DTH Subscribers Gain Momentum

The DTH companies are expecting windfall additions in subscribers from Phase 3 and Phase 4. Even if the
deadline is extended by a few months, the DTH companies remain confident of seeding boxes on voluntary basis. We estimate that the pace of subscriber addition can accelerate from 10m p.a. to 12m if Phase 3 digitisation is successful. Our checks confirm that gross incremental market share of the top 3 players—Dish TV, Videocon d2h and Tata Sky—is in excess of 75%.

DTH players were happy with the Star RIO (Reference Interconnect Offer) deal. They believe that this has forced cable companies to introduce tiering of content and is a precursor to an increase in consumer ARPU.

We do not think the daily recharge option changes the industry dynamics in a meaningful way. Our checks suggest that there has been no market share shift post the launch of the scheme by one of the DTH players and we might not see competitors launching a ‘me-too’ product.

The industry is in wait-and-see mode over the potential entry of Reliance Jio as a cable MSO. Potential
subsidy on set-top box by the company can be disruptive for the industry.