The National Communications Commission (NCC) yesterday said that it will start its first arbitration meeting with cable service providers and satellite channel operators on Thursday to discuss a dispute over content authorization fees.
NCC spokesperson Wong Po-tsung (翁柏宗) said the dispute began last year as new cable service operators complained they were facing unfair treatment from satellite TV channel agents, who negotiated content authorization fees on behalf of the channel operators with all cable service operators.
“The new cable service operators said they have yet to attract subscribers, but they are asked to pay the same amount of content authorization fees as other cable operators, which is calculated by factoring in 15 percent of the number of registered households in the service area,” Wong said.
“The agents of satellite TV channels said that they were only charging a guaranteed minimum amount from cable system operators,” he said.
Sky Digital Convergence Service (全國數位天空), which is based in Banciao District (板橋), new Taipei City, has signed only 10,000 subscribers since the launch of its cable service last year, Wong said.
However, the content authorization fee that the cable operator has to pay is calculated by factoring in about 74,800 registered households in Banciao, he said.
The pricing mechanism charges all cable systems a fixed content authorization fee, regardless of the number of subscribers each cable operator has, Wong said.
He said this has caused new cable service operators to report the practice to the Fair Trade Commission, which ruled in October last year that major TV channel agents have given differential treatment to new cable operators and operators branching out to new areas.
As such, the agents were collectively fined NT$126 million (US$3.97 million), Wong said.
The new cable operators have also asked the NCC to step in to arbitrate the dispute, Wong said.
“The commission ruled last week that cable, video-on-demand and direct satellite broadcasting systems are considered broadcasting platforms. Content providers must not give differential treatment to different platform operators,” he said.
Asked if established cable operators could also argue that they are being treated unfairly for having to pay a higher content authorization fee than new cable operators, Wong said TV channel agents could consider adopting a progressive approach in charging new cable operators.
“Rather than a fixed content fee for all cable operators, the agents could lower the minimum guaranteed fee for new cable operators and gradually raise the fee to the standard level as the new operators expand their customer base. The negotiation should give room for all parties to survive,” Wong said.
Apart from investigating if channel operators had discriminated against new cable operators through differential pricing schemes, the commission would also investigate if the cable operators discriminated against certain channels by refusing to include them in their channel lineup, Wong said.
Cable operators must not suspend their services because of the dispute with channel operators, he added.
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