DTH CASE STUDY
Keith Soares
Sachin Modi – RM10008
Introduction
DTH stands for Direct-To-Home television. DTH is defined as the reception
of satellite programmes with a personal dish in an individual home.
DTH does away with the need for the local cable operator and puts the
broadcaster directly in touch with the consumer.
DTH History in India
DTH services were first proposed in India in 1996. But they did not pass
approval because there were concerns over national security and a cultural
invasion. In 1997, the government even imposed a ban when the Rupert
Murdoch-owned Indian Sky Broadcasting (ISkyB) was about to launch its
DTH services in India.
Finally in 2000, DTH was allowed. The new policy requires all operators to
set up earth stations in India within 12 months of getting a license. DTH
licenses in India will cost $2.14 million and will be valid for 10 years. The
companies offering DTH service will have to have an Indian chief and
foreign equity has been capped at 49 per cent. There is no limit on the
number of companies that can apply for the DTH license.
Player’s in DTH – Market Share
DISH T.V Market Share of the Key Players
Air Tel
DTH
Big TV 8%
TATA SKY
Dish TV
12% 31%
Sun DTH
23% Tata Sky
26%
BIG T.V
AIRTEL DIGITAL
SUN DIRECT
DTH Technology
DTH network consists of :
Broadcasting center
Satellites Encodes
Multiplexers
Modulators
DTH receivers.
Products Diffrentiation
2nd 3rd Latest Entrant
Particulars
Technology MPEG-2 MPEG-2 MPEG-4 MPEG-4
Radio yes no no no
Exclusive Channels 32 6 6 6
Both DishTV and Tata Sky have MPEG 2 format whereas Airtel and BigTV
are MPEG 4 ready.Hence to maintain there market leadership bothDish TV
and Tata Sky will need to adopt the following strategies: -
Need for good differentiators that sets them apart from competition
Will need to setup more transponders as MPEG 2 compression technology is
not as good as MPEG4 there less channels
Will need to focus on better Branding of its (MPEG2) technology used as
MPEG4 is being used by its competitors to equate it to superior Picture quality
Will need to upgrade technology to manage environmental disturbances
better
Why DTH ? – Broadcasters View
Today, broadcasters believe that the market is ripe for DTH. The prices of
the dish and the set-top box have come down significantly. Overall
investments required in putting up a DTH infrastructure has dropped and
customers are also reaping the benefits of more attractive tariffs.
The major thing that DTH operators are betting on is that the service is
coming at a time when the government is pushing for CAS (conditional
access system), which will make cable television more expensive,
narrowing the tariff gap between DTH and cable.
Current Market Scenario
DISH TV
Dish TV who was awarded India’s first DTH license in 2003 and began
operations in 2004. With Dish TV you can access content from Shaadi.com and
search for potential partners through the Shaadi Active service. The content is
not live but is updated every week. Similarly you can access content from
monster.com and ICICI Bank.
Though a market leader in DTH and having first mover advantage these
Service provider has incurred huge losses(approx. Rs661 Cr. till 2009) for the
folowing reasons: -
Educating customers on the unique advantages of DTH over Cable
High Acquisition and Marketing Cost
Competing with Cable on the Price front
Competing with Cable on the number of Channels it could offer at the
same price
TATA SKY
TataSky is the most popular DTH Service. Launched on 15th August 2006,
TataSky provides 24×7 customer support in 11 Indian languages. Packages are
expensive than others. TataSky provide the maximum number of interactive
services.
Tata Sky has done exceptionally well because of it’s marketing initiative
like: -
Excellent branding and positioning on the Pause and Record facility
offered
which gives everyone in the household the impression that all can watch
their favorite programs without compromising on other important things
Focus has been on the quality of family time which is striking a
connectwith
everyone
Interactive Content is also a key differentiator 10 + Interactive services
currently in the offering , more than any other operator
SUN DIRECT
Sun Direct has a strong presence in South India, with their south centric plans. Sun
Direct packages are regions and languages specific, allowing you to select channels
of your preferred lanugages.
Though following Tata Sky very closely in terms of market share, Sun Direct needs
to follow the below approach: -
Continue launching Pan India
Continue with its aggressive low pricing
Develop interactive content
Pay for what you watch , give the customer a choice with respect to what
he/she would like to have as opposed to forcing the customer as now is the case
Come out with new ideas such as Video Conferencing ( STB could have an
inbuilt Microphone and Camera )
Allow one STB for at least 2 TV’s as this is where Cable scores over DTH and
make this a differentiator
Continue with its branding as Value for money
AIRTEL DIGITEL & BIG TV
Airtel Digital also provides a lot of innovative interactive services. Airtel provides some
exclusive features such as a Univeral remote. The iNet feature provides customer with latest
news, stocks from your portfolio, Bollywood gossip and the latest weather with widgets. Airtel
Digital has partnered with NDTV for News widget and CNBC for stocks.
BIG TV boasts of better picture quality using the MPEG4 technology. BIG provides better pay-
perview movies options at competitive pricing.
Benefits in comparision with existing players: -
Pricing became competitive
Technology as a factor (MPEG 4)
Distribution Capability as a factor
More awareness for DTH
Choice of Content / Packaging
Existing customers being a target group for Telecom Players
Advantages: -
Latest technology at the time of entry
Sufficient awareness on DTH already exists
Huge base of existing Telecom and other sector customers to targeted
Existing distribution Network
Challenges : -
Late entrants and therefore higher Acquisitions costs
Need of good differentiators to succeed.
VIDEOCON - D2H
Videocon made it’s entry in these highly competitive market in September
2009, the following reasos will help the company to establish itself in the
market at a faster pace: -
Last entrant therefore can learn from competitor mistakes
Can employ tactics that have worked for its competitors
Can boast of the latest Technology and can brand accordingly
Easy packaging of Videocon d2h along with any of its electronic products
such as TV’s
Branding Strategies
1. DishTV : With Sharukh Khan urging customers not to be satisfied
(Santusht) with the existing services punch line they have been using is
“Thoda Aur Wish Karo”
2. TataSky : has Aamir Khan as their brand ambassador, Interactive Services
as its key proposition along with the recording facility on Tata Sky + which
allows the customer to pause live feed and watch later at convenience
3. Sun Direct : Low Pricing & Pay for what you watch
4. BigTV :Has roped in Abhishek Bachhan as their brand ambassador and
proclaims about Better Picture Quality with MPEG4 Technology
5. Airtel : Branding same as that used for their Telecom Arm and with focus
on Better Picture Quality
Future Prospects of DTH
The cable system is well entrenched in India and is showing quite rapid growth. If DTH
had come to India in 1996-97 (like Star had originally attempted), then it could have made
a significant breakthrough.
Europe is an example of this. DTH developed there before cable and now controls nearly
80 per cent of the total satellite television subscriber base.
DTH will definitely cut into the existing cable user base. It will make the local cable
operator less important and take business away from him. It will give consumers greater
choice.
But it is likely to be an up market premium product and most middle class households will
stick to cable.
The DTH market in INDIA is relatively increaseing day -by-day.
In coming 5 years.... We have managed to overtake Japan as the largest DTH market in
Asia.
In the next 5 years (by 2014) we will be able to add another 30 million subscribers .
Road Ahead
Better Technology to cope with environmental disturbances
Price of Offerings has to compete with Cable
Innovative ideas for Interactive Content
Pay for what you watch only
Freedom for customers to use more than one TV on a single STB just like
cable without paying extra
Continue with better quality picture with More channels for Less
Thank You
