Indian bloggers mania: sridhar kondoji

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Reliance Big TV may not hit their target subscribers

Success in Mobile market needn’t translate success in DTH segment. Its not that simple nor they can assume that success is given. Look at google, being the world leader in search engine and given the fact that people spend lot of time on their google.com page, they could’t beat hotmail/yahoo in email market, couldn’t beat ebay in auctions/paypal market, couldn’t beat myspace/facebook in social networking areana.

Likewise, Reliance will also not be able to repeat the success story in DTH.
First of all, Reliance Big TV doesn’t offer anything special on the platter for existing DTH customers on DishTV/Tata Sky to switch over. Secondly, Reliance Big TV will not be able to move analog/digital cable customers onto DTH as costs wise DTH platform cannot beat them. Thirdly, Reliance Big TV is so over confident that they didn’t hire a brand ambassador like Shah Rukh or Aamir Khan.

With Videocon and Bharti on their way to DTH, Reliance Big TV is all set for a rude shock in amassing the required number of subscribers to achieve their break even target. With the above things in context, if Indian Government approves HITS platform clearly WWIL former siticable will walk away with customers sitting on the fence still deciding between analog and DTH technology.

Reliance, Bharti or Videocon has to acquire or partner with existing players to reach their own targets and also make this segment profitable.
I see, Sun’s DTH and Zee groups Dish TV, WWIL as clear acquisition targets for Reliance, Bharti companies.

The more they wait the ugly the competition will become and driving their acquisition costs.
Entire Zee group can be up for grabs by Bharti as this aquisition can pit against Reliance in Telecommunications space, entertainment space as well as cable segment.

At the very least, Reliance can go after entire Zee group or just cable business.
This is just my speculation and am watching this space with extreme caution and curiosity.
Let us see the what happens.

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WWIL, DISH TV could be acquisition targets

DTH space has just become on of the hottest grounds with the launch of BIG TV by RCOM.
Dish TV, Tata Sky were the only players in this field with combined 6-8 million subscriber base.  Big TV’s entry has raised the bar and the talk is increasing the space to about 30-40 million subscribers in 3-5 years.  How that is going to happen is yet to be seen. Bharti and videocone are also raring to enter this space and are making plans to laucnh their services soon. Dish TV and Tata sky are also ramping up their infrastructure and raising funds to acquire subscribers on a rapid pace.

However cable tv viewers are reluctant to pay mre than couple of hundred bucks for their entertainment and i don’t see a strong reason for them to switch from cable wallah to antenna wallah.
Unless there is a massive migration of cable tv viewers from analog medium to DTH platform,  i don’ see how RCom, Bharti and videocone are going to meet their numbers.

Apart from aggressive pricing, DTH space could be shrunk to just few players by acquisitions.
Tata Sky would try hard to remain under the fold of Tata. This leaves Wire and Wireless (WWIL) and Dish TV as attractive acquisition targets by Reliance, Bharti and videocone to meet their aggressive subscriber numbers.

No amount of goodies from DTH players can force cable tv viewers to digital platform.  DTH players cannot afford to drop their subscription charges to as low as RS 50 in few cities to as high as RS 150.

I don’t see how DTH players can become profitable without huge subscriber base and pricing as competitive as cable wallahs.
It will be interesting to watch this space.

Filed under: Finance India, India blogs, Indian Bloggers, , , , , , , , ,

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