To ensure that delivery platforms owned by broadcasters don’t block competition /contents from others.
- Limit of restriction to increase from Company based to Entity based – If TRAI has to PUT restrictions on Crossholding ownership, then it has to take this move because no listed companies in media companies, is having direct ownership into distribution segment, ownership is based on group levels.
- Imposed 20% as an Upper Limit – Impact on the stock prices would be minimal as the authority has provided ample time of 3 years to an entity for restructuring their cross- holdings in distribution segment.
- No restriction on horizontal expansion – This move was more towards Print and Media companies because current global economic slowdown has severely impacted their advertising revenue than broadcasting companies.
Additionally, According to the recommendation, players like Essel group (via Dish TV and WWIL), Sun TV group (via Sun Direct in DTH and Sumangali cable Network in cable), Network 18 (via stake in DEN) and Star India (via Tata Sky in DTH and Hathway in cable), which are both TV broadcasters and distributors; have to restructure their holdings in their business within 3 years.
The players like Sun TV can be impacted as it can face competition going forward though at present the barriers to entry are quite high for other players as it is operating through Sun Direct (DTH) and Sumangali cable Network (Cable
distribution)