Technology

Digitalisation to drive value shift in India pay-TV ecosystem

MUMBAI: A new report by Media Partners Asia (MPA) indicates that digital pay-TV penetration of TV homes in India will grow from less than 20 per cent in 2011 to 50 per cent by 2016, and 61 per cent by 2020.


The key demand drivers will come from cable operators, six commercial DTH pay-TV platforms, and DD Direct, the government-owned free DTH platform. A gradual consolidation of last-mile local cable operators will become inevitable, leading to a shift in industry profits and value to centralised distribution platforms and broadcasters.


The report ‘Asia Pacific Pay-TV and Broadband Markets 2012‘, measures consumption and revenue generation across pay-TV and broadband industries in 16 Asian markets, including India, which the remains the key pay-TV market for Asia in the future.


MPA executive director Vivek Couto said, "India’s digitalisation timetable implies a three-year transition to full digital TV (DTV) conversion. This is ambitious though we believe DTV transition will occur but over a longer time frame. The industry will remain capital-intensive until 2017 at the earliest, due to the capex requirements associated with digitalisation. This will lead to more M&A and fund-raising activity in both primary and secondary markets."


The sector’s improved transparency, scale and operating leverage will attract large domestic and international strategic players, who will play a key role in M&A activity.


MPA’s biggest concerns include cable execution and capitalisation as MSOs transition from a B2B to B2C model; DTH satellite capacity; and the extent of regulation in the broadcast ecosystem. While digitalisation is the result of policy progress, this has not been the case for investment and taxation policies.


MPA projections indicate that pay-TV industry subscription fees will grow at an 11 per cent CAGR between 2011-16, driven by increased volume over DTH and digital cable. Total pay-TV subs are expected to reach 172 million by 2016, and 199 million by 2020.


MPA projections measure pay-TV penetration after accounting for households that opt for multiple services. Using this definition, MPA estimates that pay-TV penetration will grow from 79 per cent to 89 per cent between 2011 and 2020.


The majority of DTH pay-TV platforms will be generating free cash in the next three to four years, says MPA. The active DTH subscriber base (i.e. paying customers only) could grow from 29 million in 2011 to 69 million by 2016, and 93 million in 2020. This implies a 46 per cent share of the overall market by 2020 (versus 23% in 2011), and a 65 per cent share of the digital pay-TV market. DTH operators have been working together to improve the overall economics for the business; nonetheless, a rise in subscriber acquisition costs due to growing competition from digital cable, as well as medium-term satellite capacity constraints, remain concerns.


DTH industry revenues will reach almost $4 billion by 2016 and $6 billion by 2020, with revenue growth largely driven by expanding the subs base. ARPU growth will be partially limited as DTH expands nationally, with low-income homes coming into the mix, although MPA also sees a greater contribution from high-ARPU HD subs.


Digital cable subs will reach approximately 33 million by 2016 and 48 million by 2020, with cable’s consumer proposition, in the form of channel packs, HD, VAS and broadband, driving subs and Arpu growth. Monthly digital cable ARPUs will grow from $4 in 2011 to $5 by 2016 and $6 by 2020. Total cable industry subscription revenues will grow from $4.2 billion in 2011 to $6.4 billion by 2020, with broadband contributing 15 per cent to sales by 2020 versus 85 per cent for pay-TV.


For broadcasters, digitalisation and greater transparency in the pay-TV ecosystem will result in a higher proportion of subscription revenues, as well as rationalised carriage and placement fees. At the same time, broadcasters will need to programme stronger, differentiated content to survive and prosper in a new ecosystem, and create new consumer demand.


MPA expects total pay-TV channel revenues to grow from $3.4 billion in 2011 to $6.7 billion by 2016, and to $9.6 billion by 2020. Subscription revenue upside from DTH will be capped, however, due to fixed fee deals already in place between broadcasters and DTH operators. Incremental growth and upside will largely be driven through digital cable platforms.


Revenues will continue to remain skewed in favor of advertising, with the latter contributing 70 per cent to total broadcaster revenues in the long term.

Latest Reads

http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2017/12/06/Navanit-Samaiyar_0.jpg?itok=fQLjKjss
HAL Robotics ropes in Navanit Samaiyar as board member and advisor

MUMBAI: HAL Robotics has roped in Navanit Samaiyar as its board member and advisor. Samaiyar has a record of setting up, scaling and transforming businesses across a very wide cross section of industries spanning from IT/ ITeS to steel, telecom, engineering goods, earthmoving machinery, logistics...

Technology Hardware Components
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2017/11/07/Arnab-Goswami.jpg?itok=VUCIzU8A
Republic TV launches Android app

MUMBAI: Republic TV is on a roll. From rocking the ratings chart in launch week itself to going international, the channel has added one more accomplishment to its kitty. The Republic TV Android app is now live.

Technology Software Applications
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2017/10/11/STB.jpg?itok=WsiaUBr8
STB cos in India, China enhancing features, providing customised solutions, Technavio enlists top vendors

MUMBAI: The global STB market is characterised by intense competition as the market is saturated in developed countries. The market share of these players is declining because of the entry of new players. The STB companies are enhancing the features of STBs and providing customised solutions to...

Technology Hardware Set-top Boxes
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2017/10/09/PFT.jpg?itok=VJugic3c
India's PFT Clear Media ERP suite to help US' PBS content delivery

MUMBAI: Prime Focus Technologies (PFT), the technology arm of Prime Focus, announced that its CLEAR™ Media ERP Suite has been selected by Public Broadcasting Service (PBS) to enhance their Network Operations Center (NOC) ecosystem efficiencies and sustainability, with the objective of reducing...

Technology Software Applications
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2017/10/09/JosephSiino.jpg?itok=doyka7Tg
Broadcasters, OTTs to gain as Via adds xHE-AAC at special rate

MUMBAI: Via Licensing Corporation, a intellectual property solutions provider, has announced the upcoming availability of Extended High Efficiency AAC (xHE-AAC) as part of the Advanced Audio Coding (AAC) patent pool. The expanded patent pool licence will be available at no additional cost to...

Technology Software Applications
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2017/10/06/Brian_Morris-Colin_Smith.jpg?itok=xVBB0KbV
Tata Comm to deliver Motorsport videos on global devices

MUMBAI: Tata Communications will now deliver video content for Motorsport.tv viewers' all devices over its global network. The two have partnered to power the growth of the network’s internet television platforms.

Technology Software Applications
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2017/10/06/ChyronHego_0.jpg?itok=qWRkJ4jh
How to create live video content sans pros, convert radio broadcast into visual show

MUMBAI: ChyronHego will be showcasing its live production, automation solutions at Broadcast India show in Mumbai in mid-October.

Technology Software Applications
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2017/10/03/Arvin%20patel%20tivo.jpg?itok=Ieo7eXfw
Sony renews IP licence deal with TiVo

MUMBAI: TiVo Corporation, a leader in entertainment technology and audience insights, has announced that Sony Corporation, a leader in consumer electronics, has renewed its multi-year intellectual property (IP) licence agreement. The license to TiVo’s patent portfolios covers all of Sony’s...

Technology Software Applications
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2017/09/30/cable-wire.jpg?itok=vJM4lI00
Digital TV, growing telecom major drivers of coaxial cable growth in A-Pac: Study

MUMBAI: The global coaxial cables market is mature owing to the use of coaxial cables in industries for a long time and the slow or stagnant product innovation.

Technology Hardware Components

Latest News

Load More

Sign up for our Newsletter

subscribe for latest stories