumers also have an opportunity to approach the necessary forum to ensure that their interests do not suffer on account of a dispute to which they have not contributed in any way. Broadcasters have suggested that this requirement of notice period should be exempted when disconnection occurs for piracy and copy right violation and violation of the nonfinancial terms and conditions of the interconnect agreement. In the case of unauthorized re-transmission of TV channels, it may be necessary for Broadcaster or Multi System Operator to disconnect signals of TV channels without giving one-month notice. In such cases the Authority has decided that after giving a notice for two working days, the signals may be disconnected.
10 Annex A .
Consultation on draft Regulation
19. The draft Regulation had been put on the website of TRAI and time was given to all stake-holders till 5th November, 2004 for comments on the draft. A number of comments have been received and these have been carefully analysed. Since the number of comments is very large, and in some cases are in the form of modifications to the draft, the gist of the comments have been briefly summarised, section by section in the Annexe to this Explanatory Memorandum and the response of TRAI for each of the comments has been set out. Wherever necessary, the draft has been modified in the light of the comments received.
Some other changes have been made to make the regulation clear.
Some issues have also been raised which are not relevant to the issue of these regulations – these are being separately examined 11 Annexe to Explanatory Memorandum on “The Telecommunication (Broadcasting and Cable Services) Interconnection Regulation 2004” ( 13 of 2004) (The Regulation).
1. Short title, extent and commencement:
Stake-holders comments After the words “service providers” the words “and distributors of TV channels” should be added.
TRAI’s response Service providers include distributors – a definition of service providers has been added to clarify this point. (new definition added at clause 2(n) of the Regulation)
2. Definitions Stake-holders comments i) Agent or intermediary should not be directly or indirectly a distributor of TV channels.
ii) Broadcaster should also include his/her agent or intermediary.
iii) Broadcasting services – it should be clarified that these refer to those services intended to be received by the general public in India.
iv) Cable operator – the definition should include one who provides such a service either directly or indirectly.
v) Cable service – it should be clarified that this means the transmission only with the authorization of the broadcaster.
vi) The definition of MSO should exclude with reference to consumers, since an MSO is not supposed to reach subscribers directly.
vii) The regulation should apply only to those distributors who meet certain minimum qualifications.
viii) The definition of addressable system should be expanded to include other technologies such as DTH, Broadband and MMDS.
12 ix) Definition of DTH operator should clarify that there are other intermediaries like Broadband provider, MMDS provider, etc.
TRAI’s response
(i) At present this is not the practice – MSOs supply signals and also provide direct connections to subscribers. If this definition is to be amended as proposed it would mean considerable realignment of the business – this should therefore not be done unless this is shown to be absolutely necessary; accordingly this need not be done now. For the present therefore this is not being done and if there is enough evidence that this practice is causing problems then this would be considered later. However to address the likely problem it is being provided in clause
3.3 that broadcasters and MSOs will have to ensure that the agent or intermediary acts in a manner that is (a) consistent with the obligations placed under this regulation and (b) not prejudicial to competition. (proviso added to clause 3.3).
(ii) There is no need to change the definition since the recourse to the broadcaster is only after the agent or intermediary is not able to satisfy the person aggrieved. Broadcasters would in any case be liable for the actions of their agents and intermediaries, because a representation would lie to the broadcasters after the agent/intermediary is not able to provide satisfaction. At this stage the Broadcaster would either have to satisfy the person aggrieved or the aggrieved person will have to go the appropriate forum. The proviso to clause 3.3 also makes this clear.
(iii) This is not necessary since the TRAI Act in any case applies to the whole of India.
(iv) This change is not required; the definition of cable operator is as defined in the Cable Act and does include one who provides such services indirectly.
(v) This is not necessary – if signals are carried without authorization of the broadcaster then no protection can be given; this is also being clarified in clause 4.1
(vi) As discussed in (i) above such a change is not desirable at this stage.
(vii) This is not necessary for TRAI to specify – each company should decide its own policy which should be applied uniformly and without discrimination.
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(viii) The definition of addressable system has been modified by replacing the word “cable operator” with the words “Distributors of TV channels” so that all distributors are included (clause 2(a) amended accordingly).
(ix) The definition of DTH operator has been modified to make reference to all distributors of TV channels rather than only the cable operator (clause 2(k) amended accordingly).
(x) In addition the definitions of “agent or intermediary” have been changed replacing the word “entity” by the words “any person ,including an individual, group of persons, public or body corporate, firm or any organization or body” to bring it in line with the definition of broadcaster.
3. General Provisions relating to Non-discrimination in Interconnection Agreements.
Stake-holders comments
(i) Non- discriminatory access should not be mandated by regulation. Ban on exclusive contracts will hit premium programming and adversely affect competition.
(ii) Even under the MRTP Act exclusivity is permitted if this is not prejudicial to the interests of consumers. Exclusivity should be dealt with under the provisions of the MRTP Act.
(iii) Transition clause is required for change over to the new system or a provision should be made providing that the regulation is not applicable to old contracts. If time is being given for transition then for this purpose time may be given upto January 1, 2006.
(iv) The regulation should be applicable only to non addressable systems.
(v) The proposed regulation is violative of the freedom of speech guaranteed in the Indian Constitution and the rights of broadcasters in the TRIPS agreement and the Berne convention.
(vi) The Regulation should only require vertically integrated companies to offer their content on terms no worse than what it has agreed for its own platform.
(vii) It would be advisable to spell some outlines of the controlling mechanism on the operational aspects of “Must Provide”.
(viii) It may be useful to have a description of DTH in the main regulation itself.
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(ix) The Explanatory Memorandum should be clarified to bring out that grounds of piracy cannot be invoked if the distributor of TV signals has deployed anti piracy measures and installed transparent subscriber management systems duly accredited by BECIL.
(x) The provisions will hurt rural consumers who cannot afford terms offered by urban consumers. It may also not be administratively/economically viable to provide services to small operators.
TRAI’s response
(i) This issue has already been discussed in the Recommendations sent on 1.10.2004. It is the Authority’s view that given the present stage of the market it is necessary to provide non discriminatory access across different distributors and correspondingly not provide for exclusivity.
(ii) As has already been explained in the recommendations exclusivity at this stage will only harm the consumers. The provisions of MRTP apply to all consumers and industries. In the case of the TV programme market the Authority has already come to the conclusion that exclusivity at this stage would be harmful after examining the issues in great detail. The Authority has a mandate to provide effective interconnection, promote competition and protect the interests of the consumers.
This it has to do under the powers given to it. Nondiscrimination is a well known regulatory principle and similarly not allowing exclusivity is also a practice followed in some countries to foster competition.
(iii) A new clause is being added -3.7- to provide that 90 days will be given for old contracts to be renegotiated and bring them in compliance with the new regulations. This time is sufficient as it may not be necessary to renegotiate all contracts – provision has already been made in clauses 3.4 and 3.6 for redressal of alleged non- compliance before recourse may be had to the appropriate regulatory/legal forums. ( Clause 3.7 added) .
(iv) The Authority has already indicated that prices of new channels will not be regulated in CAS areas except for the limited regulation on the discount on prices of bouquets vis-à-vis prices of individual channels. However, these prices should be uniformly applicable to all similarly placed distributors.
Allowing discrimination in these prices could lead to unfair competition in the addressable segment of the market.
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(v) It is not correct that the Regulation is in violation of the Constitution. TRAI is under obligation under the TRAI Act to ensure effective interconnection and protect the interests of consumers. This regulation will help in promoting competition and providing more areas to cable services. Further there is no infringement of the right to get equitable compensation in these regulations. The restriction on prices is through the tariff order which has not been challenged on these grounds. There is also no question of the TRIPS Agreement or the Berne Convention being violated by these regulations as it is a well established principle of our law that international law has to be translated into domestic law before it becomes enforceable. No violation of the domestic law protecting the broadcaster has been made out.
Thus if the rights of the broadcasters have been impacted under the relevant international law the remedy will be to get the offending domestic law changed. Till then TRAI would have to fulfill the mandate given to it under the TRAI Act read with the relevant domestic laws.
(vi) It is necessary to ensure that access is provided to all content and not merely that of the vertically integrated companies. This is required for content to be available on all platforms which would ensure fair competition amongst rival platforms.
(vii) These have been spelt out in the regulation. Essentially it would be for an individual service provider to seek remedy, in the first instance, from the broadcaster/MSO or their intermediaries. If this does not succeed, then the service provider has to approach the appropriate forum for relief.
(viii) DTH has been defined in the regulations and a DTH operator is included in the definition of distributor of TV channels and thus DTH is automatically included in the body of the regulations.
Nevertheless clause 3.2 has been amended to make this amply clear (clause 3.2 amended).
(ix) Normally there should well accepted standardized measures taken for preventing piracy, at least on well established technologies where there would be standard requirements and procedures. However if there is no such standard then the two parties could refer the matter to a well known technical expert.
TRAI would not be in a position to specify the expert.
(x) In the industry today there exist wide variations in the prices – by providing for geographical variations in prices in terms of the explanation to clause 3.5, this variation will not be affected. Also by allowing for content to be delivered either directly or through agents/intermediaries it has been recognized that broadcasters 16 need not deal directly with all operators. This is already the industry practice. Further, it is for each service provider to have a well defined policy that can weed out non-serious players but at the same time ensure that there is no discrimination. It is also pertinent that this issue has been raised by broadcasters and not by MSOs- it is the MSOs who have been in an increasing way dealing directly with the last mile operators.
3.1 Stake-holders comments i) This Clause should not apply for content made exclusively for addressable systems.
ii) The clause should be applicable to broadcasters as well as their agents/subsidiaries.
TRAI’s response
(i) This has already been dealt with in 3(iv) above.
(ii) In view of the provisions of clause 3.3 this is not necessary.
3.2 Stake-holders comments i) Apart from non-discriminatory access, provision of access “on similar/equitable commercial terms” should be added as a principle.
ii) The exclusion of operators having defaulted in payment should be qualified to provide for a minimum of 15/30 days notice for the defaulting distributor to make good the default in payment.
The Authority has made similar provisions for telecom service providers for disconnection on the ground of non payment of dues.
iii) In view of the bandwidth constraint in analogue systems, it may not be possible to re-transmit all the channels requested by the distributor.
iv) After the words Multi-System Operators “and Cable Operators” should be added.
v) It should be stipulated that the broadcasters should provide their signals within 15 days of the request having been made.
17 vi) Apart from those who have defaulted in payment, this clause should not apply to those who have indulged in piracy or material breach of commercial terms like under-declaration of subscriber base.
vii) Pricing should be uniform irrespective of technology viii) All distribution platforms should get the signals on the same effective commercial terms.
ix) The word “defaulted” needs to be suitably defined.
TRAI’s response
(i) The essential purpose of the regulation is to promote competition by ensuring that content is made available to all distributors so that competition is developed. The addition of the words “similar/equitable” would not help in meeting this objective.
(ii) Clause 4.1 already provides for a 30 days notice. This would include disconnection for non payment. For operators seeking a new contract and who have defaulted in the past there is no need to prescribe a time period as such operators can get the new contract as and when the default is removed.
(iii) The clause does not require all channels to be re- transmitted.
All that is required is that the MSO should not discriminate between cable operators. The clause applies only to requests from distributors of TV channels and not from broadcasters.
The issue of “must carry” is being separately looked at by the Authority.
(iv) This is not necessary as by definition a cable operator cannot retransmit.
(v) The time taken to respond will vary from platform to platform depending on the technology and other factors. Rather than prescribe different periods for different types of requests/problems clauses 3.4 and 3.6 are being amended to say that the request/complaint must be responded to in a reasonable time period but not exceeding thirty days (clauses 3.4 and 3.6 have been amended accordingly)
(vi) Piracy is too wide a term and can also include underdeclaration.
Unless underdeclaration is defined correctly this would be difficult to enforce. Piracy, if invoked as a ground for refusing content to a new entrant will have to be justified as already 18 explained in the explanatory memorandum. For existing operators the provision of 4.1 will apply.
(vii and viii) This has been addressed in 3.5(ii & iii)
(ix) The word defaulter is well understood and whether a person has defaulted or not needs to be determined with reference to the facts of the case and the contractual arrangements between the service providers.
3.3 Stake-holders comments i) Broadcasters must be held responsible for the actions of their agents/intermediaries.
ii) Multi-system operators should not be allowed to act as a designated distributor agent.
iii) This clause should not be used by broadcasters to defeat the Tariff Order of October 1, 2004.
iv) The agent or distributor should not be an MSO or a distributor of TV channels within that territory and distributor should be able to receive signals of a channel directly from the satellite.
v) The second and third sentences of this section can be deleted.
vi) The words “on an equitable and non-discriminatory basis” should be added at the end of the second sentence.
TRAI’s response
(i) This is already provided for in the regulation; to make this explicit a proviso has been added. (proviso added to 3.3)
(ii) This has been addressed in 2(i) above.
(iii) The tariff order is an independent order and its provisions will have to be complied with.
(iv) This has been partially addressed in 3(ii) above. Whether a distributor should be entitled to receive the signals through cable or directly from the satellite is a matter to be negotiated between the service providers. If a distributor of TV channels finds that he would be discriminated against and the 19 broadcaster is not able to rectify the problem then he can always approach the appropriate regulatory forum.
(v) Both these sentences are necessary since the Broadcaster/MSO have to ensure that the signals are received by the distributor.
The primary responsibility has to be that of the broadcaster/MSO.
(vi) As in 3.2 (i).
3.4 Stake-holders comments i) If the agent denies content, the broadcaster must respond to his complaint within two days of the receipt of the complaint and the agent/broadcaster should be made liable to pay compensation for the loss caused by any wrongful delay in providing services.
ii) An agent who has defaulted in payment to MSO should not be allowed to take signals directly from a broadcaster.
iii) Distributor should be entitled for compensation for any losses incurred by them because of them acts of omission/refusal on the part of a broadcaster, MSO or their agent/intermediary.
iv) It should be stipulated that the broadcaster must provide the signals within 15 days of the request having been made provided that there are no pending dues to the broadcaster/ respond within 30 days.
v) After the word “broadcaster” the word “MSO” should be added.
vi) The broadcaster/MSO should ensure that signals are provided to the applicant within 7/30 days.
vii) This clause should apply even if the broadcaster is not located in India as long as the broadcasting services are marketed in India viii) Imposition of terms that are unreasonable will be deemed to be a denial of the request.
ix) The response of the broadcaster and MSO should not be specified by a time limit; instead it should merely be specified to take place within a reasonable amount of time.
TRAI’s response 20
(i)(iii)(iv)(vi) and (ix) This has been partially addressed in 3.2(v) above.
Damages cannot be awarded by TRAI .
(ii) The proviso to clause 3.2 already provides that there is no obligation to provide signals to a distributor of TV channels who has defaulted in payment . If an MSO wants to ensure that a distributor of TV channels who has defaulted does not get signals from a broadcaster then this should be done by a contractual arrangement.
(v) This has been done ( clause 3.4 amended accordingly).
(vii) This is already provided in the law – there is no need to make a separate provision for this.
(viii) A second proviso has been added to provide for this in Clause 3.2 (clause 3.2 amended accordingly)
3.5 Stake-holders comments i) The broadcaster should announce a standard scheme regarding rates to be charged as well as declared subscriber base.
ii) The words “based on number of subscribers” should be deleted from the clause as well as the explanation and the words “use the same distribution technology” should also be deleted from the explanation.
iii) The words “use the same distribution technology” should be replaced by “irrespective of the technology used for distribution of signals”.
iv) The clause should provide that a standard scheme equally applicable to all similarly based distributors of TV channels should be drawn up in this regard.
v) Volume discounting should be left to the market and there should be no insistence on a standard scheme.
vi) The quantum of discount needs to be specified to prevent exploitation of this provision.
TRAI’s response
(i)(iv) and (v) It is for each broadcaster to decide on whether or not there should be such a policy. If there is a policy then 21 discrimination would be allowed based on volumes. If there is no such policy then such discrimination would not be permitted. If different distributors are going to get different prices the there must be some justification for it – in the absence of such justification such discrimination could be used eliminate/reduce competition.
(ii) and (iii) It is necessary to retain these words as the intention is to allow volume based discrimination and also permit different terms and conditions of supply based on the different technologies being used. However since in non- addressable systems payment is normally made only for the number of subscribers negotiated and agreed upon while in an addressable system payment is made for all the consumers it should normally be expected that price in an addressable system would be lower than in a similar non addressable system.
(vi) It is not necessary to quantify the discount, as the only purpose of the regulation is to prevent discrimination. The extent of discount would depend on the benefits perceived by individual broadcasters/MSOs from higher volumes – a uniform ceiling for this purpose would be difficult to fix.
3.6 Stake-holders comments i) There should be safeguards in place to prevent this clause being used to harass the distributor.
ii) The “appropriate forum” should be spelt out.
iii) It should be clarified that the aggrieved party can approach the appropriate forum for various reliefs such as injunction, restoration of signals, damages, etc.
iv) Disputes should be resolved within 30 days and in case the broadcaster/distributor does not cooperate then the signals should be made available to the subscribers, subject to the final decision of such a forum.
TRAI’s response
(i) Safeguards have already been provided in the draft; the additional safeguards proposed have not been spelt out.
(ii) and (iii) The appropriate forum could be TRAI, TDSAT or a High Court/ Supreme Court depending upon the nature of the case and relief sought. This cannot be specified ex ante. Relief to be 22 obtained will be as per the TRAI Act or the Constitution and other relevant laws. These cannot be defined by Regulation
(iv) Whether signals should be provided as an interim measure as is being suggested has to be decided on a case to case basis. This cannot be specified by Regulation.
Disconnection of TV channel signals
4.1 Stake-holders comments
(i) Disconnection period for unauthorized distribution should be 7 days since two days is too short to obtain relief in cases of unjustified disconnection. The words “authorisation” and “commercial interest” should be defined.
(ii) A one month notice is too long and would provide a distributor an opportunity to earn money from the consumers without paying the broadcaster.
(iii) The distributor and not the broadcaster should be responsible for advising the consumer on whether the distributor has met his/her obligations to the broadcaster , notice should be placed in the monthly bill and the consumer should get compensation from the distributor such as a discount in the monthly bill.
(iv) In case of piracy the distributor should be given an opportunity to rectify the problem and protect the commercial interest of the broadcaster/MSO.
(v) For checking piracy certain safeguards should be specified in the Regulation.
(vi) The words “for which he/she is not authorized and” should be replaced by the words “by stealing the same in an illegal manner”.
(vii) Distributors should be entitled for losses suffered by them due to wrongful acts of broadcasters in disconnecting such signals.
(viii) The word “thereby” should be added before the words “affecting commercial interest”
(ix) For unauthorized retransmission no notice period should be given; a brief notice can only be required when there is a business relationship.
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(x) No disconnection should be allowed for disputes on subscriber base.
TRAI’s response
(i) In such cases since a period of two working days has been provided this should be enough – given the nature of the problem allowing a larger period would not be desirable. The word “authorization” has been clarified to mean any agreement permitting the distribution of the broadcasting service, either through a written agreement or through an oral agreement. Commercial interest is well understood and need not be clarified further.(Explanation added to clause 4.1)
(ii) This is necessary to provide time for dispute resolution and for consumers to ensure that they can continue to have access to the content for which they have not defaulted. Broadcasters/ MSOs can protect their interests by making appropriate provisions in their contracts.
(iii) The onus of making the decision known must lie with the person making the decision. The regulation does not bar the recovery of costs/damages from the person who is found to be at fault later. Such recovery has to made under the contractual terms between the parties and TRAI cannot provide for such recovery. However it is being provided that if the broadcaster/MSO does give a notice to be carried as a scroll on the concerned channel then the distributor must carry the notice as a scroll in the concerned channel(s).(necessary amendment carried out in Clause 4.2)
(iv) This has to be mutually settled between the contracting parties.
Given the nature of piracy more then two days notice would not be desirable.
(v) These safeguards have to be determined contractually as they can vary depending upon the technology used and perceptions of the copyright holder. The only restriction that can be placed in the regulations is the need to ensure that this does not become an obstacle for fair competition and hence the principle of non discrimination has been incorporated in the regulation.
(vi) This suggestion has been examined. It would be better to use the words in the draft with the clarification for the word authorised as in (i) above.
(vii) This is beyond the scope of the TRAI Act and hence these regulations. The Act only provides for fines as provided in 24 section 29. Damages have to be claimed through other legal forums.
(viii) This correction has been done.
(ix) This has been clarified by adding the following in the explanation after Clause 4.1 “no notice would be required if there is no written or oral agreement permitting the distribution of the broadcasting service”
(x) If such a clause were to be added, this would imply that broadcasters would have to provide their services irrespective of the subscriber base declared. This would not be desirable as the subscriber base is a negotiated number and changes in this lead to disputes. Such disputes would have to be settled mutually or by using the legal process available under the law.
4.2 Stake-holders comments
(i) The payments for ads should be borne initially by the stakeholder who is planning to discontinue the signal and the payment can be mutually shared in any ratio during settlement.
.
(ii) Public notice should be both by scroll and newspaper ad since a scroll is sometimes not noticed by the consumers
(iii) Broadcaster/MSO should not be responsible for informing the consumers and it should be distributor who should place a placard or scroll advising the consumers of the dispute.
(iv) The scroll should not hamper/restrict the view of the channel for the consumers.
TRAI’s response
(i)As has been discussed in 4.1 (iii), the cost of informing the consumers would have to be borne initially by the service provider who is disconnecting and later this can be recovered from the service provider who is found to be at fault.
(ii) At present both the options are available. Depending on the experience with the scroll option, the regulation can be reviewed later.
(iii) This has already been discussed in 4.1 (iii).
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(iv) It is presumed that if a scroll is inserted, it would be done in a manner that does not affect the consumers ability to view the channel. The regulations need not specify such details.
26 TELECOM REGULATORY AUTHORITY OF INDIA No. 3-57/2005/B&CS March 3, 2005.
New Delhi In exercise of the powers conferred by section 36, and paras (ii), (iii) and (iv) of clause (b) of sub-section (1) of section 11 of the Telecommunication Regulatory Authority of India Act, 1997, read with the Notification No.39 (S.O No. 44 (E) and 45 (E))dated 09.01.2004 issued from file No.13-1/2004-Restg by the Government of India under clause (d) of sub-section (1) of Section 11 and proviso to clause
(k) of sub section (1) of the Section 2 of the Telecom Regulatory Authority of India Act, 1997, the Telecom Regulatory Authority of India hereby amends the Telecommunication (Broadcasting and Cable Services) Interconnection Regulation 2004 (13 of 2004) (hereinafter called the “Principal Regulation”), as follows, namely -
1. Short title, extent and commencement:
(i) This regulation shall be called “The Telecommunication (Broadcasting and Cable Services) Interconnection (First Amendment) Regulation 2005” (2 of 2005)”.
(ii) It shall come into force from the date of its publication in the official Gazette.
2. The words and figures “120 days” shall substitute the words and figures “90 days” in clause (7) of regulation 3 of the Principal Regulation.
3. This regulation contains at Annex A, an Explanatory Memorandum that explains the reasons for this amendment to the Principal Regulation.
By Order (DR. HARSHA VARDHANA SINGH) Secretary-cum-Principal Advisor Annex. - A EXPLANATORY MEMORANDUM
1. The Telecom Regulatory Authority of India had notified “The Telecommunication (Broadcasting and Cable Services) Interconnection Regulation 2004” (13 of 2004) and it came into effect w.e.f. 10th December 2004. As per the provisions of this regulation, all the broadcasters /multi system operators and their agents/ intermediaries through whom they provide the signals are required not to engage in any practice or activity or enter into any understanding or arrangement, including exclusive contracts with any distributor of TV channels that discriminates against any other distributor of TV channels. A period of 90 days was granted in respect of the contracts already entered into before the provisions regarding non-discrimination in Interconnect Agreements would apply to these contracts. This period of 90 days was given for old contracts to be renegotiated and brought in compliance with the new regulations.
2. A proposal was received from a broadcaster to extend the transition period for another 60 days to enable all the agreements to be compliant with the regulations. The reasons given for seeking such an extension are: -
(a) The broadcaster has more than 6000 contracts with various distributors of TV channels that got signed at different points in time. In addition to the above, before the enforcement of the Interconnection Regulation, they had launched several new channels and signed up addendums/ contracts with various operators.
(b) They are now working towards transitioning their various contracts and addendums to make them compliant with the Interconnection Regulation. In addition several internal organizational activities are being implemented to ensure that the transition is entirely smooth, such as • Formulation of a Policy for distribution of its channels in India to clearly articulate to the distribution personnel the Company’s position on various issues related to distribution with step by step instructions on ensuring all activities are compliant with the Interconnection Regulation.
• Review of existing contracts and addendums. On finalization of Distribution Policy, the existing contracts and addendums will be modified to comply with the Policy. The 6000+ contracts will then be re-signed in the modified formats to the extent required and subject to negotiations with their associates.
• Several workshops have already been conducted for distribution personnel and distributors across the country to help them understand the provisions of Interconnection Regulation. The inputs received from these workshops will be used to resolve outstanding issues and queries. Company executives are being briefed in detail regarding the process to be followed for executing the commercial arrangements.
• Organizational processes and systems are being defined to streamline all new activities required to be undertaken by the Company to comply with all the provisions of Interconnection Regulation.
3. The Authority had considered the request to extend the transition period for another 60 days and in line with its consultative approach, it decided to seek comments on the proposed extension of the transition period from 90 days to 150 days. A Press Release was accordingly issued on 11th February 2005 seeking comments in the matter till 18th February
2005. The following are the major comments have been received on the issue:-
(a) Jaipur Cable & Broadband Society has stated that increase in transition period will have adverse effect on those cable channel distributors who raised their voice against broadcaster/ MSO monopolies. By giving more time broadcasters/ MSO will have enough time to manipulate things on the ground. It will delay the upcoming competition in the market. It has further said that there is only one MSO in Jaipur and it is capturing cable networks by increasing connectivity amount. Extension of transition period by 60 days would mean that broadcasters would not give decoders to cable operators for 150 days and it will be difficult to sustain 150 days without Pay channels.
(b) Cable Operators Federation of India has objected to the proposal for the following reasons :- • All the major broadcasters have made alliance with each other for distribution whereby they are distributing channels in bouquets through a joint distribution staff.
• It is not true that they are unable to renew their contracts as per the new terms in 90 days as the broadcasters have a very large distribution department comprising of distribution heads, regional managers, area managers and distribution executives in each major town. Apart from this, there are distribution companies in every major city who deal with LCOs. Thus at a lower level, a distributor may not have to deal with more than 40-50 contracts in 90 days.
• The broadcasters are not taking any interest in revising their contracts with existing operators and they are busy in forcing the cable networks to increase their connectivity by 40-60% by appointing minimum guarantee agents in each area. Additional 60 day period will give opportunity to these minimum guarantee agents and their affiliated MSOs to extract the maximum from the existing cable operators.
4. The additional time period of 30 days being granted by this amendment is considered adequate by the Authority for the reason that in case any complaint of a discriminatory interconnection agreement is received by the Authority, the broadcasters /multi system operators/ their agents/ intermediaries would be given an opportunity of explaining their position and rectifying the same. This would give them an opportunity to make such a contract compliant with the Interconnection Regulation.
5. Although the Authority had earlier approved only 90 days for the transition period it is considered that in view of difficulties experienced by the broadcasters and the steps taken so far a further extension of 30 days can be given. Moreover, this is only a one time provision and will have no long term impact. On the other hand if all preparations are not completed there could be unnecessary litigation.
6. Therefore, after considering the proposal and the objections, the Authority decided to extend the transition period from 90 days to 120 days.
1 TELECOM REGULATORY AUTHORITY OF INDIA NOTIFICATION New Delhi the 24th August 2006 F. No. 11-13/2006- B&CS - In exercise of the powers conferred by section 36, and subclauses (ii), (iii) and (iv) of clause (b) of sub-section (1) of section 11 of the Telecom Regulatory Authority of India Act, 1997 (24 of 1997), read with the Notification No.39 {S.O No.44(E) and 45(E)} dated 9.1.2004 issued from file No.13-1/2004-Restg by the Government of India under clause (d) of sub-section (1) of section 11 and proviso to clause (k) of sub section (1) of section 2 of the Telecom Regulatory Authority of India Act, 1997 (24 of 1997), the Telecom Regulatory Authority of India hereby amends the Telecommunication (Broadcasting and Cable Services) Interconnection Regulation, 2004 (13 of 2004) (hereinafter called the “Principal Regulation”), as follows:-
1. Short title, extent and commencement.- i) This regulation shall be called ‘The Telecommunication (Broadcasting and Cable Services) Interconnection (Second Amendment) Regulation, 2006 (9 of 2006)” ii) It shall come into force from the date of its publication in the Official Gazette.
2. In clause 2 of the Principal Regulation, sub-clause (a) and entries relating thereto shall be substituted by the following sub-clause and the entries relating thereto, namely: - “(a) “addressable system” means an electronic device or more than one electronic device put in an integrated system through which signals of television channels can be sent in encrypted or unencrypted form, which can be decoded by the device or devices at the premises of the subscriber within limits of the authorization made, on the choice and request of such subscriber, by the service provider to the subscriber.” 2
3. The existing clause 5 of the Principal Regulation shall be renumbered as clause 7.
4. In the Principal Regulation, after the existing clause 4 and the entries relating thereto, the following clauses and the entries relating thereto shall be added as clauses 5 and 6, respectively, namely :- “5. Standard Interconnection Agreements
5.1 All broadcasters, multi system operators and cable operators shall mutually negotiate and finalise their interconnection agreements in respect of areas notified by the Central Government under section 4A (1) of the Cable Television Networks (Regulation) Act, 1995 (7 of 1995) vide notification no. S.O. 1231(E) dated
31.7.2006.
5.2 In case any of the service providers in the areas as notified by the Central Government vide notification no. S.O. 1231(E) dated
31.7.2006, are not able to arrive at a mutually acceptable interconnection agreement within a time-period to be specified by the Authority through a direction, then they shall enter into interconnection agreements in terms of the standard interconnection agreements as specified in Schedule I (between broadcaster and multi system operator) or in Schedule II (between multi system operator and cable operator) to this Regulation, as the case may be, within a time period to be specified by the Authority for entering into standard interconnection agreements.
Explanation For removal of doubts, in respect of areas notified by the Central Government referred to in clauses 5.1 and 5.2 above, it is clarified that if the service providers have already entered into mutually acceptable interconnection agreements by such date as specified in the direction issued by the Authority, then they need not take recourse to standard interconnection agreements specified in Schedules I and II. Further, 3 those service providers, who have a pre-existing interconnection agreement as on the date of issue of this regulation, will also have the option, after the expiry of their existing agreement, to either enter into a mutually acceptable interconnection agreement, or failing which to enter into interconnection agreements as per the standard agreements specified in Schedules I & II, within a period to be specified by the Authority in the direction.
5.3 If the provisions of the standard interconnection agreements in Schedule I and II are in conflict with any Act, rule, regulation, direction or order of the Government, TDSAT or TRAI, as the case may be, then the provisions of such Act, rule, regulation, direction or order shall prevail.
6. Prohibition of minimum guarantee clause Where a distributor of TV channels is using a technology by which pay channels can only be seen through an addressable system, then no service provider shall stipulate, insist or provide for any clause in an interconnection agreement with such a distributor which would require such distributor to pay a minimum guaranteed amount as subscription fee for the services provided.”
5. This regulation contains at Appendix, an Explanatory Memorandum.
By Order (RAKESH KACKER) Advisor (B&CS - I) 4 Schedule 1 [Broadcaster and Multi System Operator (MSO)] STANDARD TECHNICAL AND COMMERCIAL INTERCONNECTION AGREEMENT [CAS] This Technical and Commercial Interconnection Agreement along with its Schedules and Annexures is executed on this _____ day of ______ 2006 by and between:
M/s A & Co Ltd, a company incorporated under the Companies Act, 1956, having its registered office at 001, XYZ Colony ABC City (hereinafter referred to as “Broadcaster” which expression shall unless repugnant to the context or meaning thereof be deemed to include its successors and permitted assigns) of the ONE PART;
AND M/s. B & Co Ltd, a company incorporated under the Companies Act, 1956, having its registered office at 00111, PQR Colony ABC City (hereinafter referred to as the “Affiliate” which expression shall unless repugnant to the context or meaning thereof be deemed to include the successors and permitted assigns) of the OTHER PART.
The Broadcaster and the Affiliate are hereinafter individually and collectively referred to as “Party” and “Parties”, respectively.
WHEREAS:
a) The Broadcaster is engaged in the business of distribution of Television channel(s) and has the exclusive right to market and distribute Television Channels, in particular the Television channels specified in Annexure A throughout the territory of India or in the territory comprised in ----- in India b) The Affiliate is engaged in the business of distribution of television channels including through a digital /analogue Conditional Access System (“CAS”) in the areas notified by the Central Government under Section 4A(1) of The Cable Television Networks (Regulation) Act, 1995 (7 of 1995);
c) The parties have mutually agreed to execute this Agreement between them to govern the rights and obligations in regard to the subscription and distribution of Television channels, appropriately described in clause 1.1 of Article 1 of this Agreement read in conjunction with Annexure A, for the Term and in the Area specified herein NOW THEREFORE, in consideration of the foregoing and the mutual covenants contained herein, constituting good and valuable consideration, the Parties agree as follows: - ARTICLE 1: SCOPE OF SERVICE, AREA SERVED, TERM AND ENTIRE UNDERSTANDING
1.1 SCOPE OF SERVICES The Parties mutually agree that this Agreement seeking to govern the terms and conditions of rights and obligations between them shall be in respect of the services indicated herein below and as specifically described in Annexure A to this Agreement for the area and for the term indicated in clause 1.2 and 1.3, respectively.
5 Subscription to and distribution of the Television channels whether as an individual channel or as a part of a Bouquet and described in Annexure A to this Agreement through the Permitted Distribution System with Conditional Access System directly or indirectly to the subscriber, For the purpose of ascertaining the scope of services at any point of time, the scope of services as indicated above shall be read with additions /deletions, if any, done through separate addendum agreements/ updation forms executed from time to time and till the date of reckoning.
1.2 AREA (S) SERVED The parties mutually agree that the services referred in clause 1.1 of this Agreement shall have reference to the area specified in the city/cities of …… specified in the Government of India, Ministry of Information and Broadcasting notification number S.O. 1231(E) dated 31.7.2006.
1.3 TERM
1.3.1 The Agreement shall come into effect from DD/MM/YYYY ("Effective Date") and shall be valid for a period of 12 months (“Term”) unless otherwise terminated prior to the expiry of validity period of 12 months in accordance with the terms and conditions of the Agreement.
1.3.2 Within 2 months prior to expiry of this Agreement, both parties agree to take steps towards renewal of the Agreement for extended period if it is mutually intended to continue the term of the Agreement beyond the date of expiry. The parties shall inform the subscribers through appropriate means of the intention to carry out the negotiations and consequences to the subscribers if negotiations fail to succeed.
1.3.3 If the parties mutually decide to extend the term to continue the Services referred to in clause 1.1 above with or without modification, the Parties may enter into a fresh agreement, in writing on mutually agreed terms and conditions.
1.3.4 In case if the parties decide not to extend the term and such decision could not be made before the expiry of the term of this Agreement and the services have continued in the meanwhile even after the said expiry of the term specified in clause
1.3.1 of this Agreement, the term would be deemed to have been extended till the date of such decision.
1.4 ENTIRE UNDERSTANDING
1.4.1 The Agreement contains the entire understanding between the parties with respect to the subject matter covered, in the manner, it is expected to be understood by the parties and that there is total agreement between the parties as to the manner in which the other party has understood various clauses of this Agreement.
1.4.2 The Parties agree that in addition to the principal terms stated herein, the Schedules and Annexures if any attached hereto form an integral part of the Agreement and shall be deemed to be incorporated herein and failure to comply with any of the terms, conditions, and/or provisions mentioned in any of the Schedules and Annexures hereto, shall constitute breach of the Agreement.
6
1.5 DEFINITIONS The words and expressions used in this Agreement shall have meanings as assigned to them in the Schedule to this Agreement.
ARTILCE 2 : SUBSCRIPTION RIGHTS
2.1 Subject to due observance by the Parties of the terms and conditions of this Agreement and in consideration of the promise by the Affiliate to make payment of the Subscription Amounts which are due and payable in terms of this Agreement to the Broadcaster, the Broadcaster hereby grants to the Affiliate, for the duration of the Term of this Agreement, a non-exclusive right to avail the services indicated in clause 1.1 of Article 1 comprising in the right to subscribe to and to distribute the Subscribed Channels as described in Annexure A through CAS to the subscribers in the Area only via the Permitted Distribution System. The Affiliate shall have the right to distribute the viewing of the subscribed Television Channels only to subscribers in the Area and not to any other third party.
2.2 The subscription rights given to the Affiliate under this Agreement are confined to subscribers having an addressable set top box, in relation to whom the Affiliate compulsorily maintains the complete detailed data and transaction records in its CAS/ Subscriber Management System (SMS). This Agreement does not give the Affiliate or his agents rights to transmit by any mode of transmission from the head end of the Affiliate to the commercial operators and/or its subscribers other than through coaxial or optic fiber cable. A separately negotiated agreement would have to be entered into for the purpose of transmission through any other means such as DTH or HITS or any other mode.
2.3 Without prejudice to the remaining provisions of this Agreement, the Broadcaster reserves the right:
2.3.1 to commence or continue to provide the Service direct to other Affiliates and to appoint other Affiliates in the Area for the purpose of distributing the Service, subject, however, to the observance of the provisions of applicable law in force.
2.3.2 to discontinue any Channels which form part of the services as Broadcaster shall deem fit subject to and in compliance with the rules, regulation and orders , if any in this regard.
2.4 In the event of an increase/decrease in the number of the Subscribed Channels taken by the subscribers, it is obligatory on the part of the Affiliate to include, delete, increase or decrease the same, as the case may be, in his SMS/CAS and intimate the same to the Broadcaster at the time of paying the Subscription Amount for the respective month according to the terms of this Agreement.
2.5 It is expressly agreed between the Parties that the Affiliate’s right to receive and distribute the Service shall be conditional upon the performance by the Affiliate of all its obligations arising under this Agreement and mere possession of the Integrated Receiver Decoders (IRDs)/ Viewing Cards shall not entitle the Affiliate to receive and/ or to distribute the Service.
2.6 The Affiliate shall receive and de-code the Subscribed Channels only through IRDs recommended/approved by the Broadcaster.
7
2.7 The Affiliate shall further ensure that the Services of Subscribed Channels for which a fee is payable as specified in Annex A shall only be activated through the set top boxes which meets the specifications prescribed by BIS; otherwise the Broadcaster shall be entitled to de-activate the Service of the Affiliate. For the purpose of compliance of this clause, the Affiliate shall give a certificate to the Broadcaster that a mutually agreed procedure for verification is in place and that the same has been followed in respect of each subscriber.
2.8 The following conditions are a prerequisite for the execution of the present Agreement and shall subsist for continuing the same:
• The Affiliate shall install the CAS, which is linked and integrated, with SMS and activation/deactivation are processed through such SMS. Both CAS and SMS systems should be as per the standard prescribed by BIS. The reports generated by SMS should be in conformity with CAS and in a pre-defined read only format such as a suitable PDF format, which cannot be edited.
• The Affiliates operating system should be able to handle individual channels, packages, tiers, discounts, free offers, promotional offers;
• The CAS and SMS of Affiliate must have the capability or recording activation/deactivation history with respect to each addressable device (IRD/VC) and each service for every activation and deactivation in the system for a minimum period of 1 year.
• The Services of the Broadcaster shall be provided to the subscribers only through CAS/SMS and no services shall be provided without recording, authorization, billing and accounting through the said system.
• The Affiliate shall be liable to provide to the Broadcaster, as and when demanded by the Broadcaster, from time to time a list of subscribers pertaining to any location along with the names and addresses of the subscribers within the Area to which it or its sub Operators is providing the Channel services including each dwelling for purposes of verification.
ARTICLE 3: COMMERCIAL TERMS AND CONDITIONS OF AGREEMENT
3.1 SUBSCRIPTION AMOUNTS AND REVENUE SHARE ARRANGEMENTS.
A. SUBSCRIPTION AMOUNTS
3.1.1 Subject to the provisions set forth herein in this Agreement, and in consideration of the rights granted by the Broadcaster under this Agreement in terms of clause 2.1 of Article 2, the Affiliate agrees to pay to the Broadcaster the Subscription Amounts, determined as per the Revenue Share Arrangement indicated herein below, per subscriber per month and as specified in Annexure A for the services indicated in clause 1.1 of Article 1 of this Agreement and within the time limits as indicated in this Agreement.
3.1.2 The Broadcaster shall have the right to vary the Subscription Fees after giving notice of not less than one month to the Affiliate and in compliance with the applicable law in force. The Total Subscription Amounts payable by the Affiliate to the Broadcaster shall also vary accordingly.
8 B. REVENUE SHARE ARRANGEMENTS
3.1.3 The subscription amounts payable to the Broadcaster by the Affiliate shall be calculated with reference to the subscription fee indicated in Annexure A in respect of each channel or bouquet of Channels multiplied by the number of subscribers as recorded in the Subscriber Management System installed at the Head End of the Affiliate to be availing such service for each month. The revenue share arrangement for the purpose of calculating the subscription fee for each channel or bouquet of channels shall be as per the formula indicated below:
I Maximum Retail Price of a subscribed pay channel or bouquet of channels as Annexure A per subscriber per month Rs. X II Percentage of Amount payable to the Broadcaster by the Affiliate, per subscriber per month 45% of X III Percentage of Maximum Retail Price to be retained by Affiliate (to be shared between the Affiliate and the cable operator) 55% of X
3.1.4 The total Subscription Amount along with any other payments statutorily required to be made by the Affiliate to the Broadcaster for each month shall be payable within 21 days from the close of the relevant month (after adjusting/deducting and retaining the portion of revenue retainable by the Affiliate as per 3.1.3(III) supra).
3.1.5 In the event of default in payment of the Subscription Amount, simple interest at the rate of 15 % per annum shall be paid by the Affiliate on the arrears of such Subscription Amounts which may remain unpaid at the end of the 21 days.
3.1.6 The parties may enter into a separate Agreement as regards payments to be made/ received on account of Carriage /Placement fee.
3.1.7 The entire advertising revenue for the Subscribed Channels shall pertain to the broadcaster.
3.2 CHARGES FOR EQUIPMENT INCLUDING INTEGRATED RECEIVER DECODER (IRD) IRD: The Broadcaster shall, supply or cause to supply the IRDs, on payment of the following charges:
(a) IRD Deposit & Processing Fees: Immediately upon execution of the Agreement the Affiliate shall pay such sums towards the processing fees per IRD (“Processing Fees”) and interest free refundable deposit per IRD (“IRD Deposit”), as required by the Broadcaster and specified in Annexure A. The Processing Fees and IRD Deposit are hereinafter collectively referred to as IRD Charges.
(b) Other Charges/ Taxes: The Affiliate shall pay courier charges, transportation charges, and all applicable taxes / levies, if any, for the IRD on actuals.
9 ARTICLE 4: RIGHTS AND OBLIGATIONS OF THE PARTIES
4.1 AFFILIATE’S RIGHTS The Affiliate shall have the right to subscribe and distribute the Subscribed Channels conferred through this Agreement and shall be conditional to the Affiliate’s performance of all its obligations and on the basis of the representations, warranties and declarations made by the Affiliate to the Broadcaster.
4.2 The Broadcaster shall give to the Affiliate access to the Subscribed Channels, subject to the Affiliate meeting the following mandatory eligibility conditions: -
4.2.1 The Affiliate provides an undertaking that it has all necessary licenses and permits required under the Applicable Law(s) for distributing the Subscribed Channels;
4.2.2 The Affiliate provides an undertaking that it has internal guidelines in place to comply with non-discriminatory access provisions specified by The Telecom Regulatory Authority of India (TRAI) in its Telecommunication (Broadcasting & Cable Services) Interconnection Regulation, 2004 and other relevant regulations and guidelines introduced by TRAI/ Government, from time to time;
4.2.3 The Equipment, CAS and SMS used by the Affiliate shall comply with the following requirements at all times during the subsistence of this Agreement: -
(i) The systems are capable of monitoring and printing historical data relating to subscriber activation, deactivation and reactivation, as the case may be;
(ii) CAS and SMS are integrated and any activation or de-activation is processed simultaneously through both systems;
(iii) The SMS enables the location of each set top box and Smart Card to be recorded;
(iv) The CAS and SMS is from a reputed, well-known organization, which is currently being used by other Pay Television Services and has a demonstrated track record of fulfilling the technical requirements under this Agreement.
(v) Covert and visible fingerprinting to be supported by all set top boxes which should be compatible for running fingerprinting whether operated by the Affiliate or by the Broadcaster.
4.3 BROADCASTER’S RIGHTS
4.3.1 In consideration of the grant of rights in terms of clause 1.1 of Article 1 of this Agreement the Affiliate shall pay to the Broadcaster, the following on the due dates with or without any deduction or set-off:
a) All Subscription Amounts and or all revisions or modifications thereof, due and payable to the Broadcaster shall be paid within the time period and in the manner and mode as may be agreed to between the parties and specified in Annexure A on the basis of specific invoices raised , whether or not the subscriber/ sub operator has been Invoiced or whether or not the payment is received by the Affiliate from his subscriber / sub operator and irrespective of any discounts or other concessions given by Affiliate to its subscribers or commercial operators.
10 b) Any other sum payable by the Affiliate to the Broadcaster under the terms of this Agreement.
c) Any other payments statutorily required to be made by the Affiliates to the Broadcaster.
4.3.2 In case the payment is not received by the due dates, a simple interest at the rate of 15% per annum from the date of default will be charged from the Affiliate without prejudice to any other rights of the Broadcaster. For this purpose the due date shall be the twenty first day of the calendar month following the month in which the Services were subscribed.
4.3.3 The Affiliate shall be responsible for payment of all taxes, levies, charges imposed by or under a statute, law, regulations, relating to the Services and payable by the Affiliate as also for collection of such amounts attributable to such taxes, levies, charges imposed by or under a statute, law, regulations, relating to the Services and payable by the Broadcaster and for remitting the same promptly to the Broadcaster with in the respective due dates.
4.3.4 If the Subscription Amount, or any other amounts payable to the Broadcaster as specified in this Agreement is not paid by the Affiliate on due date, the Broadcaster may take all or any of the following actions without prejudice to any other rights but subject to the applicable rules/regulations, if any, issued by the Competent Authority including issuance of prescribed notice stipulated by the Interconnection Regulations.
4.3.4.1 De-authorize the reception of Broadcaster’s services by Affiliate, his agents and/or his subscribers subject to the compliance of the applicable rules /regulations of the Competent Authority.
4.3.4.2 Terminate this Agreement, by giving Notice required under this Agreement and subject to compliance of the Applicable Laws in force.
4.3.4.3 Immediately take back possession of the IRD(s) belonging to the Broadcaster;
4.3.4.4 Charge a simple interest at the rate of 15% from the date such amounts became due until they are fully paid;
4.3.4.5 Intimate all the subscribers of such non-receipt of subscription amounts or other charges and consequences thereof on the subscribers.
4.3.5 Any discounts, special schemes, free periods etc as offered by the Affiliate to its agents or subscribers or sub operators shall be at the cost and responsibility of the Affiliate. No burden of such discounts or other promotional schemes shall be passed on to the Broadcaster.
4.3.6 The Affiliate shall not make his subscribers take other channels or services or fulfill any other commercial consideration as a precondition to receiving the Broadcaster’s channels or services.
4.3.7 In the event the Affiliate is required under the Income Tax Act, 1961 to withhold or deduct tax or other duties or levies that are required by law to be made from a payment due under the Agreement (including without limitation, the Subscription Amounts), all of the following conditions shall apply:
11 a) The Affiliate shall, promptly upon becoming aware that it is required to make any withholding or deduction (or that there is any change in the rate or the basis of a withholding or deduction), notify Broadcaster accordingly;
b) The Affiliate shall deliver to Broadcaster, receipts, certificates or other proof evidencing the amounts (if any) paid or payable in respect of any such withholding or deduction and the Affiliate shall co-operate in completing any requirements necessary to obtain authorization to make that payment without any withholding or deduction.
4.3.8 The Subscription Amounts payable by the Affiliate to the Broadcaster shall be exclusive of all government taxes, levies, cess, including service tax, education cess, etc., save and except the withholding as provided under the Income Tax Act, 1961.
The Subscription Amounts shall accordingly be increased to the extent of such government taxes, levies, cess, etc.
4.4 AFFILIATE OBLIGATION ON RECEPTION AND DISTRIBUTION OF SERVICE
4.4.1 The Affiliate shall at its own cost and expense cause the Subscribed Channels as specified in Annexure A to be received only from the designated satellite(s) as notified by Broadcaster from time to time, and shall distribute the Subscribed Channels to subscribers via the Permitted Distribution System using the same original audio and visual signals and sound tracks (including any stereo tracks) as provided by the Broadcaster to the Affiliate, in accordance with the restrictions, terms and conditions set forth herein and in an encrypted/ scrambled form using encryption and CAS that are capable of Fingerprinting.
4.4.2 The Affiliate shall be responsible, at its sole cost and expense, for obtaining all licenses and permits necessary to carry on its business as contemplated herein;
4.4.3 The Affiliate shall use its best endeavor within all its means and control to maintain a high quality of signal transmission for the Subscribed Channels. The Affiliate further agrees and undertakes that it shall cause continuous distribution of the Subscribed Channels to all its subscribers during its telecast without blacking it out or interfering with it in any manner whatsoever, subject however to such continuous and high quality of service being provided by Broadcaster;
4.4.4 The Affiliate shall ensure that the Permitted Distribution System is maintained on a standard capable of delivering as per Bureau of Indian Standards Act, 1986 (“BIS”) specifications broadcast quality signals to subscribers, and that the Subscribed Channels are distributed to subscribers at such broadcast quality level, which in any event should be no less favorable than the quality of signal delivered by the Affiliate to its subscribers for any other channel.
4.4.5 The Affiliate shall comply with all laws and regulations affecting its marketing, sale and distribution of the Subscribed Channels in the Area in connection with its performance under the Agreement including, without limitation, (i) obtaining and maintaining all relevant approvals, consents and registrations and (ii) paying all charges, levies and duties imposed on or charged to it under any law or regulation or by any Government Authority;
4.4.6 Without prejudice to the above general obligations as above the Affiliate subject to the terms of this Agreement shall take the following steps as set out herein under:
12 a) The Affiliate shall on receiving the encrypted signals as prescribed by the Broadcaster shall decode the same using an IRD which is compatible with the CAS of the Broadcaster, b) After receiving the Signals and decoding the same, the Affiliate shall reencrypt the signals with his own CAS and further distribute the encoded signals through cable networks only to those subscribers who have installed set top boxes and whose names and complete details are properly entered in the CAS & SMS, as per their choice/ request for individual channels on an a-la-carte basis or number of channels of the different bouquets on offer as opted by the subscriber. The abovesaid receiving of signals and de-encoding shall be done only at the head end address as mentioned in the Affiliation Registration details to this Agreement or as approved by the Broadcaster by an appropriate addendum to the same. The re-encrypting and further transmission shall be done only through the coaxial or optic fiber cable network of the Affiliate or of his authorized sub operator only and shall not be transmitted even partially or intermediately through any other means such as satellite, head-end in the sky, very small aperture terminal (v-sat), internet, etc.
c) The Affiliate shall maintain complete records of its subscribers, commercial operators, their viewership details, like addresses, services taken, periods for which they were taken, d) The Affiliate will not distribute the services to subscribers out of the area without the prior written permission of the Broadcaster, e) The Affiliate may provide the services to the subscribers either by himself or through his sub operators, f) The Affiliate shall be responsible for making all payments under this Agreement notwithstanding any default by his sub operators and subscribers, g) The Affiliate is obliged and shall endeavor in the task of protection of Broadcaster’s intellectual property rights, preventing piracy of the Broadcaster’s services, disclosing correctly all the information as required by the Broadcaster, distribution by commercial operator only to persons in the Affiliate’s SMS database and operating within the limits of the subscription rights as conferred in terms of this Agreement. The Affiliate shall endeavor in the task of ensuring that the subscribers shall not further distribute the Broadcaster’s services to others whether or not for commercial consideration. It is understood that these obligations would comprise of taking all necessary steps promptly within the control of the Affiliate.
4.4.7 The Affiliate shall take all necessary actions to prevent any unauthorized access to the Subscribed Channels in the Area and shall obtain and provide to Broadcaster regularly updated piracy reports at least once every quarter. The Affiliate shall take appropriate remedial actions to curb piracy in the Area.
4.4.8 The Affiliate undertakes that it shall not either itself, or through others acting on its instructions, copy, store or otherwise reproduce any part of the Subscribed Channels.
The Affiliate further undertakes that it shall not copy or store programmes for resale or deal in any copied programmes and shall immediately notify the Broadcaster of any unauthorised copying, storage or use of any part of the Subscribed Channels and shall fully cooperate with all requests by Broadcaster to take such steps as are reasonable and appropriate to cause such activities to cease. It is understood that this does not apply to subscribers having STBs in their houses which have the capacity to record and playback programmes.
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4.5 AFFILIATE OBLIGATIONS ON SUBSCRIBER REPORTS
4.5.1 The Affiliate shall prepare and provide to the Broadcaster complete and accurate monthly reports (“Subscriber Report”) for the Subscribed Channels within 15 days after the end of each month detailing:
i) Total number of subscribers, including their names and addresses and the Subscribed Channels on the first day and the last day of the month subscribed to;
ii) Maximum Retail prices charged for the tiers that include Subscribed Channels;
iii) Details of tiers that include Subscribed Channels offered to the subscribers (details such as channels in each tier and number of the subscribers subscribing to each tier);
iv) Such other information as Broadcaster may require for determining the Subscription Amounts.
Upon Broadcaster’s written request, the Affiliate shall provide number of subscribers by category, tier, location, sub-operator/last mile operator that Broadcaster may require with prior intimation and sufficient Notice to the Affiliate
4.5.2 Each Subscriber Report shall be signed and attested by an officer of the Affiliate of a rank not less than Head of Department/Chief Financial Officer responsible for the Affiliate’s SMS, who shall certify that all information in such Subscriber Report is true and correct. The Affiliate acknowledges that any requests for further information from time to time by the Broadcaster would not be unreasonably withheld. This obligation shall survive termination of the Agreement until Broadcaster receives the Subscriber Reports for each relevant month and all outstanding monies have been paid.
4.6 OBLIGATIONS REGARDING EPG (ELECTRONIC PROGRAMME GUIDE) The Affiliate shall create an electronic programming guide (EPG) which shall contain the details of programming schedules of each of the channels and for that purpose the Broadcaster shall provide to the Affiliate the required information in a format that is requested by the Affiliate.
4.7 PACKAGING, PLACEMENT AND PROMOTION RELATED OBLIGATIONS a. Apart from the packages provided by the Affiliate the channels should also be offered on an a-la-carte basis.
b. In addition to the other packages/ tiers, including the Subscribed Channels of the Broadcaster, offered by the Affiliate to the subscriber, the Affiliate shall also offer the Subscribed Channels to subscribers in the same bouquets as offered by Broadcaster to the Affiliate.
4.8 MARKETING OBLIGATIONS
4.8.1 In all its marketing efforts including but not limited to on-air and off-air promotion, the Affiliate would provide the Subscribed Channels:
i) An equivalent amount of marketing support as it provides to channels of the same genre;
14 ii) Equal treatment in all its material whereby Channel logos or names appear with the same size and prominence and page as other channels;
iii) Equal opportunity to participate in events/promotions the Affiliate undertakes.
4.8.2 The Affiliate shall not use the Channel Marks or the Broadcaster’s trade names or trademarks in any manner that is not expressly provided in the Agreement, unless it has obtained the prior written agreement of Broadcaster. For the removal of doubts, the Affiliate shall not use the Broadcaster’s trade names or trademarks in a manner that will adversely affect the goodwill and reputation of Broadcaster and its products and services.
4.8.3 The Affiliate acknowledges that Broadcaster shall have the sole discretion to approve the use of Channel Marks by the Affiliate, including with respect to the programmes included in the Subscribed Channels. The Affiliate further agrees that that by reason of the Agreement, it shall not acquire any proprietary or other rights or interest in the Channel Marks.
4.9 OBLIGATIONS OF INTELLECTUAL PROPERTY RIGHTS AND RIGHTS PROTECTION
4.9.1 The Affiliate shall use its best efforts to promote an awareness of the Subscribed Channels among its subscribers and potential subscribers.
4.9.2 It is expressly agreed and understood that the Affiliate shall not acquire any intellectual property rights, ownership or other rights, including but not limited to rights relating to any trade marks, service marks or copyrights (whether registered or unregistered), with respect to the Subscribed Channels or Additional Channels except as expressly set forth in the Agreement, nor shall the Affiliate grant to others, the right to use the Subscribed Channels or any other rights in and to the Subscribed Channels except as specifically set forth in the Agreement.
4.9.3 The Affiliate shall not acquire and agrees not to take advantage of any legal possibility to acquire any proprietary or other rights in the trade names and marks to which the Broadcaster or its principals (the owners or the channel providers of the Subscribed Channels) assert proprietary or other rights ("Channel Marks") and further agrees not to use the Channel Marks in any corporate or trade name.
4.9.4 The Affiliate agrees that upon discovering or coming to Notice of any actual or impending infringement or unauthorised use by or through the subscribers of the Channel Marks or any other intellectual property rights or ownership rights relating to the Subscribed Channels, the Affiliate shall immediately report to Broadcaster with full details.
4.10 SUBSCRIBER RECORDS, ACCESS & AUDIT RIGHTS
4.10.1 The Affiliate shall keep accurate, complete and up to date records of every subscriber’s details, details of the location of every set top box, Smart Card, records and accounts of billings including historical billing data, type of subscribers, sublicenses and all relevant matters (“Subscriber Records”). The Affiliate shall ensure that its SMS and billing software allows for monitoring and printing historical data relating to subscriber activation and/or deactivation, going back to at least 12 months at any point of time.
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4.10.2 The SMS and all Subscriber Records that are relevant to the Subscribed Channels for the operation of the Agreement shall be available for inspection and audit by Broadcaster/Broadcaster’s representative(s) (where such representatives are members of an internationally recognized accounting firm and agree in writing to be bound by confidentiality obligations) during the Term at any time during normal business hours and for three months after the expiry or premature termination of the Agreement, as the case may be, to ensure compliance with the Anti-Piracy Obligations, and (ii) on three days prior written notice during normal business hours to ensure compliance with all other terms of the Agreement up to four times within any 12-month period and for three months after the expiry or premature termination of the Agreement, as the case may be. The Affiliate shall give Broadcaster/Broadcaster’s representatives any assistance they may reasonably require in connection with their audit investigations. In the event a breach of the Agreement has been discovered during the course of such audit or inspection, Broadcaster/Broadcaster’s representatives shall have the right to take printouts, photocopies and computer copies of the Subscriber Records, or any portion