Zee is shunning the free-to-air delivery of all its channels and opting for the pay channel route. This move will effectively tag a charge on each of the 15 channels in its bouquet. It remains to be seen whether the increase in the Zee subscriptions would be passed on to the consumer or would be borne by the cable operators.
This planned hike is in tune with Goldman Sach’s forecast on Zee’s earnings. Goldman had hinted that Zee’s earnings will grow more than 2 per cent in the year beginning April if it regains viewer share and manages to recover more pay or subscription-revenue from the cable operators.
The entire bouquet will become pay channels with a package subscription rate ranging between Rs 20-30. By May this year, Zee TV, Zee News, Zee Education(ZED) Zee Music and the about to be launched Zee Telugu are all set to take up the pay mode.
Till now, Zee was offering a 5-channel package costing Rs 13 to any cable operator which included, Zee Cinema, Zee Alpha, Nickelodeon, Zee English, Zee-MGM.
An analyst pointed out that this bundling by Zee would peg it against Star’s pay channel bouquet more effectively. Industry observers said that Zee’s move to banish the free-to-air route of its channels might not meet resistance from the cable networks.
The recent subscription rate hikes by Star and Turner did not adversely effect their Direct-To-Operator connectivity. So, Zee should not have much of a problem pushing the rates to the cable operators.
Meanwhile, Zee has decided to unbundle several packages for the cable operators. Unlike the others, Zee will offer package rates to the networks comprising a sub-set of channels. Zee will not negotiate it’s entire channel bouquet with the cable networks.