DTH to drive pay-TV revenue growth in India: Frost & Sullivan

MUMBAI: Pay TV revenue in India is expected to grow at 19% primarily driven by direct to home (DTH) services despite a moderate growth in the active pay TV subscriptions, according to Frost & Sullivan’s Pay TV Services in India 2017 report.

The report further stated that digital cable will continue to grow in Tier 2 and 3 cities and rural India, despite diluting its footprint in Tier 1 cities.

“TV in India is characterized by an increase in Free-to-Air channels, HD content, digitized households, and changing viewership patterns,” said Frost & Sullivan Research Analyst Digital Media Practice Aafia Bathool. “Although India is a price-sensitive market, consumers will embrace the digitization mandate as they experience multi-dimensional benefits and quality enhancements, and become more tech-friendly and mobile.”

“The primary challenge for the growth of the India Pay TV services market is low ARPUs, especially in the cable TV segment. However, value added services such as HD and broadband will likely help Pay TV operators to increase their ARPUs over the forecast period,” adds Frost & Sullivan Senior Director, Digital Media Practice Vidya S. Nath.

The market participants are battling against several factors outside their control, especially growth in online video viewership and the entry of large telecom and technology companies into the media sector such as Reliance, Netflix, Amazon etc.

Consolidation will continue in this market as companies will try to take advantage of the economies of scale. More the number of companies merging within the landscape, the better their chances to streamline their operations, target a wider viewer base, achieve profitability, and look for strategic growth.

“Digitization in DAS III and IV remain the most challenging areas as many local cable operators (LCO) still transmit analog signals and hesitate to switch to digital services,” observed Bathool. “While consumers are grappling with diverse subscription packages, complex user interface and value-add services, Pay TV operators are confused about the type of value-added services they can offer to help grow their revenues.”

To gain competitive advantage, Pay TV operators should capitalize on a vast dislodged consumer base by offering concessional packages and installment-based payment mechanisms to ensure they subscribe to legitimate services.

The analysis sheds light on the Pay TV services market in India with an overview of the digital cable TV market, DTH market, IPTV attempts, cable broadband, regulatory policies, technology trends, competitive landscape and growth opportunities. The leading market participants are Dish TV, Tata Sky, Siti Networks, Digicable, Airtel TV, Asianet, GTPL, Hathway, Sun TV Networks, among others.

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