July 1, 2012 would mark as an important milestone for cable and satellite (C&S) sector in India with mandatory digitization completed for all the four metropolitan cities and the process is to be completed by March 2013 throughout the country. In an interview with Sharan Poovanna of TNIE, Shashi Arora, CEO-DTH/Media of Bharati Airtel speaks about the changes and advantages of mandatory digitization. Excerpts:
What are the advantages of DTH as against regular cable?
It’s just a misconception that DTH is expensive like how earlier mobile phones were considered expensive. Cable got its feet from dense cities like Mumbai where it is easier to use cable. DTH, on the other hand, is useful for cable dark areas. With the flexibility of regional language packs, customers would have the choice to pick their choice of language based channels.
Does the sector have adequate infrastructure and supplies to meet the demand for DTH before March 2013?
I can talk about my company and we have experienced a demand surge in the past, during festive period or during a cricketing event. We were the first ones to provide HD box and could offer cricket World Cup in HD. We have invested money in capital expenditure and if more investment is needed we are well equipped to do so.
What is the initial expenditure for changing from cable to DTH platform?
The standard definition set top box costs `1,590 and will have all channels free for a month, and monthly tariff from 2nd month will be `155 in southern India. On box we incur roughly 50% subsidy.
Even though some players are in this industry for 8-10 years, they haven’t been very profitable. This is because of the cost incurred in these boxes and also due to Government rules. 33% goes to Government for every 100 that we collect from customer; about 10% goes as for licensing of every set top box and 11% goes as entertainment tax and 12% service tax.
Your comments on logistics challenge for this conversion
As we have been in this business for couple of years we know how to carry inventory, push capital where it is required. We have 1,500 partners around the country and 35,000 retailers who work through these distributors.
What about serviceability in remote regions?
There are 1,500 distribution and service partners. Internally we monitor such problems within 4 hours. Besides, the 1,500 partners will provide serviceability.
