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Dth Services

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Project Report on DTH Services in India
Hyderabad Business School

Team Members
Name : Janardhan Samba Murthy
Roll No: 2225112112
Email ID : janardhansambamurthyrock@gmail.com
Name : R.Kavya
Roll No: 2225112130
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Introduction:
In earlier days there was only one TV channel in India. That is “Doordarshan” which was owned and operated by government of India. At the time of 90’s every home which had a TV set used to have its own antenna to capture the signals. The Cable Television Ordinance Law was passed in January 1995. This enabled cable operators to feed channels and later on private companies were allowed to air their own channels and this led to the explosive growth in number of TV channels and number of cable operators.

The growth of TV channels & cable operators created a big industry and market opportunities. There were as many as 1, 00,000 cable operators across India until few years back. However the services provided by cable operators were poor. The strikes, increase in tariff plan, selective broadcast and poor services were major cause of dissatisfaction among the customers. This has created an opportunity for DTH.

What is DTH?
DTH stands for Direct-To-Home, it’s a system that allows you to have a personal dish antenna how cable operators do, except it’s much smaller in size, this antenna can be fixed on your terrace and receives transmissions directly from a satellite, hence it is called as a direct to home service. Direct to home is different in the way of size of the antenna require is much smaller, the city will have less wires from one building to another and you have the flexibility of moving out without searching for new cable operators. You do not have to deal with the local cable operators.

DTH services were first proposed in India in 1996, but did not get the approval because there were concerns over national security and a cultural invasion. In 1997, the government even imposed a ban when the Rupert Murdoch-owned Indian Sky Broadcasting was about to launch its DTH services in India. Finally in 2000, DTH was allowed. The new policy requires all operators to set up earth stations in India within 12 months of getting a license. DTH licenses in India will cost $2.14 million and will be valid for 10 years. The companies offering DTH service will have to have an Indian chief and foreign equity has been capped at 49 percent. There is no limit on the number of companies that can apply for the DTH license.
Structure of the Indian DTH industry
The structure of the DTH industry in India can be categorized as an “Oligopoly”. An oligopoly is a market form in which a market or industry is dominated by a small number of sellers. An oligopoly is a market dominated by a few large suppliers. The degree of market concentration is very high. Firms within an oligopoly produce branded products and there are also barriers to entry.
Infrastructure & Investment * It requires large amount of investments to build up high cost equipments, transponders and maintaining infrastructure over a larger area.
Government regulations and licensing * Entry into market regulated by the GOI’s body called as TRAI * 40% of the cost of providing DTH services are incurred due to high tazations * License fee is very high

Presently these are the main DTH service providers in India: * DD Direct * Dish TV * TATA Sky * Sun Direct * Reliance Big TV * Airtel Digital TV * Videocon D2H

Performance and Growth of Industry

The Direct-To-Home (DTH) market in India is anticipated to grow over three times to cross $5 billion by 2020, according to a new report by research firm Media Partners Asia. The strong growth in revenue is attributed to the mandatory cable TV digitization would help the DTH players expand their subscriber base considerably, said the study.
As per the report, Dish TV continued to lead with a market share of 23% per cent in, while Videocon Direct to Home accounts for 14%. Tata Sky and Airtel Digital TV have 19 per cent and 19 per cent market share, respectively. These four players together accounted for 75 per cent of total gross additions in 2012. The study noted that the cumulative DTH active subscriber base stood at 48.8 million subscribers versus 28.7 million subscribers in 2011.

The mandatory cable TV digitization is helping the Direct-to-Home (DTH), or satellite TV players, to expand their subscriber base, which stood over 48 million last year. While phase 1 of digitization saw around 10 million TV homes in the four metros convert to digital, over 90 million analogue cable TV homes are estimated to go digital by the end of the fourth phase in December 2014. For the uninitiated, digitization is being carried out in four phases. In the first phase, which ended on December 31, 2012, the four metros switched to set-top boxes (STBs).

In the second phase, 38 cities in 15 states moved to STBs by March 31, 2013. In the third phase – the deadline for which is September 30, 2014 – all urban areas of India have to switch to STBs. By December 31, 2014, the entire country will have to switch to STBs.
As a result of this digitization drive, the DTH sector, which has clocked phenomenal growth ever since the category was first introduced in India, is set to grow at an even more furious pace.

* For Q1 FY13, Airtel reported 7.4 million Airtel DTH subscribers. * For Q1 FY13, Dish TV reported 13.4 million subscribers. * For Q1 FY13, RCOM’s Reliance Digital TV reported 4.4 million subscribers.
Players in the Market
DD DIRECT
Doordarshan is the public television broadcaster of India and a division of Prasar Bharati, a public service broadcaster nominated by the Government of India. It is one of the largest broadcasting organizations in the world in terms of the infrastructure of studios and transmitters. Recently, it has also started Digital Terrestrial Transmitters. On September 15 2009, Doordarshan celebrated its 50th anniversary. National telecasts were introduced in 1982. In the same year, color TV was introduced in the Indian market with the live telecast of the Independence Day speech by then Prime Minister Indira Gandhi on 15 August 1982, followed by the 1982 Asian Games being held in Delhi. Now more than 90 percent of the Indian population can receive Doordarshan (DD National) programmes through a network of nearly 1400 terrestrial transmitters and about 46 Doordarshan studios produce TV programs today.

DD Direct+ is a free Direct to Home (DTH) service that provides satellite television and audio programming to households and businesses in the Indian subcontinent. Owned by parent company Doordarshan, DD Direct Plus was launched on December 16, 2004. Now chairman of DD plus+ is Shri Arun Bhatnagar and CEO is B S Lalli under the ministry of information and broadcasting. Dish TV
Dish TV is the first private DTH satellite television provider in India. Dish TV's managing director and Head of Business is Jawahar Goel who is also the promoter of Essel Group and is also the President of Indian Broadcasting Foundation and Mr. Subhash Chandra is the Chairman of Dish TV. Dish TV is a division of Zee Network Enterprise (Essel Group Venture). It not only transmits high quality programmes through satellite but also gives a complete control of selecting channels and paying. DTH service was launched back in 2004 by launching of Dish TV by Essel Group's Enterprises. Dish TV is on the same satellite where DD Direct+ is.

Tata Sky
Tata sky was incorporated in 2004. Tata Sky is a JV between the TATA Group and STAR. Tata Sky DTH endeavors to offer Indian viewers a world-class television viewing experience through its satellite television service. Vikram Kaushik is present CEO of Tata Sky Ltd. The SKY brand, owned by the UK-based British Sky Broadcasting Group, brings to Tata Sky the reputation of more than 20 years experience of satellite broadcasting. SKY is well known for the innovative products and services launched by BSky, such as DTH broadcasting in 1989, digital satellite broadcasting in 1998, interactive television services in 1999 and the SKY+ personal video recorder in 2001.

In October 2008, Tata Sky announced launching of DVR service Tata Sky+ which allowed 45 hours of recording in a MPEG-4 compatible Set Top Box. The remote is provided with playback control keys and is being sold with special offers for existing subscribers. Tata Sky was selected as a SUPER BRAND for the year 2009-2010 by an independent and voluntary council of experts known as Super brands Council. It is the only Indian DTH to have won this distinction.

Sun Direct
Sun Direct is a DTH service in India headquartered in Chennai, Tamil Nadu. Sun Direct TV was registered in February 16, 2005. However, the failed launch of INSAT 4C resulted in a lack of transponders, delaying the launch. The service was finally launched on December 2007 after availability of transponders from INSAT 4CR. Because of the lowest pricing of any DTH in India Sun Direct spread rapidly all over the country. On December Sun Direct was launched in Mumbai and announced its pan India launch. By 2009 it became leading DTH provider with 3 million subscribers. This makes it 4th largest DTH service provider of India. In April 2009 Sun Direct officially launched its High-Definition service in India. Sun Direct uses the latest MPEG-4 based technology to increase broadcast capacity.

BIG TV
Reliance BIG TV is a DTH satellite television provider in India based in Navi Mumbai, using MPEG-4 digital compression technology, transmitting using MEASAT-3 91.5°east. It is the 5th DTH service launched in India. Reliance BIG TV limited is a part of Reliance Communications Ltd., a subsidiary of Reliance Anil Dhirubhai Ambani Group founded by the Late Dhirubhai Ambani, the Indian business tycoon and owned by his son Anil Ambani. BIG TV started operations from 19 August 2008 with the slogan "TV ho Tho BIG Ho" ("If you have a TV, make it BIG"). It currently offers close to 200 channels and many interactive ones, 32 cinema halls (i.e. Pay Per View Cinema Channels) as well as many Radio channels.

Reliance BIG TV's retailer network is spread across 100,000 outlets in 6,500 towns in India. This was literally unheard of in the DTH industry. They had effectively out-stripped the competition here. When it came to pricing – packaging, their introductory offer stood at Rs. 1,490/- with 3 to 6 months of free subscription. They also introduced 32 Pay-Per-View Movie Channels, the highest by any DTH player.

Airtel digital TV
Airtel Digital TV is a DTH (Direct to Home) service from Bharti Airtel. It uses MPEG-4 digital compression with DVB-S2 technology, transmitting using INSAT 4CR 74°E Airtel digital launched on 8 October, 2008 with a 360 degree mega campaign 'Come Home to the Magic. Since then it has launched 2 other campaigns: ‘Stars come home’ (March 2009) and ‘DTH Picture Clarity (August 2009) has increased its channel base to 183+ channels. Airtel digital TV is now amongst the fastest growing DTH brands in the country and is available across 5000+ towns in India. It has also been ranked as the best DTH service by “Living Digital” magazine. Airtel chief Sunil Mittal said that Airtel digital TV and other DTH players have a bright future in Indian market as the people are getting more attracted towards DTH because of its quality and affordability.

Videocon d2h
Videocon d2h is a DTH satellite television provider in India based in Mumbai, using MPEG-4 with DVB S2 digital compression technology. Videocon Leasing & Industrial Finance Limited was incorporated on 4th September, 1986 as Adhigam Trading Private Limited. In terms of the necessary resolutions Passed under Sec. 21 of the Companies Act, 1956, the name of the Company was changed to Videocon Leasing & Industrial Finance Limited on 14th February, 1991. The Company received a fresh certificate of incorporation from the Registrar of Companies, Gujarat at Ahmedabad on 14thFebruary, 1991. Videocon d2h launched May 1, 2009. It came with a very good strategy for selling both of its electronic products like TV’s DVD’s along with the new set top box. This is offering direct to TV without any set top box also. Only the antenna is enough, it also came with DVD which is connected directly to the TV or antenna is connected to DVD which gives a best quality of output.

Porter’s Five Competitive forces: Direct to Home

1)Buyers: Bargaining power of buyers
With enough options to choose both from the point of alternate mediums like Cable and increased DTH operators, the consumer is at his will to decide. Customers will continue to have a high bargaining power until DTH platforms try to differentiate them as superior players with better content and clarity.

2)Suppliers: Bargaining power of suppliers
DTH industry relies on three major supplies: Customer Premise Equipment (CPE) comprising of the satellite dish, Set Top Box with the necessary access card, the Ku band transponders in the orbiting satellites and content. With India overtaking Japan as Asia’s largest DTH, the bargaining power of Indian DTH operators with CPE supplies have increased

3)Potential Entrants: Threat of new entrants
With already 7 players in the DTH space, threat of new entrants is relatively low. There is already enough competition which will discourage new firms to enter this business. While getting a license is relatively easy, the barriers to entry are high when it comes to pricing of CPE and getting the required transponders.

4)Substitutes: Threat of substitutes
DTH faces stiff competition from the terrestrial, cable and IPTV. As per the industry estimates, there are 130 million TV homes of which 97 million are served by cable and around 15 million by DTH with the remaining taken by terrestrial transmission.

5)Industry competitors: Segment rivalry
As explained above there is perfect competition exists in this industry.

Focus and Differentiation

* DD Direct – state owned free service provider * Dish TV – Focuses on market share * TATA Sky – Focusing more on customer service * Sun Direct – Focuses on cost effectiveness * Reliance Big TV - Owned by Reliance group, new entrant into the market. * Airtel Digital TV – Focuses on digital clarity * Videocon D2H –Focuses on Technology

Consumer Behaviour Pattern
Major Factors influencing the purchase decision of DTH are as below:
 Price
 Customer Service
 Reception
 Program choices
 New Technology and
 Technical Support

Tata Sky Services

Tata Sky DTH It is basic service which is offered by tata sky. Through this service customer will get new connection and standard installation for Rs.2000Tata Sky HD Tata Sky brings you the latest digital revolution, Tata Sky HD DTH service. With great picture quality, incredibly vivid colours, sharper images and stunning surround sound, this new service will give you a breathtaking entertainment experience right at your home. Tata Sky HD DTH service gives you a better TV viewing experience with an aspect ratio of 16:9 and 1080i resolution, which means you get to see a lot more of what you are watching. Subscribe to Tata Sky HD DTH service today, and take your TV viewing experience to a whole new level.Tata Sky +HD1)Pause / Rewind / Forward: Never miss your favourite scene again! Skip the boring clips, replay the scene you want and freeze your favourite moments. Television, as you like it.2)Catch-up TV: Download and watch 5 day old episodes of TV shows if you have missed watching them before3)Record from Mobile & Internet: Now record your favourite shows even when you’re away from your TV, with the Dual Access Remote Recording feature. Just SMS RR to 56633 to download the Tata Sky Mobile App, or use the Internet Recording feature on www.mytatasky.comMultiTV connection | Purchase one MultiTV connection per television. | | Watch different channels on different televisions at any given time | | Subscription charges for the 1st connection applicable as per the package selected | | Avail of the same package on the 2nd, 3rd and 4th connection through a MultiTV connectionThe subscription charges for each MultiTV connection is dependent on the box type connected & is as follows. Price of Tata Sky connection extra as per ongoing offer: Pack | Monthly (Rs) | Semi-Annual (Rs) | Annual (Rs) | MultiTV - Standard Box | Rs 180 | Rs 1,000 | Rs 1,980 | MultiTV - HD Box | Rs 200 | Rs 1,133 | Rs 2,200 | | Intractive TV 1)Actve Music : Your music at your time!2)Actve Fun Learn : Set the right foundation for your child′s overall development3)Actve Cooking : Delectable recipes that you can make at home!4)Actve English : Get the competitive edge and a better command over the English language.5)Actve Darshan : Actve Darshan features 7 spiritual channels and live telecast from 6 revered temples across India.6)Actve Games : The safe gaming destination for your child!7)Zeetos Rewards : Play to get free toys!8)Actve Vedic Maths : Solve faster. Score better. Get an edge in competitive exams in just 60 days!9)Showcase : Your private multiplex at home10)VoD : Watch your favourite Movies, TV shows, Concerts, Theatre Plays and lots more whenever you want.Packages Offering by Tata Sky1)TruChoice Channel Packages * » Base Packs * » Add-On Packs * » Active Packs * » Special Packs * » Regional Packs * » HD Access Fee * » Mega Pack * » Long Duration Pack * » Multi-TV2)Make My PackStrategies followed by Tata Sky1)Tata sky is ensures installation within 24 hours, whereas other services takes 48 hours.2)Tata sky offering affordable pricing and attractive packages3)Tata Sky claims to respond to customer complaint within 6 hours or in some cases much earlier4)Advertising & Promotion: TV broadcasters are expected to increase advertisement rate this year by 16-18%. Tata sky uses different marketing strategies for promotion and sales of its products. It gives advertisements with their brand ambassadors which attract customers, door to door selling, on the phone selling, discount and offer sales, packages, etc. Tata sky is having Super Star Aamir khan as brand ambassador.Promotion of Tata SkyThe promotional strategies suggested are: 1. Packages for Special Events like the cricket World Cup 2. Targeting Tata employees could be a useful way pr promoting the product 3. Give the option of instalments and other promotional schemes to the new users 4. Tie up with real estate developers to target the new constructions a. The number of old buildings being demolished and being reconstructed are also on the rise. This could be a major target for promotions 5. Door to door marketing should be used to heighten the awareness levels as well 6. Local Games Sponsorships can also be used to increase the awareness levels 7. Another way could be using the prominent part of the Building for placing Hoardings of Tata Sky Ads a. Finding the strategic building in the locality b. Consideration can be in form of cash payment to the Housing society c. Providing free connections to Households in these buildings 8. Another new avenue that can be explored is the railway stations: a. Posters on railway station roofs b. Tickers at Major suburban Railway stations 9. Use of Internet- Applications which involve sharing of videos on how one consumes TV, benefits of DTH over cable TV, etc. across social networking sites like Orkut, ibibo, etc. 10. 'Ek-pe-Teen and Do-pe-Paanch' the offer entails three months of free subscription on the purchase of one connection, and five months of free subscription on purchase of two or more connections. 11. Tata Sky launched an interactive game quiz featured around MS Dhoni to coincide with the Twenty20 World Cup. In the past, the DTH operator has been test-piloting feature by running several contests around programmes and the interactive features were made available to its customers. | | | | | | |

References

Financial Express-26th August,2012
Business Standard-16th September,2012
The Hindu Business Line-21st September,2012 www.indiastat.com www.tatasky.com www.sundirect.in www.dishtv.in www.bigtv.co.in www.airtel.in

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