Dish TV to negotiate content deals based on consumer insights gathered from RIO offering

MUMBAI: Direct to home (DTH) operator Dish TV has said that it will negotiate content deals with broadcasters based on the data it has collected of more than 0.5 million subscribers who have subscribed channels on a la carte basis.

Barring sports and regional channels, Dish TV has started providing channels on a la carte based on Telecom Regulatory Authority of India’s (TRAI) new tariff order even as the matter is stuck in Madras High Court.

Dish TV CMD Jawahar Goel has said almost 0.6 million subscribers have opted for various channels after the new a la carte offering was rolled out. The DTH operator has got rich insights as to which channels and offerings are popular with consumers.

It will use this insight to negotiate deals with broadcasters. Till now, the only yardstick of a channel’s popularity was BARC ratings. A la carte offering gives freedom to the subscribers to only pick channels that they want.

Goel noted that sports programming is not being offered under the initiative as it is an expensive proposition on reference interconnect offer (RIO) rate and also, Southern channel which are also expensive.

“All other properties are available to the consumers. This scenario also gives us an insight that which channel is popular and in demand in our kind of customers. Otherwise, our only yardstick was measurement of ratings,” Goel told analysts.

“So now we have a database of almost more than 0.5 million subscribers and their choice and liking. So this is one thing which we have not publicly shared but we are using this data to talk to the content provider in negotiating our content cost.”

The content cost of Dish TV is roughly around 31% of total revenue. Dish TV has maintained its guidance of adding 1 million subscribers on a net basis for the full fiscal.

Talking about the hybrid set top box (STB) that the company is planning to roll-out, Goel said that the Hybrid STB with software deployment will give an insight into the consumer behavior about their choice of content.

“So for us to plan the content and also the packaging, it will give us the insight of the customer. So some intelligence we will get from customer behavior when there is a two way communication in the setup box,” he noted.

He further stated that the DTH company has already deployed 0.8 million STBs with multiple conditional access built in. The operator plans to launch the STB in April. “The access fee, we have not taken decision yet how much we will charge to the consumer for giving this facility, so the technical work is going on,” he stated.

On the migration of MPEG2 customers to MPEG4, Goel said that less than 3 million subscribers were on MPEG-2 and the company is upgrading the remaining MPEG2 customer to MPEG4 through special offers.

“And from the platform also, we are reducing the MPEG-2 streaming of the channel continuously. So this process will continue, and I think, in a year’s time we will have all the MPEG-4 subscribers,” he said.

Goel also pointed out that the TRAI’s STB interoperability initiative is not viable as it has not been successful even in developed markets like South Korea and United States.

“We will still work with the TRAI and DoS to develop such a box but that may take a year or two years before pilot project is there,” he stated.

Dish TV CFO Rajeev Dalmia said that the ARPU will improve thanks to initiatives like HD for all. He noted that the ARPU in Q2 would have been slightly more but for the advanced receipt before the GST regime, which was around Rs. 200 crore.

“So the full benefit of GST will not accrue in this quarter but maybe in the next quarter or the current quarter. And that itself will give around Rs. 2 to the ARPU and as the HD progresses in Tier-I and Tier-II cities as per our plan, we see traction in the ARPU going forward,” he noted.

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