Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player


Guest Column
Retrofit: Direct-to-Home, on the indirect route

Guest Column
Retrofit: Direct-to-Home, on the indirect route

Author | Sandeep Bamzai | Thursday, Oct 30,2008 7:53 AM

Guest Column<br>Retrofit: Direct-to-Home, on the indirect route

The way Reliance ADAG reacted to Bharti Airtel’s announcement of launching Digital TV or DTH services was reminiscent of the good old competitive advertising battles in the aerated drinks and toothpaste categories. The cola jousts using flanking devices or the fabled sabre rattling between Pepsodent and Colgate is all part of advertising folklore. It is clearly a manifestation of the GSM (Airtel) versus CDMA (Reliance Communication) rivalry which has spilled over into a brand new theatre. Wonder what will happen once RComm commercially launches its GSM services nationwide. Or when IPTV, which both companies are planning to offer, goes on stream. Clearly eyeball to eyeball.

In this specific case, Airtel displayed a plush couch and ran teaser advertisements on television. It also placed ads – skybus – strategically in national dailies. Big TV replaced the plush couch with an even smarter red leather sofa, followed by 32 leather sofas, with the tag line ‘Watch BIG TV with 32 cinema halls’. It is evident that the GSM-CDMA wars for pole position in India’s cellular landscape have come to a spanking new theatre, this time slap-bang in your homes.

Reliance ADAG’s Big TV is by all accounts making a big splash in the underserved direct-to-home market. Company sources suggest that they are selling 10,000 connections a day, which means that over the last 60 days, they have made inroads into homes with 600,000 subscribers. Let us understand the mechanics of India’s direct-to-home market. The controversial Conditional Access System (CAS) gave DTH a leg up in the metropolitan cities. The good old cablewallah was consigned to the rubbish heap.

Posh localities in south Delhi and south Mumbai have maximum penetration of DTH. Zee TV had the first mover advantage in this space, but as in everything else that Subhash Chandra does, the wheels come off the bus due to poor management. Despite that, DishTV, Zee’s offering, has in excess of 3.5 million subscribers. The real impetus to DTH came with Star offering Tata Sky, its joint venture with the Tatas. Tata Sky, too, has over 1.5 million subscribers.

Star’s DTH designs go back to the days of Rathikant Basu. The Government did not relent on approvals and a whole slew of dollars were flushed down the toilet. The small matter of KU-Bands and security threat ably played their part. When DTH was finally cleared, Star tried again, taking cue from Robert Bruce, and this time they conformed with the law of the land and tied up with the Tatas. But the Tata Sky file stayed on a top bureaucrat’s table for an eternity. Strangely, the day he moved out of Shastri Bhawan, Tata Sky received their Letter of Intent. I guess their rival may have played a part in the delay.

DTH is a bruising product category. Not only does the service offering have to be crackerjack, after sales is an issue. After all, it is a consumer facing business. There are four players in the market place – DishTV, Tata Sky, Big TV and Kalanithi Maran’s Sun Direct. Digital TV from Airtel is the fifth offering. There is also Doordarshan’s free DTH service, but that is essentially for cable dry zones.

There have been many controversies in India’s DTH journey. Till the ‘must carry’ clause mandated by broadcast regulator TRAI came into effect, there was confusion with one operator not willing to carry the other’s bouquets. The underserved DTH market will now be galvanised into activity for two big boys – Airtel and Big TV – with the necessary back end and financial muscle entering. Remember that the Tatas, backed by Ruper Murdoch, are also in the fray and they are not going to be bit players. The amount of moolah being spent by both DishTV and Tata Sky, and now Big TV, tells you that everyone senses a big opportunity. DishTV used SRK as a killer application and rival Tata Sky had to bring in heavy artillery in the form of Aamir Khan. Airtel is already using its brand ambassadors R Madhavan, Vidya Balan, AR Rahman, Kareena Kapoor and Saif Ali Khan. Big TV has gone for the thematic plank and their ads are quite interesting as they play on the word ‘big’.

Analysts estimate that 25 million DTH connections will be soaked up extremely fast now that two more aggressive players have entered. It is after this plateau that it will get difficult for the players. Pricing and after sales service are the key in the Indian context in any consumer facing business. In an underserved market, it will work on a first-come-first-serve basis and of service offering. The climb gets difficult after that.

There has been enough confusion in India’s direct-to-home policy intent. Now, with new players entering and the competitive set increasing in number, it is the consumer who stands to benefit. What happened in telecom will hopefully repeat itself in DTH. Bargain basement prices, quality service offerings, great advertising and of course, consumer benefit.

So, let the better man win.

(Sandeep Bamzai is a well-known journalist who started his career with The Statesman in Kolkata in 1984. He has held senior editorial positions in some of the biggest media houses in three different cities - Kolkata, Mumbai and New Delhi - with The Indian Express, Illustrated Weekly, Sunday Observer, Dalal Street Journal, Plus Channel where he ran India's first morning business show on Doordarshan, The Times of India Group, Business India, Hindustan Times and Reliance Big Entertainment. Starting his career as a cricket writer, he graduated to becoming a man for all seasons under Pritish Nandy, who he considers as the premier influence on his career. Since he studied economics at Calcutta University, Bamzai decided in 1993 to branch out into business and financial journalism. Familiar with all three media, he is the author of three different books on cricket and Kashmir.)

Tags: e4m

Write A Comment