Monday July 20, 2009 – Antonette Goroch
India, only just beginning its transition from analog to digital, is now one of the fastest growing regions for pay TV. The Indian market, with more than 100 million TV households, is almost as large as the U.S. market, making it a handsome target for vendors and operators seeking high-growth territory. Even though digital cable, IPTV and DTH satellite operators have sought an early foothold, only satellite has gained real traction.
Indeed, DTH satellite providers have blanketed the country with inexpensive digital TV packages so fast and so well, one wonders whether other platforms have any hope for widescale success at this point.
DTC’s most recent look at the market showed DTH in India now reaching 12.3 million subscribers, up from only 7 million in 2007 and 3 million in 2006. Competition among operators is hot. Three new systems launched in 2008 (Reliance, Bharti Airtel and Sun Direct), joining the three market incumbents (DD Direct, Tata Sky and DishTV). Another system, Videocon, is due for launch in 2009, bringing the total number of systems available to seven by year’s end.
The crowded field has led to fierce competition and heavy discounting of STBs, (two operators, Sun Direct & Reliance, offer free STBs for new subscribers), which has helped stimulate demand in India’s large market. DTC expects that DTH will see significant growth over the next several years, with subscribers forecast to surpass 27 million by 2010, close to the size of the U.S. market.
Similar efforts are expected from both new IPTV systems and incumbent cable subscribers, but these operators will have to shell out a lot of capital to put in infrastructure in areas already covered by satellite. It could be a tough sell unless they can successfully differentiate themselves from satellite services. IPTV and digital cable’s two-way infrastructure will enable interactive services – a possible competitive advantage over satellite. Advanced services aren’t a guarantee of success. Any new operators will have to struggle to find profit in such a highly competitive, price-cutting environment.
Don’t expect either digital cable or IPTV to disappear in the region, however. Future partnerships between DTH and other wired providers, using hybrid boxes to extend the range of services already available through DTH, will likely be the next phase in India’s transition from analog to digital TV.
