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DTH: Will it turn into another flop show?

27-December-2004
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DTH: Will it turn into another flop show?

Will direct-to-home (DTH) broadcasting take off in India? Four years after the government allowed it, there are no clear answers to that question yet. Industry insiders and domain experts argue that DTH could have a bright future in India, only if....

• “Anybody who can afford to pay will take DTH, if he gets value,” points out media lawyer Tamali Sengupta.

• “The future of DTH is good, if it is successfully implemented. Latent demand and pricing of the service will hold the key,” indicates Madison India general manager Basab Datta.

• “DTH would take off, if there’s exclusivity,” stresses media expert Sunil Kumar.

Regulatory norms, foreign investment restrictions and sectoral cap are being cited as the biggest roadblocks. While the recently announced ‘must provide’ norms are being termed a hindrance, the 20% FDI limit has been bit of a dampener too for DTH players. So is the 20% sectoral cap for broadcasters. Also, even as DTH is usually not a market for multiple players, India is witnessing a contrary trend, which could be a setback for the industry in the longer run, according to industry pundits.

While Zee chairman Subhash Chandra-promoted ASC Enterprises launched Dish TV end of 2003, public broadcaster Prasar Bharati kicked off its DTH venture recently. A third player, Space TV (a 80:20 joint venture between Tata Sons and Rupert Murdoch’s Star), is awaiting government clearance.

Apart from the multiple-player phenomenon, India is home to yet another peculiar model. It is perhaps the only market with a free DTH platform. Prasar Bharati’s DTH platform carries only free-to-air private channels, in addition to Doordarshan content. But, asks media expert Sunil Kumar: “Is Prasar Bharati DTH going to remain free forever? What’s the agreement with the consumers?”

According to Prasar Bharati CEO KS Sarma, the modalities will be reviewed after one year. And that includes a decision on keeping the service free or making it pay.

As for numbers, Prasar Bharati is learnt to have sold 5-6 lakh set-top boxes already for its DTH. ASC’s Dish TV is said to have crossed the magic figure of 1 million customer base. But critics argue that thousands of customers have been given set-top boxes free of cost to popularise the service. But doling out free boxes is quite a norm, when it’s DTH. UK’s BSkyB, for instance, had distributed free boxes at the time of launching its satellite service there. For the India market, Space TV is understood to be planning a similar rollout strategy.

Whatever the rollout model, content drives the DTH platform, says Ms Sengupta. In some developed markets, sports, movies and adult content are considered the backbone for direct-to-home or pay TV, as the case may be.

Consider the content on offer. Dish TV gives its consumers a mix of Hindi, English and regional channels of various genres. But, none of the channels from Star and Sony are on the Dish platform yet. Therefore, Dish TV may not be an attractive option for a consumer, if there’s more choice in the market, argues an industry insider. Meanwhile, both Star and Sony officials cite piracy issues as the reason for not joining Dish.

As for Prasar Bharati’s DD Plus, it has a mix of DD channels and a few free-to-air private channels (news and entertainment) — a total of 31 channels so far. This too is not seen as a hot offering for the city types, who have access to cable TV. But like Prasar Bharati’s Mr Sarma had said, “it’s a revolution” for those with don’t receive any cable TV signal. Currently, both Dish TV and DD Plus are targeting people in remote areas.

However, it may be a different game altogether once the Telecom Regulatory Authority of India (Trai) norm on ‘must provide’ comes into force. As per the ‘must provide’ provision, no broadcaster can deny content to any distribution platform. While most in the industry are protesting against the order, Trai chairman Pradip Baijal insists the norm is consumer-friendly and that there’s no room for exclusivity.

But says Ms Sengupta that TRAI’s ‘must provide’ clause is likely to be a transitional thing.

As for cost, DTH is considered an elite option. But the cost goes up only with exclusive and premier content along with value-added services.

DTH is all about reaching TV homes directly without any intermediary like a cablewallah.

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