Indian DTH Market Presentation

8/9/2019 Indian DTH Market Presentation

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Indian DTH marketIndian DTH marketIndian DTH marketIndian DTH market

Presented By :

Vikram Yadav

Venkataramana GSameer Gupta

Raveesh S

Mayuresh SharmaManoj Jindal


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What is DTH?What is DTH?Direct To Home (DTH) is a distribution platform for multichannel

TV programmes on Ku band (high frequency of 11.7 to 14.55GHz)by using a satellite system which transmits signals directly to

subscriber Premises.

How DTH works ?

1. Channel Broadcaster Sends the channel content to geostationary satellite.2. DTH service provider receives the signals & send it to satellite with theirku transponders.

3. The satellite receives the signals at Ku Band & transmit back .

4. The Dish Antenna at subscribers home receives the signals


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Competition on subscriber acquisition spree




DTH Market - OverviewDTH Market - Overview

Indian cable TV subscribers are currently spending about1.5 - 2% (US$ 4 - 5) of their monthly income on cable services

Globally, consumers spend 3 - 4% of their monthly incomeon pay television services

In 5 years India have managed to overtake Japan as thelargest DTH market in Asia

And by 2012 India will be able to add another 30 millionsubscribers

While this indicates a sizeable growth opportunity, only amass service can achieve the economies of scale to fully exploitthe market potential


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Increasing penetration of TVIncreasing penetration of TV

With rise in disposable income TV households are increasing spree.


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DTH gaining share in TV HHDTH gaining share in TV HH

The DTH market in India comprises 13% of the total market with almost18 million homes. Industry estimates DTH to touch 35-40 million subscribersby 2012, and thats the number that every DTH brand has set its sights on.


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Pay TV market on Growth TrajectoryPay TV market on Growth Trajectory

India has about 136 million TV homes of which, Cable & Satellite (C&S)services are present in 105 million (77%) of the home.


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Key Drivers & ChallengesKey Drivers & Challenges


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Market PlayersMarket Players


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Dish TVDish TV Indias first DTH service provider.

Launched in the year Oct 2003.

Partnership with the Essel group & Zee TV

6.4 million subscribers all over India

Brand Ambassador- Shahrukh khan

Tag line- Dish karo wish karo

Official partner- Indian Cricket League


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TATA Sky JV b/w Tata Group & UK-based British Sky

Second Mover after Dish TV

Leveraging on brand TATA and High brand recall

Superior Picture quality /Good Customer Service

Innovative Product offering Tata Sky Plus with recordingfeature

Brand Ambassador- Aamir khan

Tag line- Isko Laga Dala to life Jhhinga lalalalalala

Interactive channels and program guides


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Sun Direct Sun GroupSun Direct Sun Group

First operator to use MPEG-4 encoding so can carry morechannels

South Indian market targeted- Offers more South Indianchannels than other operators

Receives some DD Direct Plus channels as both use samesatellite

Tag line- Ghar Ghar Mein Sun Ton Tona Ton

Dish & STB free

Monthly Expense as low as Rs.99/- per month.


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Airtel digital TV is a part of Bharti Telemedia Ltd a subsidiary of BhartiAirtel Limited largest mobile service provider in country. It has beenpositioned as premium player in DTH market.

Big TV is a part of Reliance Communication Ltd .Strong distributionnetwork let it capture significant portion of market in less time.It is first to provide service in which multiple channels(up to 12)simultaneously.

Videocon D2H is a part of Videocon Industries Ltd (Indian based electronicsgoods manufacturing company).It is latest entrant in DTH started services inMid 2009.Company launched integrated digital TVs having STB apart fromseparate standalone STB.


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Mar et tr ct reMar et tr ct reMar et

leader

Mar etchallengers

Mar et

followers


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Competition LandscapeCompetition Landscape


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Bargaining power ofsuppliersVery high

Transponders - Very HighContent - Very High

CPE - Low

Threat of SubstitutesVery High

Cable TV HighIPTV High

Terrestrial - Low

Inter firm RivalryVery High

Price WarsLitigations

Threats of New Entrants

Low

DTH market is alreadyCrowded with 7 operators

Bargaining power ofBuyersHigh

Lots of optionsPrice Sensitive Buyers

Michael Porters Competitive forces ModelMichael Porters Competitive forces Model


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Threat of new entrantsThreat of new entrantsWith already 7 players in the DTH space, threat of new entrants is relatively

low. There is already enough competition which will discourage new firms to

enter this business. While getting a license is relatively easy, Industry growth is

about 30 % still the barriers to entry are high.

Here are the list of ENTRY BARRIERS in DTH industry. High initial setup cost of satellite transponders and other hi-tech equipment.

Low margin and high volume industry

High cost of setup boxes(CPE).

Multicultural & Multilingual Geography

Long gestation and break even period

High Cost of Content


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Threat of SubstitutesThreat of Substitutes

Substitute present in market as of today are as follows.

AnalogCable Connection Huge unorganized market & easy to get.

CAS - Digital Cable TV which actually addresses all issues of analog Cableconnection

Doordarshan world largest broadcast with covering about 90 % ofIndia

IPTV - Television signals sent over telecom line. It is often presented as bouquetof video(TV), audio (telephone) & data (broadband) services.

HITS(Headened in the sky) New technology accepted by TRAI recently whereend customer is cable TV operator not direct customer.

Since price associated with switching between various substitutes is not thatmuch hence threats from Substitutes can be put High.


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Bargaining powers of SupplierBargaining powers of Supplier

DTH Industry relies on three Major Suppliers:

Customer Premise Equipment (CPE) comprising of the satellite dish, Set TopBox with the necessary Access card. With so many Asian manufactures presentthe bargaining power of Indian DTH operators with CPE supplier haveincreased.

Ku band transponders in the orbiting satellites is generally provided by Astrix,the commercial wing of ISRO either through its own satellites or by leasingtransponders from suppliers. With limited number of satellite launch in recentyear despite increasing DTH player it is very difficult to get enoughtransponders to transmit enough channels.

Content - As there is not much of regulation particularly in terms of channelpricing, acquiring content from the broadcasters is also difficult. DTH vendorsare at the mercy of the broad-casters. The bargaining power of Indian DTHoperators is very less in getting content from broadcasters.


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Bargaining power of BuyersBargaining power of Buyers

There are many factors affecting bargaining power of buyers which are as

follows:

Buyer switching Cost :The cost of service in DTH service industry is not that

much high that consumer could not afford to change. So in this industry

consumer can easily divert from one brand to another. There can be severalreasons to Change the brand like price level, quality of set top box etc. In that

case service provider cant take any strong action to make consumer brand

Loyal.

Easy availability of Substitute Products like IPTV, Cable ,digital Cable TV etc.

Purchase frequency : DTH service purchase frequency is quite high so in thatcase buyer can switch from one brand to very easily.


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Inter Firm RivalryInter Firm Rivalry

With 7 operational players, the segment rivalry is quite high.

The competition from state owned DD-Direct to private players isnegligible from the content point of view as the number of channels

offered by DD-Direct is very limited. However, DD-Direct does notcharge any monthly subscription fee which poses a threat to theprivate players.

Between Dish TV and Tata Sky there is an intense rivalry exhibitedby price wars and discount schemes offered to new connections.Being the first mover, Dish TV has price advantage in both the STBas well as procuring the transponders. On the other hand, Tata Skyclaims its STB having superior DVD quality video.

There is also a competition at acquiring the content amongst variousDTH players.


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Factors influencing consumer buying behaviorFactors influencing consumer buying behavior

Price

Customer Service

Reception

Program choices

New Technology

Technical Support


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Market SegmentationMarket SegmentationGeographic

- Urban and Rural- Regional

Demographic

- Age & Gender- Income

Behavioral- Occasions

- User status

Psychographic


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DishTv PositioningDishTv Positioning

Dish Karo, Wish Karo Thoda aur wish karo Dish karo

With this Dishtv made a very confident entry into the psyche of every Indianviewer by asserting itself as the clear DTH champion. Moreover it positioneditself as a far better and a smarter option to cable TV which apparently isenjoying a relatively a larger viewership. The brand ambassador of Dish TV,Shah Rukh Khan urges the viewers not to be complacent with the smudgy andfaulty cable service. A simple line, Santusht with your cable TV? Thoda aurwish karo, dish karo inspired millions of Indians to shed their inhibitionsand move up in life.

With emergence of other DTH operators,there was a need to re-establish theirbrand as the largest content provider. They changed their tagline to

Sabse Zyaada means: Dishtv Offers Sabse Zyaada Entertainment

Sabse Zyaada - Number of ChannelsSabse Zyaada Regional Channels

Sabse Zyaada GenreSabse Zyaada - Value at Every Price Point


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TataSky PositioningTataSky Positioning

"Isko laga daala, toh life jingalala!"The brand's positioning is based on three aspects

better picture quality,

the interactive offering and

customer service

which could be seen in the all the advertisements like Aamir Khanvirtually condemning Tata Sky for being so addictive.

Later with launch of TataSky+ ,they introduce advertisements where Khan

playing a mischievous husband to Gul Panag tells us about the benefits ofplus, Asins campaign down south tells us about the 24x7 customer service.


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Market PositioningMarket Positioning


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DishTv StrategyDishTv Strategy

Customer Acquisition strategy:1. Focused marketing leading to creation of a BRAND SRK campaign.2. Largest content offering and digital viewing experience.3. Aligned dealer incentive structure-Higher incentives for subscriber at higherpacks.

4. Competitive pricing, A-la carte offerings and ease of making payments.5. Dish TV's attractive pricing strategy

Customer retention strategy:1. Promotions and dealer incentives offered on an ongoing basis to retain customers

through innovative packages.2. Packages to suit every palate.3. Providing Value-Added Services (VAS) foray into e-banking, ticketing, jobsearch, matrimony services, sharing infrastructure with other service providers.4. In-house call centre, operating 24*7 with capacity of up to 800 operators.


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TataSky StrategyTataSky Strategy

Customer Acquisition strategy:

1. Focused marketing campaign.

2. Launch of Tata Sky Plus.

3. Distribution and after sales service.

4. Interactive services for all family members.

5. Multi Dwelling Unit (MDU) solution.

Customer retention strategy:

1. Upgrade to Tatasky + by exchanging regular Tatasky.

2. Active services.

3. Alliance with Walt Disney Company India to bring Disney characterson its interactive platform.

4. Cartoon network in telgu for its subscribers down south.

5. Tata Sky subscribers can suspend their viewing services temporarily onaccount of vacation, travel, exams etc.


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DTH Key Success FactorsDTH Key Success Factors Innovative service

Dish TV Provide Active Service Like Job, Shaadi, Game,I

CI

CI

ActiveEtc

Tata Sky Provides DVR (Digital Video Recording) service (TATASky+) which allowed 45 hours of recording in a MPEG-4 compatibleSTB

Tata Sky came up with new services called Multi Dwelling Unit

(MDU) Model. This Model Provide One Dish Is Shared By EveryHome Is A Good Way To Attract The Group Of The Customer

Big TV provides PIP (Picture In Picture) Service. This service enablescustomers to view 12 channels at same time

Distribution Most of the DTH operators present in Indian market have well

established distribution network because of their other businesswhich help them significantly to sell DTH services in allgeographical areas


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DTH Key Success FactorsDTH Key Success Factors Technology

DTH service provider initially provided MPEG2, but with advent oftechnology some of the service providers offer MPEG4 highstandard quality picture at low cost

Airtel uses the latest MPEG4Standard With DVB S2 Technology.

Sun Direct uses advanced technology HDTV (High DefinitionTelevision)

Reliance BIG TV also provides the MPEG4 with the digital videobroadcasting (DVB) as well as The Picture In Picture (PIP) System tothe DTH Service Holder


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DTH congruence of interests for all stakeholdersDTH congruence of interests for all stakeholders

Government

Plug the tax leakage through declaration Additional source of revenue license fee payable by DTH operators

Consumers

Pay what you watch model Consistent and professional service

Superior video / audio quality Multiple channel packages to choose fromInteractivity

Access to niche content Movies on pay-per-view 800 films

produced in India every year

Ability to move anywhere across Indiaw/o buying a new STB

Extensive rural reach

Broadcasters

Transparent / auditable platform withno under-declaration

New revenue stream C

onvenience of dealing with a singleoperator rather than with multipleMSOs

Will minimize piracy


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Documents

Indian DTH Market Presentation