DTH Current and future market scenario

Marketing Case Study By Soumya Prasanna Mishra

A wireless digital audio / video service is delivered through satellite.DTH stands for Direct-To-Home television. .

‡ 2003/2004. Delhi. 1st DTH licence was provided to Dish TV(ZEE group).History ‡ 1992. CAS got started in Chennai.Cable TV started. Mumbai and Kolkata. Simultaneously Prasar Bharti also started DTH named DD Direct+. .Due to monopoly of cable TV operators and less discipline amendment of the Cable TV networks(Regulation)Act to provide Conditional Access System (CAS) was formed to address the mile distribution and broadcast with accuracy and digitalization . ‡ 2004 DTH was started . Distribution was done by Local Cable Operators.

Multicultural & Multilingual Geography: Local language channels and penetration Long gestation and break even period: High Cost of content: ‡ ‡ ‡ ‡ ‡ ‡ ‡ .2500.DTH Market Overview ‡ ‡ The DTH industry is a high tech industry and it require lot of capital investment. Set Top Box cost (Rs.e.00) and other high tech equipment : DTH is a low margin and high volume industry: competitive pricing versus cable industry: Differentiation through content i. High initial setup cost of satellite. channels : Customer Service: Good quality service required by customers i.e better than Local Cable operators. transponder.

set top boxes with superior quality of videos etc have been witnessed in the market to catch up the space. ‡ . Price wars.Current Scenario Total TV Population Distribution in million Total TV Homes Cable & Satellite Connection DTH Connection No cable or DTH ‡ ‡ ‡ 120 80 14 26 50% 33% 6% 11% Target -homes to convert from Cable & Satellite connection to DTH. 5 active players in the market and 2 new are trying to get in.100 billion in 2011. procurement of transponders. discount schemes. The DTH Industry revenue is expected to grow at 80% compounded per annum over the next 5 years and will be in the range of Rs. bouquet of channels.

Current Players and Market Share DTH Industry Market Share 2008* Brand Dish TV TataSky Big TV Promoter Zee group Tata Sons & Star TV Anil Dhirubhai Abani Group Sun by SUN TV and Airtel by Bharti Subscriber base Million 5 3 1 Market Share 53% 30% 15% Others (Sun Direct. AirTel Digital 3 2% .

12 Satellite transponders Sun Airtel 2007 2008 1. 35000 35000 2 lakh 1Lakh . 4290( incl of Rs. of dish and monthly package monthly package packagemonthly package Rs. active services Matrimonial etc Pricing Outlets 16 on demand movies. 3 transponders.6million nd 2 MPEG-2. News.00 for installation. 1st to introduce a-lacarte package Rs.100. Dish and Installation) . Installation) . Minimum package for package 3months. 3000( incl of Rs.100. 2500( incl of STB .spl STB)+Rs.1999.cheapest subscription incl Installation) . Dish and STB . Sports.of months STB .Contd.00 200-300.4million 4th MPEG-4 . 7transponders Tata Sky 2006 2.1000.00 200-300.00 for Rs. Dish TV Subscribers Market positions Technology 2004 3. rent MPEG-4 DVB for transponders S2 Channels Value added 180 250 40 140 Movie on Interactive demand. services.2million MPEG-4.01 200-300. niche foreign channels for high end customers.00 (10 Rs. Premium STB power pause /record online 140 Big TV 2008 1. Dish and installation(incl .6million 3rd MPEG-2 . STB).00 200-300.00. Astro. ACTIVE Multilingual other SCHOOL. KIDS.

Reach customers. focus brand Value added services like interactive programs ACTIVE 66000 SUNTV Cable TV customer base.more channels . Investment in technology. reach no cable area. more channels . encourage to subscribe other packages &VAS. New Interactive services. language packages. support through AIRTEL Outlets Future Strategy 14 transponders. High definition content.Contd. 2600 crores own satellite. strong brand in South India Large mobile custoner base throutgh out India Strategy Low entry price. High defination content. more interactive services . Dish TV Tata Sky Big TV Mon Airtel Strengths 1st service Interactive Large mobile provider to have services and new phone and got large STB customer base customer base through out India and known brand name low entry price .400 investement for channels technology. support through ADAG Outlets Reach customers. ADAG clients. Low entry price . eploit existing Aairtel mobile clients. minm price minm exploit existing package. mor interactive serivices Entry into other regions of the country.

exclusive channels. retention and service are the criteria's of DTH industry. cost of accusation of a customer is Rs. ‡ Customer acquisition. . ‡ Apart from giving low price . More volume/ roping more subscribers at a lesser time is the Mantra for survival.2500). ‡ The target break even period minimum 5years and customer base >5million.Summary ‡ All players are trying to offer less price initial and monthly subscription charges for get a new customer. language channels. digital quality etc.4000 (incl STB-Rs. amongst themselves players are building edge over others by means of offering Interactive services. ‡ All are making loss because of offer price.

. The DTH industry is currently pegged at 2. it will give a boost to the demand for better quality products like DTH. ‡ The DTH Industry revenue is expected to grow at 80% compounded per annum over the next 5 years and will be in the range of Rs.6 million subscribers. ‡ with increase penetration of TVs.100 billion in 2011.Future ‡ Television households are estimated to grow to 165 million in 2011. DTH subscribers are expected to touch 27 million in 2011 and 61 million in 2015.

out of 7 players 3or 4 may remain in the long run. ‡ Customer is sensitive to price companies have to differentiate in terms of service and price. . ‡ We will see consolidation of players.DTH market is difficult game.Conclusion ‡ Increasing content costs and less transponders.

Both DishTV and Tata Sky have MPEG 2 format whereas Airtel and BigTV are MPEG 4 ready. Existing brand names Challenges Initial Price and monthly subscription charges( customer wants less charges with more channels and interactive services). . The challenges Dish TV faced were consumer awareness of the technology. shifting from conventional cable TV to a new world of viewing with 1st time investment in hardware.better customer care will be available in the market.What are the challenges before Dish TV when it pioneered the market? Answer: DTH was introduced for the 1st time in the market. 3.How has Tata Sky performed? Answer: Tata Sky performed very well. interactive services. With the entry of Airtel Digital and Big TV how do you think the market dynamics would change? What are the factors that would help these two new entrants and what are the challenges? Answer: Better price offers and more choice of channels.Questions and Answers ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ 1. They could manage to grab customers by their interactive programs (others do not have). Existing customer base and outlets 2. Factors that will help these two new entrants 1. reach to customers ( geographically). 2.

Sun direct needs to add more of other language channels like. ‡ 6. Gujrati etc. Both the old players will have upgrade to the new technology to compete with new players.e 6th player in the market. Marathi.How is Videocon d2h placed in the market? ‡ Answer: Placed as a new entrant i. They will have a tough time to get customers roped in because of competition from existing players and there subscribers. They need to invest in technology. .‡ 4.What should Sun Direct do for expansion? ‡ Answer. Their only plus point is their distribution network throughout the country. Hindi.What are the challenges before DTH TV and TataSky. ‡ Answer: New technology MPEG4 gives beter picture quality and sound effects. ‡ 5.

‡ 2. ‡ ‡ 8. ‡ Big TV.same as their cellular services. Brand Ambassador Amir Khan ‡ Tata Sky.More channels.. better quality.‡ 7.More Interactive services and pause and record facility. What are the key issues that you think are important in this Industry for future success? ‡ Answer: 1. Brand Ambassador Shahrukh Khan. What is the branding strategy of each of the players? ‡ Answer: Dish TV.due to long gestation period break-even will be a problem for all players. ‡ Airtel Digital.They want the customers not be happy with existing cable TV but go for new satisfaction with DTH. customer retention and customer service . Brand Ambassador Amir Khan. Brand Ambassador Abhisekh Bhachan.

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