Reliance Communications (RCom) is likely to place an order for 5 million set-top boxes for its proposed direct-to-home (DTH) broadcasting venture, industry sources said.
Subsidiary Big TV DTH to start services in MarchNEW DELHI: Reliance Communications (RCom) is likely to place an order for 5 million set-top boxes for its proposed direct-to-home (DTH) broadcasting venture, industry sources said.
Big TV DTH Ltd, a fully owned subsidiary of RCom, is expected to commercially roll out its service next month.
DTH enables you to bypass the cablewallah and receive broadcasting signals directly into your premises through a set-top box.
Currently, there are two private DTH operators in the country-Dish TV of the Essel group and TataSky, a joint venture between the Tatas and Rupert Murdoch’s Star group.
Dish TV, the first DTH player in the country, has around 2.7 million subscribers, while TataSky has over 1.5 million.
Free-to-air DTH platform, DD Direct Plus, has a subscriber base of around 7 million, according to Prasar Bharati estimates.
Besides RCom, the others about to join the DTH race include the Bharti group and Sun TV. Recently, Bharat Business of the Videocon group also received government nod to start DTH operations.
It is learnt that the set-top boxes for Reliance’s DTH venture are being sourced from Korea, China and Taiwan.
Although the company had initially planned an order of around 2 million set-top boxes, subsequently it increased the target to 5 million, sensing an opportunity in the television market.
Of the 120 million TV households in India, only 70 million have cable connections.
DTH is still in its infancy in India, and there’s sufficient room for growth. By 2015, 40% of the pay TV universe (cable TV and DTH) is likely to be DTH users, significantly up from around the present 5%, according to industry projections
RCom, sources said, is looking at ways to reduce the cost of set-top boxes by up to 20% through its mega order.
The current landed cost of an MPEG4-enabled set-top box that RCom will deploy ranges from $55-$60 in the global market. The DTH platform of RCom is currently undergoing tests.
A recent analyst report by the Kotak group pointed out that the entry of more players would coincide with potentially aggressive pricing strategies in the DTH space.
The report added that “DTH subscriber volumes would grow strongly over the next several years, led by rising affordability”.
Recently, Dish TV CEO Arun Kumar Kapoor told DNA Money that “there’s room for 4-5 DTH players in the country”.
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