MUMBAI: Direct-to-Home (DTH) satellite television service, hitherto the domain of Zee Group's Dish TV and Doordarshan through its free-to-air (FTA) channels, is seeing increased interest on the part of large business houses and has emerged as a major challenge to the established cable TV. DTH has seen the Tatas, along with Star, launch Tata Sky last month and even the Reliance-ADAG Group and Sun TV have announced their intention to enter this segment.

India has around 110 million TV homes, of which, 68 million are cable and satellite (C&S) homes, while the remaining are without access to cable or satellite TV. With over 3.5 million subscribers, DTH penetration is around five per cent of the C&S homes. A PricewaterhouseCoopers study estimates the figure to reach ten million by 2010.

Speaking to The Hindu, Jawahar Goel, Head, Business, Dish TV, and Additional Vice Chairman, Essel Group, said, "From the current market size of around 3.5 million connections, I estimate that by 2015, DTH will reach 30-35 million. The increasing popularity of DTH services will stir up not only growth within the segment, but also in the cable TV system. Cable operators, especially multi-system operators (MSOs), are gearing up with their offering of digital cable to compete against the DTH services.''

Dish TV has now around 1.4 million subscribers and, according to Mr. Goel, is adding 30,000 subscribers a week. It is targeting 13.2 million subscribers and a market share of 40 per cent by 2015.

"To date we have invested around Rs. 400 crore in the services and equipment (including Set Top Boxes and the like). By 2015, we would have invested a further Rs. 600 crore. We, after all, enjoy the first mover advantage and have very competitive rates with the channels compared to the newer entrants.''

Since launch last month, Tata Sky has already garnered over one lakh subscribers.

Reliance-Anil Dhirubhai Ambani Group (ADAG) received the permission to operate DTH broadcast services, which has been christened Blue Magic.

According to Vikram Kaushik, CEO and MD, Tata Sky, "There is a restructuring in TV distribution. Cable and DTH will co-exist at least for another decade. (Example: while in the U.S., 70 per cent TV homes are cable and 30 per cent are DTH, in the U.K. 70 per cent TV homes are DTH and 30 per cent are cable). Co-existence of both technologies is of the essence. In terms of competition, I think too much is being made of IPTV (Internet Protocol Television) and it will emerge as an alternative in India only after five years.''

According to a FICCI-PricewaterhouseCoopers 2006 study, `The Indian entertainment and media industry,' "in the coming years, the last-mile of television distribution will see a lot of action with the entry of new DTH and IPTV players. Digitalisation too is likely to happen over the next couple of years. As a result, subscription revenues are bound to increase and are likely to drive growth in the television segment. With improvement in quality of transmission and content, coupled with economic growth, television penetration is bound to increase by leaps and bounds thereby fuelling the growth of TV advertising and content software also.''

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