DTH players may get large share in last phase of digitisation


Dream Expert
30 Sep 2012
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The direct-to-home players are expected to get
a big share of the digitisation market in the
phase IV areas as the fragmented market will
not be profitable for cable operators, says rating
agency ICRA.

"DTH players are expected to take a lead in
Phase IV markets as the catchment area (less
than 15,000 households) in these markets
remains highly fragmented and therefore
unprofitable for cable operators to penetrate," it

The government has set a timeline to complete
the digitisation in four phases. Phases I and II
covering metros and 38 cities are already over.
The Phase III deadline (all urban areas) was
December 31, 2015 and the Phase IV deadline
(the rest of India) is December 31, 2016.
ICRA noted that while DTH players have been
able to leverage their inherent technology
advantage in cable dark areas of Phase III
markets, Multi System Operators (MSOs)
continued to gain a favourable market share in
such areas which remained contiguous to
Phase II markets such as Gurgaon and Noida in
NCR and certain parts of Mumbai.

The rating firm believes the cable average
revenue per user (ARPUs) in Phase III markets
have the potential of growing from the existing
levels of Rs 10-15 per subscriber per month to
more than Rs 50 per subscriber per month.
"In the current fiscal, the revenue growth for
MSOs will be driven by activation income.
However, over the medium term, monetisation
of the digital subscriber universe in Phase III
markets offers high subscription revenue growth
potential for players," it added.

At present, the implementation has been stayed
for varying periods across Phase III markets of
Maharashtra, Andhra Pradesh, Assam, Odisha,
Sikkim, Telengana apart from Tamil Nadu where
digital addressable system (DAS)
implementation has been challenged since
Phase I rollout.

Consequently, nearly 4.9 million households
have further been removed from Phase III
bringing down the total addressable population
from 38.8million households to 33.2 million, with
the maximum impact being felt in West Bengal,
Kerala, Goa and Jharkhand.

DTH players may get large share in last phase of digitisation
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