Regulators are taking different approaches to licensing IPTV providers. Sometimes the licensing requirement is based on the service being offered rather than the particular platform used to offer it – in other words, a technology-neutral approach. To the extent an IPTV provider is offering live television, for example, it may subject to the same licensing requirements imposed on television broadcasters. Europeans are following a technology-neutral approach that considers any television service − provided over any platform (cable, satellite Internet, ASDL, or mobile network) − a broadcasting service. In France, for example, an IPTV operator must submit a declaration to the Conseil Superieur de l’Audiovisuel (CSA), although small operators with annual programming budgets of less than EUR 150,000 are exempted from this mandate.[1] Similarly, Canada requires any television service, including VOD, provided over a managed IP network to have a “Broadcast Distribution Undertakings” licence. In Europe, however, VOD is not considered a television service due to its interactivity.
|
Pakistan’s IPTV Channel Distribution Service Licence |
| Issuing Authority |
Pakistan Electronic Media Regulatory Authority |
| Primary Requirements |
Must hold Fixed Local Loop Licence from PTA for each region to be served |
| Company must be incorporated in Pakistan |
| Majority of shares cannot be owned or controlled by foreign nationals or any entity whose management control is vested in foreign nationals |
| Coverage |
Per Zone: Two Categories, A and B (Category A – 4 zones including Karachi and Islamabad; Category B – 10 zones) |
| Fee Structure |
Application Processing Fee: Rs 20,000 (approx. USD 320)
Category A licences: Rs 1,000,000 (approx. USD 16,000) per zone Category B licences: Rs 500,000 (approx. USD 8000) per zone |
| Security Deposit |
10 per cent of licence fee (refundable after 1 year after satisfactory operation) |
| Licensing Term |
5 years |
| Annual Renewal Fee |
30 per cent of the licence fee plus 5 per cent of the annual gross revenues | Source: Pakistan Electronic Media Regulatory Authority, Guidelines for Submission of Statement of Qualifications for IPTV Channel Distribution Service Licence |
In countries such as the Republic of Korea, Pakistan, and Singapore, the broadcasting authority has developed new licences to IPTV services. Under the Republic of Korea’s new
Internet Multimedia Broadcasting Business Act, IPTV providers must get an “Internet multimedia broadcasting” licence from the Minister of Information and Communications. In Pakistan, IPTV providers must not only obtain an “IPTV Channel Distribution Service” licence from the Electronic Media Regulatory Authority to provide service, they must also hold a Fixed Local Loop licence for the same areas (see figure above).
In 2007, Singapore’s Media Development Authority (MDA) developed a technology-neutral licensing framework to facilitate the introduction of new media services like IPTV. All media service operators seeking to offer IPTV services (or any form of subscription television services) now require a licence from MDA. That agency defines IPTV as the transmission of television programming, in the form of either full scheduled channels or video-on-demand, to households via a broadband, IP connection. Using the IPTV network, service providers can also offer rich interactivity and services such as television commerce, VoIP, video conferencing, and gaming (see figure below).
Singapore’s new framework, however, applied ownership restrictions under the Broadcasting Act to nationwide licensees with more than 100,000 subscribers − but not to niche licensees with fewer than 100,000 subscribers. The disadvantage of this two-tier distinction is that as licensees grow their subscriber base, they may find themselves forced to divest foreign ownership, since the Broadcasting Act prohibits a foreign entity from holding more than a 49 per cent interest. MDA is proposing a similar two-tier ownership approach for mobile TV providers.
| Singapore’s Two-Tier Licensing Framework for IPTV Services |
|
Niche Subscription TV Licence |
Nationwide Subscription TV Licence |
| Number of subscribers |
100,000 subscribers |
Unlimited number of subscribers |
| Licence term |
5 years |
10 years |
| Licence fee |
2.5% of total revenue; minimum annual licence fee of SGD 5,000 will be applicable during duration of licence. New service licencees may enjoy a concessionary rate of 0.5 per cent of total revenue or SGD 5,000, whichever is the higher amount during first three years of licence term |
2.5 per cent of total revenue; minimum annual licence fee of SGD 50,000 per annum will be applicable throughout. New service licensees may enjoy a concessionary rate of 0.5 per cent of total revenue or SGD 50,000, whichever is the higher amount during first three years of licence term. |
| Performance bond |
SGD 50,000, in the form of either banker’s guarantee or cash. |
SGD 200,000, in the form of either banker’s guarantee or cash. |
| Ownership |
No ownership conditions |
Subject to ownership restrictions set forth in Part X of Broadcasting Actb |
| Must carry |
Not applicable |
Must carry obligations for enabling access to local free-to-air channels are applicable |
| Advertising revenue |
No cap on advertising revenue |
Advertising revenue not to exceed 25 per cent of total revenue |
| Advertising time limit |
14 minutes per hour advertising time limit applies for channels with scheduled programming (not applicable for VOD content and interactive advertising services. |
| Content guidelines |
Subscription TV programme code applies if scheduled programmes are offered. VOD programme code applies if on-demand programmes are offered. | Source: Media Development Authority of Singapore, www.mda.gov.sg/wms.www/devnpolicies.aspx?sid=88#3 |
Hong Kong, China has not established a special licence category for IPTV providers. Instead, it regulates IPTV providers in the same manner as a subscription television provider, requiring them to obtain a domestic subscription television programme licence. However, as in Pakistan, such licences can only be obtained if the operator already holds a fixed network licence.
India’s regulator, TRAI, has recommended that IPTV telecommunication providers be regulated under the terms of their telecommunication licence, and that cable operators be regulated under the terms of the Cable Television Network (Regulation) Act, 1995. TRAI has indicated that IPTV services provided by telecommunication operators are not the same as a cable service. This judgment was based on the technical aspects of the services and the manner in which the content is delivered to the user (cable channels are pushed to the user whereas IPTV channels are pulled by the user).
TRAI recommended that telecommunication service providers holding a “Unified Access Service” or “Cellular Mobile Telephony Service” (CMTS) licence be allowed to provide IPTV services under their licences, without any further approval.[2] ISPs with a net worth of more than a billion Rupees (approximately USD 25 million) would be allowed to provide IPTV services after obtaining permission from the regulator. Similarly, cable television operators could offer IPTV services under their current authorizations.
ENDNOTES
[1] OECD, IPTV: Market Developments and Regulatory Treatment, DSTI/ICCP/CISP(2006)5/FINAL, at 24 (Dec. 17, 2007), available at www.oecd.org/dataoecd/11/23/39869088.pdf.
[2] Telecomm. Reg. Auth. of India (TRAI), Recommendations on Provision of IPTV Services, at 18-20 (Nov. 28 2007).