The penetration of paid Cable & Satellite (C&S) television
households in India is expected to grow to 173 million by
2017 representing 91 per cent of TV households.
Ficci KPMG report on the Indian television industry pegs the
number of paid C&S households to be in the region of 121
million, which is 79 per cent of the total TV households in
2012. The report excludes DDs free Direct-to-Home platform
number of TV households in the same period is expected to
increase from 154 million to 191 million aided by strong growth
in sale of television sets. The number of C&S households
in India increased by 11 million in 2012 to reach 130 million.
14 million television sets were sold in India in 2012, the
report said adding that a large proportion of these television
sales represent replacement of old television sets, institutional
TV sales, and a second or third TV set entering a household.
television industry in India is expected to grow at a CAGR
of 18 per cent over 2012-17, to reach Rs 848 billion in 2017
from an estimated Rs 370 billion in 2012 aided by digitisation
and the consequent increase in Average Revenue Per User (ARPUs).
share of subscription revenue to the total industry revenue
is expected to increase to 72 per cent (Rs 607 billion) in
2017 from 66 per cent (Rs 245 billion) in 2012. The television
ad revenue to the total industry revenue during the same period
will decrease to Rs 240 billion (28 per cent) in 2017 from
Rs 125 billion (34 per cent) in 2012.
of cable, which is expected to usher in an era of transparency,
will reduce carriage fees, building a case for the launch
of niche channels and investment in content for existing channels.
and refinements in viewership measurement systems may affect
the way advertising is distributed among channels, the report
per Ficci KPMG Indian M&E report, most stakeholders had
indicated a delay of 6-12 months for complete digitisation
across metros, and that DAS is likely to be successful in
comparison with the earlier CAS.
there have been implementation challenges in Chennai, DAS
rollout is estimated to be almost complete in Delhi and Mumbai.
Kolkata is expected to be largely digitised by the end of
digital ecosystem in India cannot remain where it is. It will
either move forward to completion, or regress, like CAS did.
If Phase 2 and 3 dont go through, even the metros will
relapse, said Ficci Media & Entertainment Committee
chairman and Star India CEO Uday Shankar.
TV industry has witnessed a trend of broadcasters coming together
to consolidate their distribution functions, to improve negotiating
power. Mediapro and One Alliance are examples. This trend
continued in 2012, with the formation of IndiaCast to distribute
Viacom18, Disney and Eenadu Group channels.
upside was not materially felt in 2012 since MSOs are still
in the process of establishing subscriber management systems,
except for sports and niche segments. The broadcaster-MSO
agreements continue to be based on fixed fee arrangements
for the most part.
COO NP Singh said, Early benefits of cable digitisation
were seen in the form of some increase in subscription revenue
and some decrease in carriage in two major metros. However,
real benefits will come in over the next 2-3 years as other
towns get digitised.
experts pointed out that digitised markets of Mumbai and Delhi
have witnessed a 15 to 20 per cent drop in carriage. In some
cases, broadcasters have continued to pay the same carriage,
but are able to carry a larger bouquet of channels at the
carriage fee may decline further over the next 2-3 years,
part of this may claw back in the form of placement fees,
where broadcasters pay for placements in various tiers of
fee shall never be an equal replacement for carriage, it will
be a localised and a relatively small revenue stream since
digital cable can easily carry 500 channels, and the channels
anyway need to be grouped by genre which reduces the value
of placement charges, feels Zeel chief strategy officer
the process of digitisation, while STBs have been seeded by
MSOs, and the consumer has started receiving digital signals,
packages have not yet been deployed. The consumer is receiving
the full portfolio of channels from their MSO. However, this
has helped MSOs retain a large share of their analogue subscriber
MSOs appear to be optimistic about deploying packages by April
2013, the larger industry believes that this process may get
done sometime in the second half of 2013. Deployment of packages,
being a way to differentiate the customer base, is a key driver
to raise Arpu.
and Digital cable to co-exist
Indian market, the report noted, is large enough to provide
significant growth opportunities for digital cable as well
as DTH service providers.
cable, which has 19 million subscribers out of a total of
130 million TV homes, will grow to 81 million subscribers
with 44 million subscribers is expected to touch 90 million
subscribers by 2017, thereby becoming the biggest platform.
ARPU for digital cable is expected to be on par with DTH by
2017. Arpu for digital cable is projected at Rs 289 per month
from Rs 166 in 2012 while Arpu for DTH is projected to grow
to Rs 293 in 2017 from Rs 170 in 2012.
slowdown and impact on the TV industry
television advertising industry continued to be under pressure
due to the soft global and domestic economic condition. This
resulted in muted growth, particularly in the first half of
an overall basis, the total TV advertisement market is estimated
to have grown around 8 per cent in 2012, lower than industry
expectations. In comparison, growth in the TV advertisement
market was estimated to be 12 per cent in 2011 and 17 per
cent in 2010.
has been the toughest year in recent times; in many ways,
it was even worse than when the subprime crisis hit in 2008.
At least then, the sentiment was still bullish coming on the
back of a few years of robust growth. This time, the mood
is a lot more downbeat. Everyone is going into capital conservation
mode. Having said that, in 2008, the perception of things
to come was much worse than reality and ad spends were perhaps
cut down a lot more than was warranted, Shankar elaborated.
total number of channels increased from 623 in 2011 to 845
in 2012, leading to an increase in advertising inventory.
Most of the volume expansion is estimated to have come from
other genres while GEC volumes remained stable. Existing GEC
broadcasters may have seen a limited increase in free commercial
top 10 sectors continued to account for approximately 60 per
cent of the overall TV advertising volume share during 2012;
similar to the past three years. The FMCG sector continued
to dominate the advertising space with 9 out of Top 10 advertisers
being FMCG players. Personal products (care and hygiene, accessories,
hair care, healthcare) accounted for 26 per cent of advertising
volumes in 2012, up from 25 per cent in 2011, and 23 per cent
buying on account of large FMCG companies maintained the pressure
on advertising rates. Hindustan Unilever with the largest
portfolio of brands continued to maintain its position as
the top advertiser on TV by a wide margin.
the trend observed in the past few years, advertisement revenue
growth was largely attributable to volume growth. Rates continued
to remain flat or even declined in some cases.