The Hindu Business Line : Bharti cuts stake in DTH venture

New Delhi May 2 Bharti Airtel has reduced its share in its wholly owned DTH venture, Bharti Telemedia Ltd, to 40 per cent. The move has been taken to comply with the guidelines on FDI in the DTH sector. Total foreign equity holding in DTH company including FDI, NRIs and financial institutions cannot exceed 49 per cent and within the foreign equity, the FDI component should not exceed 20 per cent.

Since Bharti Airtel has an FDI component of 48 per cent, it cannot hold the entire stake in Bharti Telemedia. A Bharti group company will hold the balance 60 per cent. This will keep the FDI level in Bharti Telemedia to under the permitted 20 per cent.

Bharti has applied for a DTH licence and compliance to the FDI norms is necessary before the Government can clear its application. Bharti's DTH venture is expected to roll out by the end of this calendar year. It was initially planned to keep the venture under Bharti Airtel, the telecom business of the Bharti Group, to leverage synergy with broadband services.

Bharti's manufacturing arm Bharti Teletech is also set to produce set-top boxes for DTH services.

Telecom companies are increasingly looking to foray into the broadcasting segment. Currently, there are three players in the DTH market -DD Direct, Tata Sky and Dish TV, and a fourth Sun Direct is expected to launch its services shortly. Reliance Communications, the second largest private telecom company, is also planning to foray into the DTH space. Telcos are also deploying other broadcasting technologies such as IPTV (Internet Television Protocol) that allow subscriber to receive TV content through telephone lines. Companies including BSNL, Bharti and MTNL are all set to roll out IPTV in a big way. Wireless telecom operators are also betting big on mobile TV with technologies such as DVBH and Media Flo. Analysts pointed out India is all set to overtake Japan as Asia's largest satellite direct-to-home market by next year. Researchers at Aseambankers said that India was on target to be Asia's leading cable market by 2010 and the most lucrative pay-TV market by 2015.

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