POST 20
The Direct-To-Home (DTH) satellite broadcast has been expanding at scorching pace in last 5 years.But it remains under severe financial stress, with mounting Debt and losses.This is mainly due low average revenue per user (ARPU),soaring content cost and heavy taxation.
The substantial investments DTH companies have made in infrastructure have added to their to costs,while the slow pace of switching over from analog to digital has kept revenue down.
THE FACTS
1)The subscriber base of DTH companies in india has risen almost nine-fold in the last five years...
from 6 Millon in 2008 to 53 Million in 2013*
2)Bu the cable and satellite industry is still dominated by local cable operators due to slow pace of digitisation( swichover from analog to digital cable signals). Most cable networks operate in the digital mode
Market share of local cable operator in 2009 was 83% and that of DTH was 17% and in 2013 it is 63% by Local Cable operators to 37% by DTH service providers.
3) The ARPU is low due to rock botom pricing by DTH companies to compete in crowded market.
5$ in india where as 80$ in USA
4)DTH companies are taxed heavily.Expenses include licence fees,service tax,entertainment tax and an import duty on set top boxes.High Content cost is paid to broadcasters is major concern.
5)Investment in infrastucture too has risen over years.As a result DTH industry is reporting huge losses and is saddled with massive debt.
Debt reported for 2012 is Rs. 5.5 Billion, where as industry faces a loss of Rs.18.4 Billion.
SOURCE:Business Standard
FICCI_KPMG India Media & Entertainment Report.
The Direct-To-Home (DTH) satellite broadcast has been expanding at scorching pace in last 5 years.But it remains under severe financial stress, with mounting Debt and losses.This is mainly due low average revenue per user (ARPU),soaring content cost and heavy taxation.
The substantial investments DTH companies have made in infrastructure have added to their to costs,while the slow pace of switching over from analog to digital has kept revenue down.
THE FACTS
1)The subscriber base of DTH companies in india has risen almost nine-fold in the last five years...
from 6 Millon in 2008 to 53 Million in 2013*
2)Bu the cable and satellite industry is still dominated by local cable operators due to slow pace of digitisation( swichover from analog to digital cable signals). Most cable networks operate in the digital mode
Market share of local cable operator in 2009 was 83% and that of DTH was 17% and in 2013 it is 63% by Local Cable operators to 37% by DTH service providers.
3) The ARPU is low due to rock botom pricing by DTH companies to compete in crowded market.
5$ in india where as 80$ in USA
4)DTH companies are taxed heavily.Expenses include licence fees,service tax,entertainment tax and an import duty on set top boxes.High Content cost is paid to broadcasters is major concern.
5)Investment in infrastucture too has risen over years.As a result DTH industry is reporting huge losses and is saddled with massive debt.
Debt reported for 2012 is Rs. 5.5 Billion, where as industry faces a loss of Rs.18.4 Billion.
SOURCE:Business Standard
FICCI_KPMG India Media & Entertainment Report.
Nice one....DTH increased its market share because of compulsory digitalization.....What I couldn't understand is why government is making digitization compulsory?
ReplyDeleteThe reason is that the cable distributors are leasing the channels and distributing it more number of customers than they actually pay the price to the channels. (Like they are paying the Channel for 1 connection and distributing it to 10 consumers illegally however with slight loss of signal).
ReplyDeleteThe main objective of the digital setup boxes is to prevent illegal duplicate connections and also added advantage of improved signal strength because there is no excessive signal division among consumers.