Spats over prices are an inescapable phenomenon in the broadcasting industry and by the looks of it Sony and Hathway Cable and Datacom are gearing up for yet another battle.
Hathway said Sony, via its distributor MSM Media, has been demanding exorbitant prices for its channels for letting it renew its distribution agreement.
“The Subscription Agreement with MSM Media Distribution Private Limited for DAS (Digital Addressible System) Phase II areas had expired on 31.3.2015 and they have been demanding unreasonable hike from us for renewal of the agreement which was very unreasonable, unjustified,” Hathway said.
“Since the demand imposed by MSM Media Distribution Private Limited was unreasonable and unfair the talks between the parties were not heading towards any resolution.”
“Hence it was decided by the Company not to renew the subscription agreement for DAS Phase II areas.Thereafter MSM Media Distribution Private Limited issued disconnection notices on 16-07-2015 for DAS Phase II cities against Hathway Cable and Datacom Limited and after the expiry of 21 days notice period, the signals were disconnected by MSM Media Distribution Private Limited on 06.08.2015,” the cable company said.
Such spats are regular feature of broadcasting tie-ups across the world, and usually result in the channels being available to subscribers are reference interconnect rates.
RIO rates are usually very high, as they are published rates akin to the maximum retail prices printed on goods. Usually, Hathway is able to get channels well below RIO rates.
But if negotiations fail, Hathway can demand that Sony should provide the content at RIO rates. Hathway, in turn, will hike the prices of MSM channels for its subscribers to account for the new agreement.
For now, Hathway seems to be ready to fight it out, attacking Sony channels’ desirability.
“The concern with Sony Entertainment Television, the flagship channel of Multi Screen Media (MSM), has been witnessed over the last year wherein their content lacks appeal and demand as compared to other leading networks and does not deserve growth, which was raised by us to the broadcaster. All the other channels in the MSM bouquet are also irrelevant and don’t offer any compelling content,” it said.
“The content of the MSM channels were unappealing and there was a continued decline and in consistency in their rating. Dripping ratings and average content cannot be a base for a broadcaster to take distribution platforms for a ride by demanding hefty growth year on year. In fact, it requires major correction in the subscription fees that the broadcaster charges,” Hathway added.