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Indian operators increases prices after similar move from DTH market leader

Bapun Raz

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Indian operators increases prices after similar move from DTH market leader.
Bharti Airtel Ltd. and Reliance Communications Ltd. have raised prices of set-top boxes for direct-to-home television services to new customers and cut free-view periods to offset rising input costs and turn profitable.

Bharti Airtel raised prices of set-top boxes by INR243 each from July 4 while Reliance Communications increased prices by INR200, executives at the two companies told Dow Jones Newswires Wednesday.

The two companies are among India's top DTH television distributors. Bharti is also India's largest mobile-phone operator by subscribers, and Reliance Communications is the second-largest.

The price increases come after Dish TV India Ltd., the country's largest DTH operator by users, raised prices of its set-top boxes by up to INR200 from July 1.

India's DTH companies offer discounts on hardware such as set-top boxes and dishes, and offer free viewing for a few months to attract customers because of stiff competition, specially from cable operators. Reducing the subsidies will help these companies to turn profitable with fewer customer additions.

A Bharti executive, who didn't want to be named, said that the company has also reduced its free-view period for sports television channels to two months from three earlier.

Reliance Communications has reduced the free-view period by a month to two months for new subscribers in the country's north, east and west regions, said Sanjay Behl, chief executive of Reliance BIG TV, the DTH and Internet television unit of Reliance Communications.

Bharti had more than 6.0 million users for its digital TV services at the end of March, while Reliance BIG TV had 3.5 million users.

Analysts say local DTH operators need to have at least 7.0 million users to turn profitable at the operating level.

For the financial year ended March 31, Bharti Airtel's digital TV services unit posted an operating loss of INR10.32 billion on revenue of INR10.32 billion.

Reliance BIG TV posted an operating loss of INR949 million on revenue of INR3.64 billion for the January-March quarter.

http://www.totaltele.com/view.aspx?ID=466411
 
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