Technology

Demand for TV transponders to triple in five years: PwC

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NEW DELHI: The number of satellite transponders required by Indian TV broadcasters and DTH operators is expected to double or triple over the next five years.

A new report from the Cable and Satellite Broadcasters Association of Asia (Casbaa) entitled “Easing India’s Capacity Crunch” forecasts that transponders required by the DTH industry will rise from 73 in 2012 to more than 220 in 2017 to meet burgeoning demands by Indian consumers.

The report prepared by PwC was released at the Casbaa India Forum 2013.

This rapid growth in transponder demand will be driven by the expected increase of TV channels in India, fuelled by strong growth of the Indian television industry over the next few years (expected CAGR of 14%).

The continued proliferation of pay-TV services, coupled with cable digitisation, growth of regional channels and entry of foreign players will provide a fillip to growth. Given these driving factors, India can potentially have about 1,600 licensed channels by 2017, of which about 1,300 channels (80% of licensed channels), are expected to be operational.

High growth in the number of HD channels is expected, due to growth in digital platforms coupled with increasing penetration of high-end TV sets that support HD viewing experiences. By 2017, India is likely to have approx 130 HD channels. This growth in the number of channels will lead to higher demand for C-band and Ku-band transponders.

In the report, Casbaa and PwC make a series of suggestions for improving the management of India’s satellite industry, to make it more efficient and market-friendly.

The report notes that Indian Space Research Organisation (Isro) is working hard to launch new satellites and procure additional spectrum to meet the burgeoning demand. Nevertheless, says the report, “it is unlikely that any single satellite operator will be able to fulfil even current demand, let alone the future demand for satellite capacity.” Foreign satellite operators will need to be encouraged to invest in capacity to serve the Indian market.

“In spite of the urgent requirements for satellite capacity, there are challenges placing practical restrictions on leasing transponder capacity from foreign satellite operators by Indian players,” said John Medeiros, Casbaa’s Chief Policy Officer. “Key hurdles include procedural requirements and delays and short contract durations inducing uncertainty for both Indian players and outside investors.”

Smita Jha, leader of PwC India’s Entertainment and Media practice, said: “Satellite capacity constraints impede the growth momentum of the Indian TV sector and impact the ecosystem of the industry. The capacity crunch could restrict the launch of local regional channels and special interest channels and could lead to a distortion of competitive balances in multiple ways.”

The report encourages the Indian government to formulate policies and processes to spur growth in satellite services, and to explore opening up additional frequency bands for use by TV industry players. It suggests measures such as allowing DTH operators more freedom to easily lease more space on authorised satellites they already use, lengthening the allowable term of satellite transponder contracts, improving publicly-available market information from the government and ensuring adequate spectrum is available for satellite use in India.

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