Financial Daily from THE HINDU group of publications
Thursday, Apr 20, 2006
Financial Daily from THE HINDU group of publications Thursday, Apr 20, 2006 |
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Marketing
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Marketing Research Industry & Economy - Radio/TV DTH space heats up Nina Varghese
Chennai , April 18 With more players likely to enter the direct to home (DTH) space, the reach to cable and satellite (C&S) homes, both in urban and rural areas, is expected to grow, say industry sources. According to a report by Media Partners Asia, a Hong Kong-based media think-tank, currently DTH remains the primary digital pay-TV platform in India. Dish TV, a DTH venture in which Zee Telefilms has a 20 per cent stake, had 7,50,000 pay-TV subscriptions in December 2005 and is expected to have reached approximately one million subscriptions by March 2006. Tata Sky, a $500-million DTH joint venture between the Tatas and News Corp, is expected to be launched after June and it plans to acquire around one million subscriptions by this year. DTH ventures from Reliance and Sun TV are also likely to come to the market over the next year or two, the report said. The plus for DTH is that it is backed by large corporates and vertically integrated media majors, both of whom will be able to subsidise set top boxes (STBs) and invest in programming, technology and marketing, the study said. A highly placed industry source said another advantage for the DTH subscriber would be the lack of interaction with the local cable operator. For instance, Tata Sky plans to introduce pre-paid cards. Mr Vikram Kaushik, CEO, Tata Sky, said pre-paid cards would make subscription payment easier for the consumer. Secondly, the hardware will also be available in all consumer electronic stores. Tata Sky plans to take the responsibility of directly installing the hardware in every subscriber's home and servicing it whenever needed, he said. The study said cable's advantage is its 64 million analog subscriber mass in India and its two-way broadband pipe (vis-à-vis DTH's one-way pipe). As a result, cable is likely to remain the dominant distribution platform for C&S channels over the long term. However, it could lose ground substantially in both digital distribution and broadband especially if consolidation of the last mile does not occur and digitisation does not gather momentum. Currently, one of the deterrents to DTH has been sharing of content between channels. Some effort is being made to work this out say industry sources. Said Mr Kaushik, "Tata Sky's endeavour is to get all existing popular channels on its platform. We are at various stages of discussions with all major broadcasters in this regard and are confident that they will come on the Tata Sky platform." Talking about DTH penetration into the rural areas, Mr Kaushik said the DTH service would reach every Indian home, however remote it may be. . In contrast to the global norms, the multi-system operators (MSOs) in India do not control the last mile, which is largely owned by the fragmented local cable operator(LCO) industry. In 2005, there were roughly 33,000 LCOs in India. The study said that in such a background, LCOs typically under-report subscription to the MSOs and broadcasters. The leading MSOs, including Siticable, Hathway and Incablenet, have a reach of about 16 million home (in aggregate 25 per cent of total cable households) but have the last mile ownership only for about three million homes with around 9,00,000 direct subscribers and the remaining 2.1 million derived through arrangement with LCOs.
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