How does
DTH really differ from cable TV?
The way
DTH reaches a consumer's home is different from the way cable TV does. In DTH,
TV channels would be transmitted from the satellite to a small dish antenna
mounted on the window or rooftop of the subscriber's home. So the broadcaster
directly connects to the user. The middlemen like local cable operators are not
there in the picture.
DTH can
also reach the remotest of areas since it does away with the intermediate step
of a cable operator and the wires (cables) that come from the cable operator to
your house. As we explained above, in DTH signals directly come from the
satellite to your DTH dish.
Also, with
DTH, a user can scan nearly 700 channels!
Does one
need to put two dish antennae and pay double subscription per month if one has
two TVs?
For multiple
connections in the same premises, one can use the same connection. However,
every television set will need to have an individual STB.
Also, DTH
is a national service and the STBs enable a viewer to change service providers
without changing the STB, even if one moves from one city to another.
Can a CAS
set-top box be used for DTH?
No, these
are different set-top boxes.
Why is DTH
is being discussed now?
Doordarshan
plans to launch its DTH telecast from April 1. The government has said it will
provide 10,000 dishes free across eight states for increased community viewing
of the DTH service. The government is estimated to be investing over Rs 300
crore (Rs 3 billion) in this DTH venture.
There are
four serious contenders for DTH services in India: Doordarshan, Star, Zee, and
Data Access.
Is DTH
superior to cable TV?
Yes. DTH
offers better quality picture than cable TV. This is because cable TV in India
is analog. Despite digital transmission and reception, the cable transmission
is still analog. DTH offers stereophonic sound effects. It can also reach
remote areas where terrestrial transmission and cable TV have failed to
penetrate. Apart from enhanced picture quality, DTH has also allows for
interactive TV services such as movie-on-demand, Internet access, video
conferencing and e-mail. But the thing that DTH has going for it is that the
powerful broadcasting companies like Star, Zee, etc are pushing for it.
So why are
broadcasters pushing for DTH?
In DTH,
the payments will be made directly by the subscriber to the satellite company
offering the service.
A big
problem that broadcasters face in India is the issue of under-reporting of
subscribers by cable operators.
Consider
the cable operators pyramid. Right at the top is the broadcaster. Next comes
the Multi Service Cable Operator (MSOs) like Siticable, InCable, etc. Below
them are the Access Cable Operators (ACOs) or your local cable guy who actually
lays the wires to your house.
The local
cable operators or the ACOs then allegedly under-report the number of
subscribers they have bagged because they have to pay the MSOs something like
Rs 30-45 per household. Showing a lesser number of households benefits ACOs.
With no
way to actually cross check, the MSOs and the broadcasters lose a lot.
Broadcasters do not earn much in subscription fees and are mostly dependent on
advertisement revenue to cover their costs, which is not sustainable and does
not offer high growth in revenues for broadcasters.
The way
out of this is to use a set-top box so that it will be clear how many
households are actually using cable or going for DTH where broadcasters
directly connect to consumers and can actually grow revenues with a growth in
the subscriber base.
Why do
Doordarshan, Zee, Star think DTH will work in India?
Today,
broadcasters believe that the market is ripe for DTH. The prices of the dish
and the set-top box have come down significantly. Overall investments required
in putting up a DTH infrastructure has dropped and customers are also reaping
the benefits of more attractive tariffs.
The major
thing that DTH operators are betting on is that the service is coming at a time
when the government is pushing for CAS (conditional access system), which will
make cable television more expensive, narrowing the tariff gap between DTH and
cable.
Will DTH
be cheaper than cable or more expensive?
DTH will
be definitely more expensive than cable as it exists today.
A set-top
box is a must for DTH. Earlier, when CAS made set-top box mandatory for
households, the costs between DTH and cable would not have been too wide.
But CAS on
the backburner now -- which means no set-top box (a must for DTH), the price
gap between DTH and cable will be wide.
In Oct
2002, Siticable, which is owned by Zee, said that the cost of the installation
equipment, which includes the receiver dish and the set-top box, would be
priced at around Rs 3,900. Siticable is looking to rope in 1 million
subscribers in 15 months.
Other
estimates say that digital cable set-top box may cost Rs 4,000, a DTH decoder
dish is unlikely to cost less than Rs 7,000.
DTH's
minimum subscription could be priced around Rs 500 per month.
Some
reports say that an entry level DTH STB will cost about Rs 7,000 (including
taxes and installation cost at consumers end). A more advanced STB with value
added features like PVR (Personal Video Recorder), PSTN connectivity, Gamming
console, channel management system, etc. may cost as much as Rs 15,000.
What is
the history of DTH in India?
DTH
services were first proposed in India in 1996. But they did not pass approval
because there were concerns over national security and a cultural invasion. In
1997, the government even imposed a ban when the Rupert Murdoch-owned Indian
Sky Broadcasting (ISkyB) was about to launch its DTH services in India.
Finally in
2000, DTH was allowed. The new policy requires all operators to set up earth
stations in India within 12 months of getting a license. DTH licenses in India
will cost $2.14 million and will be valid for 10 years. The companies offering
DTH service will have to have an Indian chief and foreign equity has been
capped at 49 per cent. There is no limit on the number of companies that can
apply for the DTH license.
So, what's
the buzz? Will DTH finally be the one that rules?
The cable
system is well entrenched in India and is showing quite rapid growth. If DTH
had come to India in 1996-97 (like Star had originally attempted), then it
could have made a significant breakthrough.
Europe is
an example of this. DTH developed there before cable and now controls nearly 80
per cent of the total satellite television subscriber base. But in US, cable
rules because it came before DTH.
DTH will
definitely cut into the existing cable user base. It will make the local cable
operator less important and take business away from him. It will give consumers
greater choice.
But it is
likely to be an up market premium product and most middle class households will
stick to cable.
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