(8 April 2009 10:30 pm)

MUMBAI: Kalanithi Maran-promoted Sun Direct is targeting a revenue of Rs 10 billion for FY'10 even as it plans to double its subscriber base to six million.

As first reported in Indiantelevision.com, the DTH service provider's net loss is Rs 4.5 billion. Sun Direct has invested close to Rs 20 billion in the venture, with Malaysia-based Astro pumping in Rs 5.90 billion for a 20 per cent stake in the company.

"Our net loss of Rs 4.5 billion on an active subscriber base of 3.1 million will, perhaps, be the lowest among the DTH operators in India. We are only subsidising the set-top boxes (STBs). Other DTH service providers are subsidising the content as well as the STBs," said Sun Direct COO Tony D'Silva, while announcing the launch of HD (high definition) services.

Posting a revenue of Rs 3.5 billion for Fy'09, Sun Direct expects to operationally break even after five years and be profitable after six and a half years. The marketing spend for FY'10 will be Rs 1.50 billion, said D'Silva.

The company has launched two HD channels, becoming the first to do so on the DTH platform in India. The plan is to take it to four and to increase it to eight in the next eight months, depending on transponder availability. "We have launched Tamil and Telugu movie channels on HD. We have signed an agreement with National Geographic Channel for HD and are in discussion with others. We plan to have a bouquet of eight HD channels and have asked Isro for two more transponders," said D'Silva. Sun Direct currently has seven Ku-band transponders on Insat-4B.

Consumers will have to pay Rs 10,000 for the HD STB and a monthly fee of Rs 100 per channel on top of the the basic pack that they subscribe to.

"We expect to get 60,000-70,000 HD subscribers in the first year. We estimate around 1.5 million LCD TVs will be sold in FY'10, out of which around 20 per cent would be full HD. The government has also announced that the Commonwealth games, to be held in Delhi in October 2010, will be telecast in HD. This should give the market a boost," said D'Silva.

With the launch of its HD services, Sun Direct expects to up its ARPUs (average revenue per user) from Rs 90, the lowest in the industry.

Sun Direct claims to have the lowest churn rate at 0.3 per cent, despite having the lowest pricing of its service. "We give customers the right kind of service at the right price. We can afford to do it because we have done a la carte deals with the broadcasters and we have bought content from them at the best rate," explained D'Silva.

Unlike Dish TV and Tata Sky, Sun Direct does not charge any carriage fee from the broadcasters. It has seven basic packs which cater to the needs of the various regional markets.

Starting operations in September 2007, Sun Direct completed the roll out of its service in the four south states by December and touched one million subscribers in 200 days. It launched pan India operations in December 2008 and touched three million subscribers in the first year of being a national player. "About 15 per cent of our subscribers are from outside the southern region. We continue to provide 41 number of add on packages from Rs 6 to Rs 300," said D'Silva.

Also Read:
Indiantelevision.com's interview with Sun Direct COO Tony D'silva