Advertisement


Advertisement

Thread Rating:
  • 3 Vote(s) - 3 Average
  • 1
  • 2
  • 3
  • 4
  • 5
Help DTH turns a corner as costs ease, subscribers rise
Advertisement
#1
After years of depressed growth, the direct-to-home industry is likely to improve over the next two years as costs declined, companies aggressively increased their subscriber base and the market leader broke even.

However, profits at loss-making DTH providers, bogged down by high subscriber acquisition costs, selling and marketing expenses and low revenue per user, might take longer, analysts said.

"Like in a lot of businesses, the first round of economic destruction has taken place. The business has bled, but from here on, the industry will take off," IDFC Securities analyst Nikhil Vora said.

Salil Kapoor, chief operating officer at Dish TV, said the Indian DTH industry should have 33 million subscribers by the end of this year and expects it to be the largest globally, overtaking the US, much earlier than analysts' projections of 2012.

The historically high subscriber acquisition costs — cost the DTH provider records for each subscriber — have stabilised over the last one year. Subscriber acquisition costs, which were initially as high as Rs 6,000, have now stabilised at somewhere between Rs 3,000 and Rs 4,000, said Anil Khera, chief executive at Videocon D2H, a unit of Videocon Industries.

Subscriber acquisition costs should fall by 20 per cent in the next two years, an analyst, who did not wish to be named, said. "Subscriber acquisition costs should definitely come down because of stabilisation in price war and reduction in the price of set-top boxes," he said.

Dish TV launched its DTH services in 2005, becoming the first entrant in the Indian market. Tata Sky, Sun TV Network's Sun Direct, Reliance Big TV, 's Airtel Digital TV and Videocon D2H jumped in later, setting off a price war to gain subscribers in an analog-dominated market.

Prices of set-top boxes, a large chunk of the subscriber acquisition cost, have dropped considerably over the years, especially in markets such as China and Taiwan. Service providers such as Videocon D2H are also manufacturing their own set-top boxes to cut down on costs and avoid import duty.

DTH OPERATORS IN INDIA

* DISH TV

A division of Zee Network Enterprise
Launched operations in 2005
Number of subscribers: More than 9 million

* TATA SKY

A joint venture of Tata Group and News Corp's STAR
Launched operations in 2006
Number of subscribers: About 5.5 million

* SUN DIRECT

A part of Sun TV Network
Launched operations in 2007
Number of subscribers: More than 6.4 million

* RELIANCE BIG TV

Part of Anil Dhirubhai
Ambani Group's Reliance Communications
Launched operations in 2008
Number of subscribers: About 3 million

* AIRTEL DIGITAL TV

A part of Bharti Airtel
Launched operations in 2008
Number of subscribers: More than 4.7 million

* VIDEOCON D2H

A part of Videocon Industries
Launched operations in 2009
Number of subscribers: More than 2 million

Additionally, the rupee's appreciation against the dollar is also pushing the cost down. The rupee has appreciated 3.2 per cent against the dollar so far this year.

MUTED ARPUs COULD EDGE UP
Cut-throat competition has so far kept average revenue per user (ARPU) subdued, but going forward DTH companies could see ARPU rising to Rs 225-260 in the next three years from the current Rs 140-150, Vora said.

Changes in the content sharing agreements between broadcasters and service providers are also helping DTH companies reduce costs to a certain extent.
bs
Reply
Thanks given by:
Advertisement
Advertisement




Possibly Related Threads...
Thread Author Replies Views Last Post
  General News: DTH Subscribers Are Saving Money With TRAI’s New Rules, Says I&B Ministry nairrk 1 713 06-25-2019, 04:54 PM
Last Post: Hassan Syed
  Update: Star India urges Airtel Digital subscribers to switch nairrk 0 1,122 03-24-2018, 02:39 PM
Last Post: nairrk
  DTH News: DishTV renegotiating with broadcasters to reduce content costs nairrk 0 867 08-18-2017, 10:33 AM
Last Post: nairrk
  DTH News: Sun Direct turns profitable at net level for full fiscal for first time nairrk 0 745 07-18-2017, 10:04 AM
Last Post: nairrk
  DTH News: DTH inactive subscribers grew 5.2% to reach 34.4 mn: TRAI nairrk 0 950 04-10-2017, 09:20 AM
Last Post: nairrk
  DTH News: DTH adds 14 lakh active subscribers in Q2-17 as per TRAI data nairrk 0 1,128 01-04-2017, 10:26 AM
Last Post: nairrk
  DTH News: Active subscribers comprise 65.42% of 94.61 mn total DTH universe nairrk 0 707 01-03-2017, 10:48 AM
Last Post: nairrk
  DTH Updates: Videocon D2H to merge with Dish TV; serve 28 million subscribers nairrk 0 853 11-12-2016, 07:46 AM
Last Post: nairrk
  DTH News: Inactive DTH subscribers shrink dramatically in TRAI’s new report charger 0 694 05-19-2016, 03:27 PM
Last Post: charger
  India’s DTH base ends 2011 with 45 million subscribers IndianDTH 0 3,067 03-07-2012, 02:10 PM
Last Post: IndianDTH

Forum Jump:


Users browsing this thread: 1 Guest(s)
Advertisement