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RC Venkatesh, CEO, Dish TV says, on CNBC-TV18, that the price of the set-top box (STB) was increased from Rs 1,600 to Rs 2,000 only after the gauging the market's ability to absorb the hike. The hike is likely to only impact new connections and has considerably reduced the subsidy on set-top boxes, he added.
"Our capex plans are dependent on deployment of set-top boxes. We will be able to cater to costs out of internal accruals and the impact of the price-hike on subscriber acquisition costs (SAC) will be clearly evident in Q1 of next fiscal."
Below is the edited transcript of the interview on CNBC-TV18
Q: Why have the prices of set-top boxes increased for the third time?
A: It is the prices of the set-top boxes that have gone up and not the prices of the packages. The price of a set-top box has gone up from around Rs 1,600 to Rs 2,000. We have also observed that increases in set-top box prices have been absorbed by the market very comfortably. Given the fact that there is an element of subsidy involved even at the current level of prices, we were able to hike those prices and reduce the subsidy.
Q: The average revenue per user in Q3 stood at Rs 160. What kind of an impact will the hike in set-top box prices have on average revenue and what is your guidance on the average revenue per user?
A: This will only impact new connections purchased by customers. Only package prices have the ability to impact the average revenue per user and that remains the same.
Q: Is there any possibility of a hike in package prices?
A: That possibility cannot be ruled out. We will have to gauge market circumstances and take a decision accordingly.
Q: What is your status in the second phase of digitisation with the deadline fast approaching? What has been your experience so far and how much do you expect to cover by the end of the deadline?
A: We will have to see as there are still a lot of loose ends that need to be tied up. We will have to see how it plays out. The next two-three weeks will be important to understand how it will roll out.
Q: You had previously stated that you were confident of meeting your capital needs through internal accruals. How much cash are you sitting on and what are your capex plans for current and next year?
A: Capex plans are linked to total set-top box deployment. With the increases in set-top box prices that we have initiated, the subsidy element on the set-top box continues to come down and that makes us comfortable in terms of our ability to manage all the requirements of set-top-box purchases with internal cash accruals.
Q: What about the cost of subscriber-acquisition? Will there be further reductions for subscriber acquisitions?
A: The prices of set-top boxes have increased by almost Rs 400 per box and that will reduce the subscriber acquisition cost (SAC). Though not all of it will reflect in this quarter, the full impact will be seen in Q1 of next year. However, even in this quarter there will be a substantial reduction in the SAC.
RC Venkatesh, CEO, Dish TV says, on CNBC-TV18, that the price of the set-top box (STB) was increased from Rs 1,600 to Rs 2,000 only after the gauging the market's ability to absorb the hike. The hike is likely to only impact new connections and has considerably reduced the subsidy on set-top boxes, he added.
"Our capex plans are dependent on deployment of set-top boxes. We will be able to cater to costs out of internal accruals and the impact of the price-hike on subscriber acquisition costs (SAC) will be clearly evident in Q1 of next fiscal."
Below is the edited transcript of the interview on CNBC-TV18
Q: Why have the prices of set-top boxes increased for the third time?
A: It is the prices of the set-top boxes that have gone up and not the prices of the packages. The price of a set-top box has gone up from around Rs 1,600 to Rs 2,000. We have also observed that increases in set-top box prices have been absorbed by the market very comfortably. Given the fact that there is an element of subsidy involved even at the current level of prices, we were able to hike those prices and reduce the subsidy.
Q: The average revenue per user in Q3 stood at Rs 160. What kind of an impact will the hike in set-top box prices have on average revenue and what is your guidance on the average revenue per user?
A: This will only impact new connections purchased by customers. Only package prices have the ability to impact the average revenue per user and that remains the same.
Q: Is there any possibility of a hike in package prices?
A: That possibility cannot be ruled out. We will have to gauge market circumstances and take a decision accordingly.
Q: What is your status in the second phase of digitisation with the deadline fast approaching? What has been your experience so far and how much do you expect to cover by the end of the deadline?
A: We will have to see as there are still a lot of loose ends that need to be tied up. We will have to see how it plays out. The next two-three weeks will be important to understand how it will roll out.
Q: You had previously stated that you were confident of meeting your capital needs through internal accruals. How much cash are you sitting on and what are your capex plans for current and next year?
A: Capex plans are linked to total set-top box deployment. With the increases in set-top box prices that we have initiated, the subsidy element on the set-top box continues to come down and that makes us comfortable in terms of our ability to manage all the requirements of set-top-box purchases with internal cash accruals.
Q: What about the cost of subscriber-acquisition? Will there be further reductions for subscriber acquisitions?
A: The prices of set-top boxes have increased by almost Rs 400 per box and that will reduce the subscriber acquisition cost (SAC). Though not all of it will reflect in this quarter, the full impact will be seen in Q1 of next year. However, even in this quarter there will be a substantial reduction in the SAC.
