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Value addition becoming clincher for DTH firms
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#1
After his wedding last September, Ashutosh Kumar used to watch at least one movie in a multiplex every weekend with his wife. The ambience of the theatre prompted the movie buff in him to shell out Rs 300 for two tickets. The habit, however, changed soon after he got a direct-to-home (DTH) connection this January.

“With my home-theatre, I could watch the same movies, obviously after a week or two of their release, on my couch in the drawing room. The best thing is that the movies-on-demand service that my DTH operator provides lets me watch the films at a fraction of the cost,” Kumar says.

Movies-on-demand (M-o-D), one of the value-added services (VAS) that DTH operators provide, is gaining substantial popularity amongst subscribers. “We are seeing a lot of interest from small cities as well as metros for this service. Though the contribution of VAS in our revenue would be negligible, the usage is growing at a very fast pace. Two of our other services, like the tie-up with Monster.com for jobs and the matrimonial services on offer, are also seeing good response,” says Salil Kapoor, chief operating officer, Dish TV, which has 6.6 million subscribers.

Apart from movies, there are other interactive services such as cooking lessons, recipes on demand and educational services which are key differentiators between operators. “Since the launch of our services there has been two million buys for the movies we offered. Slumdog Millionaire had seen 75,000 purchases and this service is doing very well,” said Vikram Mehra, CMO, Tata Sky, the second largest DTH player.

Mehra said educational interactive services are finding as many takers as movies. “Our Active English service got 100,000 users in less than two months and at Rs 30 per month, consumers are keen to buy this service,” said Mehra. Tata Sky presently has 4.5 million subscribers in the country.

The industry expects the number of DTH subscribers to grow by around 10 million to reach 30 million by this December, from 20 million today. Various value-added services provided by operators are daily astrology, news, sports, games, information on different events and movie timings in the city and some internet-based services.

At present, there are seven DTH players in the country: DD Direct, Dish TV, Tata Sky, Sun TV, Big TV, Airtel DTH and Videocon.

Sugato Banerji, chief marketing officer, DTH, Bharti Airtel, says M-o-D was a growing segment for the company and for a new movie on offer, around 30,000 subscribers demand it. The number of VAS users is steadily growing in line with the industry, which is itself in a nascent stage, Banerji says. Bharti Airtel DTH has a subscriber base of two million.

“M-o-D as a service is the leader amongst the VAS provided by operators and this is because lots of movies are coming to the DTH platform soon after their theatrical release,” says executive director, KPMG, Jehil Thakkar. The M-o-D service is available on DTH for anything between Rs 25 and Rs 100, depending on the operator and the movie. A new movie typically commands a premium over the old ones.

“The global standard for VAS users on the DTH platform is a maximum of 10 per cent. When a good movie is offered, 3-3.5 per cent users opt for the M-o-D service. In India, the number of users for the service is also affected due to the rampant piracy that occurs. The number can grow at a higher pace if movies are simultaneously released in theatres as well as through DTH,” says Banerji.

A pirated DVD of a new movie is available for as low as Rs 50, a huge concern for the Indian film industry. Operators are increasingly trying to strike deals with producers to showcase new films. For example, on the fourth day of its release in theatres, UTV’s Main aur Mrs Khanna was being screened on DTH. Kaminey, one of the big hits of 2009, was on DTH within four weeks of its theatrical release. Hit movies like Love Aaj Kal and Wanted have also been shown and Bharti Airtel DTH will be screening Ishqiya from Saturday.

Anil Khera, the chief executive of Videocon D2H, the latest entrant in the industry, says the usage of VAS is going up steadily, month-on-month. “We started our business in the second half of 2009, so the numbers are not huge but we are seeing a traction taking place,” Khera said.

Thakkar said that as people get more familiar with the VAS offerings, usage will also pick up. “Presently, operators are focused on getting more subscribers into the fold. Once they have the subscribers, the focus will shift to average revenue per user and that is when VAS usage will grow at a fast pace,” he said.

[Image: logo_08.jpg]

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#2
The Value added service has definitely made DTH stand out from regular cable television as the activities that can be performed ranging from watching Latest movies to other active service has dispersed a wider sense of advance utility.
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