It is happening. When the government mandated a deadline for cable digitisation last year, the bets were that cable companies wouldn’t be able to cope and DTH (direct-to-home) operators would step in. They have. The total base of DTH subscribers in India grew to a massive 44.4 million homes in 2011, up from 25 million in 2010, according to data released by Singapore-based consulting firm Media Partners Asia (MPA). That is a massive 77 per cent increase over the last year.
DTH now penetrates 30 per cent of India’s 148 million television households, just over twice the number that analog cable does (84 million). The Rs 32,000-crore Indian TV market gets the bulk of its revenues (about 60 per cent) from the money subscribers pay to access DTH or cable services. The growth of DTH then is encouraging for investors, who have put in an estimated $3 billion or more into this market so far. While data for all players is not available, most analysts reckon that the bulk of the players have not broken even.
The big surprise in the MPA report is Videocon. Just about a year back, its brand D2H was considered the weakest in the market and there were rumours that it was up for sale. It has, however, shown strong growth and has actually gone ahead of Reliance’s Big TV to get over 11 per cent of total subscribers. It is now planning to sell a minority stake (20-25 per cent) to a private equity firm, says MPA. The Rs 1,436-crore Dish TV, part of the Zee Group, retains its top slot with 28 per cent share (of volumes), with Tata-Sky a distant number two at 18.6 per cent..
Phase one of cable digitisation covers the metros and is supposed to be over by the end of June this year. This phase represents roughly 10 per cent of the analog cable universe or over eight million subscribers. It is possible that cable operators may not manage to digitise these many homes by June. There was some talk of extending the deadline earlier this month. However DTH’s ability to cash in on cable’s unpreparedness in these markets is suspect because of the lack of KU band capacity that DTH transmission needs. According to the MPA report, Dish and Airtel are the only operators well placed in terms of channel capacity for the first phase.
