Market Research On Potential Of Dth Technology

PREFACE

India, with its booming economy, plus 8 digit growth, is witnessing a surge in the income levels. This
has led to increased demand for entertainment and luxury and people now want to enhance their
television viewing experience. Their increased desire for superior video and audio quality has also
been reflected in our research findings. All this will sound music to the ears of all the DTH service
providers planning to increase their market share many fold.

The potential of DTH in Indian market is seemingly substantial. This has motivated us to undertake a
market research project to analyze and assess the future prospects of its acceptability and growth in
India. To make our project comprehensive and to make our results conclusive, we have done a
thorough analysis in terms of in-depth primary and secondary research.

Scanning through articles pertaining to DTH in newspapers, magazines and internet; interviewing
dealers and marketers, sales executives; getting questionnaires filled by 250 respondents; we are
confident that our findings present the facts as they are.

The whole project has been so designed that it not only meets the requirements of our course
curriculum, it also will be useful to existing and coming DTH service providers.

Research Methodology

Our report is an integral part of my Market Research paper, 3rd Semester of my Bachelor of
Business Studies (BBS) course at Shaheed Sukhdev College of Business Studies, D.U. this project
has been prepared under the guidance of our subject teacher, Mrs. Preeti Rajpal Singh. The project
aims to understand the consumers’ perception about cable service providers and the attributes they
would like to associate with television entertainment. We also aim to understand the perception of
users of the DTH technology about the various DTH service providers.

India, with its booming economy, plus 8 digit growth, is witnessing a surge in the income levels. This
has led to increased demand for entertainment and luxury and people now want to enhance their
television viewing experience. Their increased desire for superior video and audio quality has also
been reflected in our research findings. All this will sound music to the ears of all the DTH service
providers planning to increase their market share many fold.

We have tried to cover various dimensions in the report and tried to make it as comprehensive as
possible.
The entire research methodology is summarized below-

• Literature study of Principles of Marketing and Market research.

• Exhaustive study of secondary material on DTH available on magazines, newspapers and internet.

• Depth interviews of

o Dealers of DTH equipment

o Distributors and other marketers dealing with DTH

o Sales heads, sales executives and other company personnel of the DTH service providers.

• Observing the consumers’ perception and purchase patterns while visiting dealers and the kiosks
of the service providers.

• Understanding the consumer’s perception through structured questionnaires which were aimed to-

o Understand the attributes the consumers seek to associate with television entertainment.
(Common for all the respondents).

o Determine the initial investment per month charges people would be willing to pay for a DTH
connection(for non-DTH users)

o Understand the consumer’s perception of the competing service providers (for DTH users)

o Pilot survey of 25 respondents (10% of the total sample)

o Analysis and interpretation of the findings from the questionnaires.

o Project submission.

The project took us 4 weeks for completion. The whole research and analysis schedule can be
summarized as below-

Week 1

• Literature study of principles of Marketing and Market Research.

• Exhaustive study of the secondary study and related articles pertaining to DTH available on
newspapers, magazines and internet.
Week 2

• Exhaustive study of the secondary study and related articles pertaining to DTH available on
newspapers, magazines and

• Depth interviews of dealers and other intermediaries.

• Depth interviews of sales executives and other company personnel.

Week 3

• Depth interviews of dealers and other intermediaries.

• Getting questionnaires filled by respondents from different parts of Delhi and from different
backgrounds.

Week 4

• Getting questionnaires filled by respondents from different parts of Delhi and from different
backgrounds.

Week 5

• Analysis and presentation of data.

• Interpretation of findings.

• Report preparation and findings.

SECONDARY RESEARCH

The Concept of DTH

-The Indian Perspective

The History of DTH

Watching television is no longer what it was a few years back. Today we have the concepts of DTH
and CAS in operation. . Bad transmission quality, blackouts, disconnection of channels, high cable
bills -- all these are history now. Direct-To-Home (DTH) television service, more popularly known as
direct broadcast satellite service was first proposed in India in 1996. But it 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. Nearly, three years after well-heeled Indian Television Viewers
were tantalised by the prospect of unrestricted access to hundreds of global channels, the Union
Cabinet on 2nd November 2000, finally cleared Direct-to-Home (DTH) broadcasting. The new policy
required all operators to set up earth stations in India within 12 months of getting a license. The
companies offering DTH service 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. Today
DTH has become an alternative to traditional Cable TV in India.

WHAT IS DTH

Direct-to-Home is essentially a delivery system. A DTH subscriber can get all the channels with a
pizza-size dish antenna and a decoder box. He doesn't need a cable connection or huge dishes that
are required for C-band (the frequency on which Star and other channels broadcasts). DTH is
telecast on the KU-band. This is merely a stronger signal, which is encrypted by the decoder and
accessed by the subscriber. Under C-band range the cable operators were already providing DTH
service. But the operators have to depend on a 12 feet diameter dish antenna and they could
receive only 20 channels. But when KU-band comes into existence it can receive up to 200 channels
with a tiny 12-inch dish antenna. The opening up of the DTH television service is expected to lead to
a technology war between 'open architecture system' and 'proprietary system'. The Open
Architecture Technology enables a subscriber to access more than one DTH service. One-time
investment in the set-top box or integrated receiver decoder required even if one wants to shift to
another platform. Other service can be accessed by changing an access card. The proprietary
Technology enables the customer to access only the service provided by one operator. Each time
the subscriber wants to shift to another service or platform it would be necessary to make changes in
the existing hardware. Other services cannot be accessed.

The open architecture system means technology similar to the cellular phones currently in vogue in
the country. In this case, DTH subscribers would have to make a one-time investment in the
hardware. The consumer's preference on the service would depend on the access card (akin to a
SIM card), that will be provided by the operator.

On the other hand, proprietary technology implies that hardware for DTH is made to the specification
of one particular operator, which can only accept the access card provided by the particular party. If
the subscriber wishes to shift to the similar service he would have to invest in new hardware again.

Now, when DTH is allowed with proprietary technology then it means either blocking of entry of
competitors or, making it imperative for the government to issue licence to the operators providing
the service at a later stage.
Keeping the subscribers in mind the government at a later stage would not be in a position to deny
the subscriber a licence under the Broadcasting Act. Though it is not a good idea to block any form
of technology from entering the country, it may be desirable on the part of the government to spell
out clear-cut policy guideline on DTH. This may prevent the possibility of a monopoly in DTH
services.

The proprietary technology versus open architecture technology debate still remaining a major bane
of contention, some DTH operators favour a receiver which will allow the consumer to use only its
signal. The open method allows the consumer to buy a receiver, a very expensive piece of
equipment, form a DTH provider and have the option of receiving signals from any DTH provider
later. The proprietary option will benefit consumers who subscribe to one-DTH provider.

THE POLICY

The policy on DTH includes the following clauses:

• Companies to beam from India,

• Separate licenses for internet, fax services on DTH,

• Company's CEO and majority of directors to be resident Indians,

• Recordings of programmes to be preserved for 90 days,

• Rs. 50 crore penalty for serious violations of programming code,

• Only 20 per cent foreign direct investment.

• Rs 10 crore initial deposit for 10-year license.

• Rs 40 crore bank guarantee

• 10 per cent Government shares in annual profits.

DTH service obviates the need for the friendly neighbourhood cable operator. What you get is what
you pay for. For an investment of around Rs. 12,000 on a decoder and a pizza-sized dish antenna, a
DTH subscriber will be able to receive global channels.

The Centre has, however, built in safeguards against the creation of broadcasting monopolies,
compromise of national security and distortion of public taste.
There is to be a 49 per cent cap on foreign equity in DTH service providers. Of this, up to 20 per cent
is to be foreign direct investment and the rest is to be foreign institutional investors, overseas
corporate bodies and non-resident Indian investments.

DTH is the first major step towards convergence but extra caution had been taken to ensure that no
vertical monopolies were created.

For security reasons, DTH players will have to beam from the home soil through earth stations within
the country. They will also have to adhere strictly to the advertisement and programme codes lay
down by the Ministry of Information & Broadcasting.

For similar reasons, the chief executive officer and a majority of directors of DTH companies would
have to be resident Indian citizens.

To obviate creation of monopolies, the share of existing broadcasting companies and cable network
owners would be restricted to 20 per cent in the DTH ventures. The new companies will also have to
keep the I&B Ministry informed about any changes in the equity pattern.

There will be no restriction on the number of DTH licences to be issued by the I&B Ministry for a 10-
year period.

While companies will have to furnish an initial deposit of Rs 10 crore, they will have to pay Rs. 40
crore as bank guarantee for the 10 year license period. At least 10 per cent of the total revenue
generated will have to be shared with the Government.

In case of violation of rules, apart from the threat of revocation of the licence, the errant companies
will have to shell out penalty to the tune of Rs. 50 crore. They will be required to preserve for at least
90 days, recordings of all programmes to be able to make those available for Government scrutiny.

Doordarshan could also provide DTH service but the final decision in the matter rested with Prasar
Bharati. Companies keen on using the technology for other services like fax and Internet will have to
obtain separate licenses. DTH service providers have to show Doordarshan channels on the must-
carry mode.

The Concept of CAS

CAS stands for conditional access system, which is a digital mode of transmitting TV channels
trough a set-top box (STB). The transmission signals are encrypted and viewers need to buy a set-
top box to receive and decrypt the signal. The STB is required to watch only pay channels, not free-
to-air channels, like Doordarshan. The best thing about it is that you need to pay for only those
channels you would like to watch.

In the new system, Indian broadcasting companies will decide which channels would be 'non-pay'
(free-to-air) and which would be 'pay'. The viewer will now be able to select the pay channels he
wishes to watch and pay for only these. Each broadcasting channel will determine the rates for
buying the channel.

Currently, there is no segregation and subscribers pay a blanket rate for the entire service. There will
soon be two levels of segregation. The first will be a broad differential according to lower, middle and
upper classes of society across cable households.

The second differential will be amongst pay channels, like premium channels, which will include
focused news, entertainment, sports, music channels and niche channels like nature, health and
fashion.

History of CAS in India

The idea of CAS was mooted in 2001, which was followed by a furore over charge hikes by channels
and subsequently cable operators. It was decided that it would be first introduced in the four metros.
It has been in place in Chennai since September 2003.

According to estimates, only 25 per cent of the people have subscribed the new technology. The rest
watch only free-to-air channels. The inhibiting factor is the cost of the STB. The set-top box is the
device that enables a subscriber view pay channels. This instrument decodes signals from the cable
operator for viewing a pay channel. It can also monitor the number and duration of channels viewed
by the subscriber.

Advantages of CAS

For viewers: Under, CAS viewers can watch only what they would like to watch, than what the cable
operator has on offer. Subscribers save money they now spend on unnecessary channels. They will
get better transmission (because of the use of optic fibre instead of metal cables). The cable
operators will no longer have any control over the pricing of channels.

For broadcasters: It benefits broadcasters as they always had to grapple with the issue of cable
operators not declaring the actual number of subscribers, and hence suffering losses. With CAS,
they can find out the exact number of subscribers with a cable operator.
For cable TV operators: They need to pay a part of the subscription fees to the broadcasters only for
the actual number of end users who opt for the channel. This allows operators to price their channels
according to their popularity.

For advertisers: It gives a far more accurate indicator of programme popularity with only the actual
subscribers of each channel being accounted for.

So why has there been opposition to CAS?

Consumer activists were essentially opposed to the high cost of the STB. If more people subscribe
to CAS nationwide, the prices would come down. There were also apprehensions about fees being
charged for the bouquet of channels instead of individual channels. The latest ruling from the
Telecom Regulatory Authority of India has struck down bouquet-wise pricing.

In simple terms, a person who wants to want only watch Star News, for example, will no longer have
to buy the Star bouquet, comprising, Star Movies, Star World, Star One etc.

Activists are also seeking a limit on the duration of advertising on air. Cable operators are opposed
to CAS because they become redundant and even if that didn't happen, they can no longer
understate the real number of subscribers and cheat the government of entertainment tax.

Service providers are opposed because they have to set up new digital machinery for CAS and may
even have to share the price of the STBs, to avert competition from direct-to-home transmission.

DTH versus CAS

DTH does not compete with CAS. Cable TV and DTH are two methods of delivery of television
content. CAS is integral to both the systems in delivering pay channels.

Cable TV is through cable networks and DTH is wireless, reaching direct to the consumer through a
small dish and a set-top box. Although the government has ensured that free-to-air channels on
cable are delivered to the consumer without a set-top box, DTH signals cannot be received without
the set-top box.

Besides, the monthly subscription cost for DTH and CAS on cable will vary. While you can opt for a
number of channels in CAS, under DTH you have a limited choice depending on the package you
opt for. The quality of the broadcast will be of high quality with big players in the fray.

DTH versus cable TV

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.

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.

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.

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. DTH will not be able to be an
alternative to cable if the initial investment is more than that for cable. DTH requires initial investment
for both a dish antenna and a TV-top box.

Present Players in the DTH Market

• Dish TV

• Tata Sky

• DD Direct Plus

Dish TV

Dishtv is India’s first direct to home entertainment service that has digitalized Indian entertainment to
bring to your home the best in television viewing through the latest in digital technology. It not only
broadcasts high quality programmes straight from the satellite to your home, but also gives you
absolute and complete control of what you watch and what you pay for. It is almost like having your
own satellite up in the sky.

The Story So Far

Dish TV added sony package to their aervices around mid of 2006 and also increase their
subscription price too . That really improved Dish TV customer numbers and services too. On 14
July 2006, the Telecom Disputes Settlement and Appellate Tribunal gave a favourable judgement for
Dish TV by ordering STAR TV to allow Dish to broadcast all the channels in its boutique at 50% cost
within 15 days of the decision.

After that Dish TV started test signals for the star bouquet and ended them at midnight, 18th of aug
and started to broadcast them as pay channels in Dish TV services . After the launch of TATA Sky
dth services in India, Dish TV also began to expand its value added services like Active channels,
E.P.G. (electronic program guide).For this, Dish TV is giving a S.T.B. software upgrade which will
change their menu options and support new services . The upgrade is currently provided to
customers free of cost and will finish at the end of the sep. 2006 . Dish TV currently has more than
165 T.V. channels and 35 audio channels counting sony and star bouquet .

Dish TV is the direct compititor from TATA sky and have huge base of more than 12,000,00
customers across India.

The Lineage

Dish TV is an Essel Group venture. Essel Group has a vast range of national and global business
interests that include media programming, broadcasting & distribution, packaging, entertainment,
online gaming and telecom, in close synergies with ventures active in the areas of content,
distribution and infrastructure.

Essel Group has always been a pioneer - Zee TV the first Indian satellite channel, Siticable the first
MSO, Esselworld the first theme park, Playwin the first online lottery, Essel Propack, which is the
world’s No. 1 in packaging - were all revolutionary concepts in their respective fields.

Continuing with the same path-breaking tradition, the group brought a new era of digital quality TV
viewing.

The Satellite Link

Dish TV uses NSS-6 to broadcast its programmes. NSS-6 was launched on 17th December, 2002
by European-based satellite provider, New Skies (one of the only four fixed satellite communications
companies with truly global satellite coverage)

Dish TV - India's first KU-band DTH entertainment service, hopped on to NSS-6 at from an INSAT
satellite in July 2004. The change in the satellite was to increase the channel offering as NSS 6
offered more transponder capacity.

LIST OF CHANNELS

CHANNEL PACKAGES AND LIST OF CHANNELS AVAILABLE ON DISH TV

• dish Welcome

Movies
Zee Cinema Max Star Gold Kids

Cartoon Network

Fashion Zee Trendz Fashion TV

Sports

ESPN Star Sports Zee Sports Ten Sports

News

Zee News Aaj Tak CNN Headlines Today Total TV BBC

Infotainment

Animal Planet Discovery National Geographic

Music Zee Music ETC Music B4U Music MTV Music MH1 Music Balle Balle

Religious Zee Jagran Aastha GOD TV Sanskar International TV5 Asia (French) Hindi Entertainment
Zee Smile Siti Channel Play TV Sab Star Utsav

English Entertainment ABC Asiapac Regional Entertainment ETC Punjabi ARY Digital India NE TV
N TV SS Music Jaya TV AsiaNet Akash Bangla ETV Marathi Kairali

dish Plus

English Movies HBO Zee Studio TCM PIX MGM Star Movies Music VH1 Trace TV Channel V

Kids Pogo Animax Nick Boomerang Toon Disney Disney Channel Hungama Infotainment The
History Channel

Entertainment Zoom Zone Reality AXN Zee Cafe Travel & Living Star World

dish Bioscope

Break - Free Hindi Movies Zee Premier Zee Action Zee Classic

dish News

Euro News Zee Business CNN Aawaz CNBC TV 18 NDTV 24X7 Star News Times Now
• dish Welcome Regional - complete your welcome bouquet by picking any one

dish Hindi/Punjabi Zee TV Sahara One Zee Punjabi ETV - Rajasthan ETV - UP ETV - Bihar ETV -
MP ETV - Urdu Geo TV Sahara Samay India TV NDTV India Sony Star One Star Plus

dish Gujarati Zee TV Zee Gujarati ETV - Gujarati Sahara One NDTV India Sahara Samay ETV -
Urdu Sony India TV Star One Star Plus

dish Oriya ETV - Oriya Zee TV Sahara One ETV - Urdu ETV - Bihar Nepal 1 NDTV India Sahara
Samay Sony India TV Star One Star Plus

dish Tamil/Malayalam Asianet News Jeevan TV Asianet Plus NDTV 24x7 ETV - Urdu Indiavision
Star Vijay Amrita TV

dish Bangla Zee Bangla ETV - Bangla Zee TV Zee Aakash Sahara One ETV - Bihar Nepal 1 NDTV
India Sahara Samay Sony India TV Star One Star Plus

dish Marathi Zee Marathi Zee TV Sahara One NDTV India Sahara Samay ETV - Urdu Sony India TV
Star One Star Plus

dish Telugu Zee Telugu ETV - Telugu MAA TV ETV - Urdu ETV2 Telugu News NDTV 24x7

dish Kannada ETV - Kannada Zee Kannada ETV - Urdu NDTV 24x7

Channels available as part of the Free-to-Air DD DTH Service

DD1 DD India DD News DD Sports DD Lok Sabha DD Rajya Sabha DD Kashir DD Punjabi DD
Bharathi

DD Sapthagiri DD Bangla DD North East DD Gujarati DD Sahyadri (Marathi) DD Oriya DD

Chandana (Kannada) DD Podigai (Tamil) DD Malayalam

DD Gyandarshan Aaj Tak Zee Smile Star Utsav Jain TV Headlines Today Zee Music MH1 Music

Akash Bangla ETV Marathi ETC Punjabi Kairali (Malayalam) TV 9 (Telugu) Sun TV Sun News »
Radio Channels Punjab Radio AIR VBS AIR Telugu AIR Marathi

AIR Tamil AIR Gujarati FM Rainbow Om Shanti

AIR Kannada AIR Bangla AIR Hindi RA ELP

AIR NE AIR Punjabi FM Gold RA FLP

TWO MORE CHANNELS ADDED VOYAGES AND BBC WORLD AS OF OCT 2006

Prices

The prices of the Dish TV connection were revised recently. As per the latest prices, for the Dish TV
connection, the initial investment including set-top box, all costs and taxes is Rs. 3600. For the
subscription, two packages are available, one for Rs. 225 per month and the other for Rs.374. The
latter includes premium channels.

Tata Sky

Tata Sky has revolutionised television viewing in India through its superior digital quality picture and
sound. The service aims to empower the Indian viewer with Choice, Control and Convenience
through its wide array of programming and interactive features. Tata Sky offers viewers a variety of
channels ranging from entertainment, sports, movies and music to news and documentaries in DVD
picture quality and CD quality sound.

Vision of Tata Sky

Tata Sky launched its Satellite Television service with top-of-the-line infrastructure. It aims to
revolutionise Indian entertainment by offering superior DVD quality picture and CD quality sound.
The service’s vision is to:

Inception and Heritage

Incorporated in 2004, Tata Sky is an 80:20 JV between TATA and STAR. Tata Sky endeavors to
offer Indian viewers a world-class television viewing experience through its Satellite Television
service.

The Sky Brand

The SKY brand, owned by the UK-based British Sky Broadcasting Group, brings to Tata Sky the
reputation of more than 20 years experience of satellite broadcasting. SKY is well known for the
innovative products and services launched by BSkyB, such as DTH broadcasting in 1989, digital
satellite broadcasting in 1998, interactive television services in 1999 and the SKY+ personal video
recorder in 2001. Tata Sky joins an international group of DTH businesses that includes platforms as
far apart as the UK and Italy in Europe, and Mexico and Brazil in Latin America.

The Tata Brand

The Tata Group is one of India's largest and most respected business conglomerates. It comprises
93 operating companies in seven business sectors: information systems and communications;
engineering; materials; services; energy; consumer products; and chemicals. The Tata Group has
operations in more than 40 countries across six continents, and its companies export products and
services to 140 nations. The Group and its enterprises have been steadfast and distinctive in their
adherence to business ethics and their commitment to corporate social responsibility. This is a
legacy that has earned the Group the trust of many millions of stakeholders in a measure few
business houses anywhere in the world can match.

Extensive Service Network

Tata Sky has established an extensive customer service network across the country. It has engaged
a field force of approximately 3000 service engineers, who are complemented by high-end 24x7 call
centers, manned by multi-lingual customer service associates, trained to solve all customer
problems.

Tata Sky takes direct responsibility for hardware installation at subscribers’ homes, as well as for
providing after-sales service.

Tata Sky also retails its hardware and prepaid recharge vouchers through popular consumer
electronic stores to enhance customer convenience.

Business Partners

Tata Sky has invested in state-of-the-art digital infrastructure and has partnered with global leaders
in digital technology for the pay television market.

Indian Space Research Organisation (Satellite):

The company has on lease all 12 KU-Band transponders on ISRO's Indian satellite, INSAT 4A, the
most advanced and high-powered KU-Band communication satellite in the region. The satellite
enables Tata Sky to offer superior picture and sound quality with a wider range of channels.

Business Support Software:

NDS: Tata Sky has partnered with NDS, the leading provider of technology solutions for pay
television. NDS systems has played a key role in the end-to-end system architecture and launching
the nationwide digital service. The NDS VideoGuard conditional access solution provides superior
broadcast security, and enables Tata Sky to offer multiple programming and pricing packages.
Siebel: Tata Sky has selected Siebel, leaders in Customer Relationship Management (CRM)
software, to support operations across the areas of call centre and field service operations, customer
order management and product configuration.

Kenan: Comverse’s Kenan FX billing software has been selected to support billing for all residential,
institutional and commercial customers. The Kenan software has been enhanced specifically for
Tata Sky, to support a first in industry pre-paid billing capability which will provide customers with the
ability to pay as you go.

SAP: SAP the leading Enterprise Resource Planning (ERP) application suite, has been selected by
Tata Sky to support the company’s materials management, sales and distribution, finance and
control and human resources requirements.

IT: Sun Microystems: Tata Sky has selected Sun Microsystems to provide world-class technology
infrastructure, which helps the company to deliver highlevel service standards for its Satellite
Television service. The servers ensure maximum up-time, fault recovery and load management. Sun
has also provided Tata Sky with installation, engineering expertise and support.

Digicomp: Tata Sky has partnered with Thomson and Humax, world leaders in digital broadcast
terminology, for building top-of-the line digicomps, customized specifically for the Indian markets.
The technology’s feature rich design will enable Tata Sky to deliver multiple programming, pricing
packages and interactive services to its customers.

How Tata Sky DTH works

Tata Sky uplinks channels to its satellite that transmits digital signals directly to a minidish fixed on
the subscriber's balcony, terrace or outside the window. The minidish relays the signals to Digicomp
that decrypts and relays them to the television. A large building with multiple inhabitants can use a
single minidish with individual digicomps at each home.

Entertainment

Tata Sky's satellite service brings home a whole new entertainment experience with its direct-to-
home (DTH) television service. Subscribers can now choose from a variety of popular and new
channels and enjoy interactive features. Some of the highlights of the service are:

Entertainment and media channels

Tata Sky offers subscribers popular channels such as STAR group channels, Sony, Discovery,
Disney, MTV, NDTV, ESPN STAR Sports, National Geographic, Eenadu, TV Today, Asianet and
many more.

Digital-quality service

The service provides viewers with DVD-quality picture and CD-quality sound, enhancing their
viewing experience.

Television goes interactive

Ever thought of playing interactive games on your television? Or getting weekly channel schedules
right on the TV screen with synopses of programmes? Interactive features on Tata Sky make all this
and more possible. Features like Actve STAR News, Actve Newsroom and Actve Khabar allow
viewing multiple channels on a single screen. For kids there is a special Actve Wizkids learning
service. With parental control functions it's also easy to lock channels with special PIN numbers.

Customer service and infrastructure support

Tata Sky has set up a pan-India distribution network of popular consumer electronic stores and
mobile phone outlets that retail its hardware and prepaid recharge vouchers. The company has also
tied up with LG, ITC International Business Division and Indian Oil Corporation to support its
distribution network.

Tata Sky undertakes installation and servicing of hardware at subscribers' homes, ensuring high
levels of customer service. The company has engaged a field force of qualified professionals
complemented by multi-lingual customer service associates adequately trained to solve all customer
problems.

Distinguishing features

Some of the attributes, which will distinguish Tata Sky from other players in the market, are related
to its pedigree that culminates into two of India's biggest brand names. The TATA group is one of the
most trusted corporate houses of the country. On the other hand, STAR has been the leading
entertainer in India for many years now. Add to that, Tata Sky leverages STAR's parent company,
BSkyB's experience in the pay television market. BSkyB operates several pay television platforms
including Foxtel, Sky New Zealand, and Sky Italia across the world.

Secondly, customer service is a key factor that will distinguish Tata Sky from other pay television
platforms. Tata Sky will be directly responsible for installing and servicing the hardware at every
subscriber's home, thereby ensuring the highest levels of customer service. The company has
engaged a field force of about 3,000 people who will be complemented by a high-end 24x7 call
centre, manned by multi-lingual customer service associates, trained to solve all customer problems.

Tata Sky will offer subscribers a wide range of interactive programming choices and interactive
features. Channels on the platform will range from sports and general entertainment to news and
lifestyle. The service has been designed to give subscribers a choice of all their favorite television
channels in DVD quality picture and CD quality sound. In addition, subscribers can now control the
way they watch television through a host of interactive services such as an on-screen program
guide, Actve Sports, Actve STAR News, Actve Newsroom, and Actve Khabar. Such innovative
applications are not available on other platforms.

Channels Offered

Prices

Tata Sky charges Rs. 4550 for the Set Top Box, plus installation, plus activation, plus one year
comprehensive warranty, plus all the taxes. This amount also includes three months subscription
charges. After that, the subscriber has to pay Rs. 200 per month for the subscription.

DD Direct Plus

What is DD DIRECT+ ?

Doordarshan, the national broadcaster in India, at present has a network of more than 1400
transmitters spread throughout the country and its signals are available to about 90 %( DD1) and
43% (DD-News) population of country. The prime duty of any national public service broadcaster is
to make the programmes of national importance available to all its people and nationals. It was
estimated that the coverage of remaining 10 % population with terrestrial (single channel) broadcast
would cost enormously. Besides that, setting up of terrestrial transmitters in the uncovered areas
would have taken a number of years (10 to 15 years). Also, operation of terrestrial transmission
would have required a huge manpower (a few thousand persons).

With the fast developments taking place in Satellite Broadcasting, it is but natural that Doordarshan
has also come up with an alternative to get the required reach with an alternate technology option
“Ku-band broadcasting” which is envisaged for the coverage of remaining population. This is a much
cheaper and economical option as compared to the coverage through Terrestrial transmitters.

Ku-band transmission will provide coverage in all uncovered areas including remote, border, tribal,
hilly and inaccessible areas in one go within a short time. With this coverage, the national
broadcaster proposes to meet its obligation of covering the whole nation and its people not only with
national channels, but also make available popular Doordarshan and some other free-to-air
channels on its platform. In order to meet its obligations, it has also been decided that 10,000
receive systems (Dish and Set Top Box) would be provided free of cost at public institutions like
Anganwadis, Schools, Public Health Centres, Panchayats, Youth Clubs, Cooperative Societies etc.
in the uncovered areas.

Doordarshan has started DTH service with Ku band broadcasting as not only uncovered areas are
covered with its commencement, but also the whole country gets multi-channel service in one
stroke. The signal will be available at each home directly without the use of any cable etc. and one
will be able to receive the programmes with the help of a small receive segment.

The DD DIRECT+ envisages telecast of 38 free-to-air channels (containing both Doordarshan and
private channels) initially and is likely to include more channels later on. Satellite Earth Station for
uplink of signals has been setup at Delhi. Test transmission has already commenced and the
commissioning of the service would take place shortly. NSS 6 is the high power Ku-band satellite
hosting the DD DTH services. The free distribution of the receive systems is also being expeditiously
done.

The ‘DD Direct Plus’ launched on 16th December, 2004, India’s first Free DTH service offering 33
TV channels and 12 radio channels, continues to gain in strength. Its all India subscriber base is
approximately 4.5 lakhs sets.

Action is underway to increase the number of TV channels in DD Direct Plus from 33 to 50.

List of Channels under DD Direct Plus Bouquet:

DD Channels

DD National

DD News

DD Sports

DD Bharati

DD India

DD Lok Sabha
DD Rajya Sabha

DD Malayalam

DD Bengali

DD Oriya

DD Gujarati

DD Punjabi

DD North East

DD Podhigai (Tamil)

DD Saptagiri (Telugu)

DD Chandana (Kannada)

DD Sahyadri (Marathi)

DD Kashir (Kashmiri)

Educational Channel

Gyan Darshan

Private Channel

Aaj Tak

Headlines Today

BBC World

Jain TV

STAR Utsav

Zee Music

Smile TV
Kairali TV

Akash Bangla

ETC Punjabi

MH-1

ETV-Marathi

TV-9

SUN TV Radio Channels

AIR Hindi

AIR Bengali

AIR Telugu

AIR Marathi

AIR Tamil

AIR Punjabi

AIR Gujarati

AIR Kannada

AIR North East Service

Vividh Bharati

FM Gold (Delhi)

FM Rainbow(Delhi)

How DD DIRECT+ is different from other DTH systems?

Most of the DTH Systems, operating all over the world, provide Paid Service. The encrypted TV
signals are received from the satellite on the Dish Antenna and transmitted to the DIGITAL
DECODER. The customer is provided with a Viewing Card, which is inserted into a slot in the
DIGITAL DECODER. The Viewing Card decrypts the TV signals chosen & paid for by the customer.
A Viewing Card is a credit card sized smart card, which contains information about the channels that
the customer has subscribed to. When inserted in the Decoder it enables viewing of the channels
chosen by the subscriber. The subscription charges for viewing these channels are collected by the
DTH operator.

However, DD DIRECT+ is totally different, as Doordarshan is not charging any subscription fee from
the viewers, making the system cheap and affordable for all.

Receive system of DD DIRECT+ is cheaper as compared to receive system of other DTH operators
as all the channels proposed under Doordarshan project are Free-To-Air and therefore SMS and
CAS are not envisaged. No smart card/conditional access system is required at the uplinking or
downlinking site.

Prices

Investment on the part of subscriber for receiving DD-DIRECT signal is only one time on receive
system and no recurring monthly expenditure will have to be incurred by the viewer. As compared to
other DTH systems, where a huge activation fee and a monthly subscription fee is charged, the DD
DIRECT+ can be received without payment of any activation fees. Price at which DD introduced the
receive system was less than Rs 3000/-And since the technology has got induced and the demand
for the receive systems has increased the prices have comedown. The current rates at which the
receive system is available these days is Rs. 1500.

UPCOMING PLAYERS IN THE MARKET

The direct-to-home (DTH) space is getting hotter. The Anil Ambani-controlled Reliance ADA Group
has got the letter of intent (LoI) from the government for starting DTH broadcasting service in the
country.

The company is expected to roll out the service within six to eight months. Of late, there have been
industry concerns over lack of space on satellites for starting DTH services. For instance, Reliance
group’s DTH is expected to start with six transponders and increase to 18 over a period of time.
Indian Space Research Organisation (ISRO) has plans to add around 36 Ku-band transponders,
which are essential for DTH.

Although the Reliance group is calling its DTH service ‘Blue Magic’ now, its earlier name had
triggered a controversy. The group had earlier named the DTH project ‘Sky Magic’, reacting to which
UK’s BSkyB had sent a notice to Reliance. BSkyB claimed all rights to the trademark ‘Sky’. The
Rupert Murdoch-run BSkyB has a successful DTH operation in the UK. Subsequently, Reliance
changed the name of its DTH venture. Meanwhile, Reliance-ADAG's entry into DTH is seen as the
group's strategy to include the entire range of delivery systems through which content can be
delivered to customers.

The Chennai-based Sun TV also has strong DTH plans. Sun, too, is expected to start its service
over the next few months. Very little information is available on Sun’s proposed DTH service, though
it is estimated that Kalanithi Maran might come up with a DTH platform that is looking at bunching all
the South Indian language channels together.

PRESS RELEASES

Reliance Gets Go Ahead for DTH

12 sep 06

Anil Ambani's Reliance-ADAG has reportedly received the letter of intent (LoI) from the Ministry of
Information and Broadcasting (I&B) to foray into the direct-to-home (DTH) broadcasting service in
the country.

Reliance Communications, however, declined to comment on this development. The government

has reportedly asked the company to complete formalities, including bank guarantee and license
fee.

The company will now submit fees for the license, which it expects to procure within four to six
weeks. Subsequently, the service will be launched within six to eight months.

Reliance-ADAG had applied for license to enter DTH services about a year ago when the two
Ambani brothers reached a settlement on the issue of ownership of the Reliance Group.

The service will be called "Reliance Blue Magic," and Reliance will be the fifth operator to enter the
DTH arena after Zee Group's Dish TV, Star TV and Tatas' Tata Sky, Prasar Bharati's DD Direct
Plus, and Kalanidhi Maran-promoted Sun TV.

Meanwhile, Reliance-ADAG's entry into DTH is seen as the group's strategy to include the entire
range of delivery systems through which content can be delivered to customers.

Reddy briefs parliamentary committee on DD Direct Plus

(21 December 2004 9:30 pm)

NEW DELHI: Some Indian policy makers today took note of the modern technology involved in
broadcasting and suggested set-top boxes should be cost-effective for Doordarshan's KU-band DTH
television service to be successful.

Members of Parliament of the Consultative Committee attached to the information and broadcasting
ministry today were briefed by minister Jaipal Reddy on DD Direct Plus.

While assuring the panel members that all precautions would be taken in terms of content as DD
Direct Plus is not an encrypted DTH service, Reddy said they would be provided all related
information so the subject can be studied thoroughly by them.

The members were informed that satellite earth station for uplinking the KU-band service has been
set up at Todapur in Delhi and that DD has leased four transponders on NSS-6 satellite for beaming
this service to those areas especially where cable and terrestrial TV have failed to make an impact.
According to the minister, DD has already installed 5,700 dish antennas in the identified states,
including the hilly terrain of northeastern part of the country.

On the occasion, Prasar Bharati made a presentation before the consultative committee members
on the DTH service.

Those who attended the meeting included cine star-turned-politician Dharmendra, Usha Verma, Kirip
Chaliha, Sudhakar Reddy, media baron Vijay Darda, Nirmala Deshpande and Hannan Mollah.

Can Star power say Tata to Zee's Dish, DD?

By ANJAN MITRA

(Posted on 10 March 2004)

The Rupert Murdoch-controlled Star Group has always been bullish on DTH in India. In 1997, the
bullishness had got them into trouble as the then government had banned reception of KU-band
signals (over 4800 MHz) just to spite Star India that was bombarding the media with information on
its DTH plans.

The situation has undergone a change in the sense that this time round. Star has kept a low profile
on its proposed DTH venture. Rather, the media has almost been blocked off on information on its
DTH forays or prospective Indian partners. But the business eagerness still remains. It is apparent in

what Star Group's new CEO Michelle Guthrie, who took over from James Murdoch last November,
feels about the potential of DTH in India.
Star Group's CEO Michelle Guthrie

In an interview given to the Hong Kong-based Television Asia magazine, Gutherie said that Star's
Indian DTH platform is a priority, as is "getting paid for the subs (subscribers) we aren't getting paid
for."

Attempts by indiantelevision.com to elicit an official response from either majority partner (80 per
cent) the Tata Group or Star itself as to what is being served up on the DTH plate have drawn a
blank thus far. However, informed sources have provided some details as to just what's cooking.

DIFFERENT PRICING FOR DIFFERENT REGIONS

Pricing is what can make or break a service provider in a market as sensitive as India and this is an
issue that is getting a lot of attention.

A customer who takes the full DTH offering of 80 channels is likely to end up paying Rs 400 on an
average. As far as the total hardware for installing DTH is concerned, it would be just under Rs
5,000, the sources say. This includes installation costs as well. There is no indication, as of now, that
the box is going to be given away free, which was the route Murdoch took for BSkyB in the UK.

Current indications are also that the Star-Tata DTH packages will not be uniformly priced but will
vary from region to region. While in South India, the basic tier is expected to cost around Rs 200,
this may not be the price a customer pays for the same tier in another region. This is because Tata-
Star expect different levels of penetration in different areas.

In Mumbai for instance, even though demand is expected to be high, there are technical problems
that are likely inhibit penetration. The biggest stumbling block being the highly congested layout of
Mumbai. With most buildings and colonies in the metropolis stacked up "cheek-by-jowl", it is no
straightforward task to position a potential customer's DTH dish antenna where it can receive signals
without obstruction. Except for the really upmarket localities in the city, most areas are likely to face
such difficulties.

One point indiantelevision.com is still unclear about, is whether the proposed DTH service would be
launched under the brand name of Space TV, the company that had earlier applied for a license and
had also managed to obtain a letter of intent from the Indian government, despite several question
marks against the company's shareholding pattern that flouted the guidelines.

There is also no official communication available whether the new 80:20 joint venture has paid the
Rs 100 million bank guarantee, as stipulated in the DTH guidelines, to the government though the
buzz in the information and
broadcasting ministry indicates that this has been done. All that was forthcoming from the Tatas, the
majority shareholder in the DTH venture, was that "when there is something to be communicated
officially, the media would be intimated about it." Similar is the stand that Star is taking as well.

5 MILLION SUBSCRIBERS WITHIN 10 YEARS

According to Star's projections, when a business proposal was made over 18 months back, the
target would be to acquire about five million subscribers in about a decade's time.

This plan may undergo some change considering that some in the company now believe that the
growth in the number of DTH subscribers in India may be faster than other places where DTH is a
fairly established service.

Why? A DTH service in India may outstrip conservative estimates because of the lack of digital
terrestrial service in India and seemingly plateauing off of cable TV's growth in Asia-pacific, including
India.

Though MPA estimates that in India a DTH service would manage to acquire approximately seven
million subscribers in 10 years' time, a senior Star executive, on condition of anonymity, hinted that if
properly marketed, a subscriber base of 10 million could be targeted in five years time. Do the Tatas
agree? The group is said to be still firming up its numbers on DTH.

A typical DTH operation is estimated to cost between $ 400-500 million, but, according to information
available, the Indian DTH project has been calculated to cost between $250-$300 million by Star.
The project's business angles are said to have been vetted by Ernst & Young for the Tatas.

Again, according to information available, the debt-equity ratio of the DTH venture is likely to be 1:1,
which may change a little when the project actually gets off the ground. The paid-up capital of the
DTH joint venture would be approximately Rs 8 billion.

The service was slated to be launched by Christmas time by the Tata-Star combine. But now with
CAS being put off by the government, on recommendations from the broadcast and cable regulator,
Trai, the duo look to be thinking of advancing the launch date. To even before Diwali, some say.

It would help Star to tap additional subscription revenue and also take advantage of the part
conditioning of people in the metros at least for paying for watching TV channels.

Where Star-Tata combine has an advantage is that the DTH project can draw on the experience of
BSkyB to go in for unique and more effective marketing of the service like subsidizing of set-top
boxes heavily.
Dwelling on the drivers for a DTH service, MPA's Couto points out that aggressive subscriber
acquisition is driven by STB subsidies (partial or in BSkyB's case full subsidy); premium and
differentiated content (sometimes exclusive such as Premier League Soccer on Sky in the UK),
intelligent packaging and tiering (simple but gives people a lot of choice and makes it affordable);
customer service and marketing and, of course, deep pockets and the ability to absorb long term
cash flow losses. "Two billion pounds were invested in BSkyB, for instance," he adds.

Yes, it's the financial muscle of Murdoch and the Tatas that can give a tough time to Chandra and
his Dish TV. But it would be interesting to see which of the three players manage to beam more
direct and easily into Indian consumers' homes.

PRIMARY RESEARCH

QUALITATIVE ANALYSIS

DEPTH INTERVIEWS

We went to various authorized dealers and retailers in different parts of the city and with varying
years of experience in the business of mobile phones. Slight variations were visible in the inputs we
received from them, but in general we could identify certain major trends in the quality demand,
features and other factors related to mobile phones. In all, we interviewed 10 dealers. They were:

• Mr. Deepak Gupta, Director Sales, H.R. Electronics, Lajpat Rai Market, Chandni Chowk, Delhi

• Mr. Gaurav, Gujral Electronics, Lajpat Rai Market, Chandni Chowk, Delhi

• Mr. Anand Mohan, Jagdamba Electronics, Lajpat Rai Market, Chandni Chowk, Delhi

• Mr. Sumit Gupta, Vinky Electronics, Lajpat Rai Market, Chandni Chowk, Delhi

• Mr. Sarvajeet Kohli, Eveready House, Lajpat Rai Market, Chandni Chowk, Delhi

• Mr. N.L Nagdev, DTH World, Bhagirath Palace, Delhi

• Mr. Hari, C-net Communications, Mayapuri Industrial Area, Delhi

• Mr. Khushinder, Modern Electronics Industries, Naraina Industrial Area, Phase-1, delhi

• Mr. Rajesh Agarwal , Parko Eletronics, , Lajpat Rai Market, Chandni Chowk, Delhi

• Mr. Sanjay Mehta, Auto Voice India Pvt Ltd., , Lajpat Rai Market, Chandni Chowk, Delhi
Following are the summarized findings from the interviews-

Q1. Who all are the major DTH service providers?

Ans. In all, there are 3 DTH providers now- Dish TV, DD Direct Plus and Tata SKY. However, we
can expect to see new players in the market like Reliance, MTNL in the near future.

Q2. What are the additional services provided in DTH over Cable TV and who all are providing those
services?

Ans. There are various additional services provided in DTH over Cable TV. DTH provides superior
Audio and Video Quality. There are various other services like large no. of channels, on demand
movies, wide variety of games, parental lock and messages about balance and other schemes by
the service providers. Dish TV and Tata Sky provide all these services. However, DD Direct doesn’t
provide features like paid channels, on-demand movies.

Q3. What are the prices and initial investment for accessing the services of different service
providers?

Ans. The initial investment required for DD Direct Plus is about Rs.1300 and since it provides all
free-to-air channels, there is no monthly rental for accessing the services. The initial investments for
a Dish TV connection and a Tata Sky are Rs 3600 and Rs. 4550 respectively which include the cost
of the set-top box and the antenna, the installation charges and a three month rental. The monthly
rental for all the free-to air and most common paid channels for Dish TV is Rs. 225(incl. taxes). The
package for additional paid channels is Rs, 374/ month. In Tata Sky, there is only one package
which costs Rs. 200 (incl taxes) for free-to air and paid channels.

Q4. How has been the customer reaction to DTH so far? Has been there any interest shown by
customers towards DTH?

Ans. The interest shown by customers towards DTH has been increasing over the past month.
Earlier, when there were only Dish TV and DD Direct Plus, the customers weren’t very enthusiastic
about this new concept. But due to the entry of Tata into this market has lead to heavy
advertisements and promotional activities by the service providers. So, we have seen a definite
increase in the no. of queries flooding in for DTH.

Q5. Which Provider has evoked a more enthusiastic response from consumers so far?

Ans. The response to DD Direct has been lukewarm in urban market. On a whole, in terms of
queries and general consumer feedback, the response to Tata Sky has been far more positive.
Q6. Have been there any problems from customers vis-à-vis quality or signaling feedback?

Ans. No, except two-three cases of some problems in set-top boxes there haven’t been any major
objections from customers.

Q7. How has been the customer’s feedback with regards to after-sales services provided by these
services?

Ans. Customer Care services by Tata Sky have been more speedier and effective, as told by
customers, with a time lag of 12-24 hours. However, for Dish TV, the time lag is on an average 48
hours.

Q8. How well are the customers informed about the different brands and features available in the
market?

Ans. We have had totally diverse kinds of customers visiting us. Some of them aren’t at all aware of
the concept and ask for very general queries. On the other hand, we also get customers who are
very informed and seek details of any new schemes on offer by the service providers. On the whole,
the customers generally look for guidance in choosing a service provider due to very little differences
between the rival packages on offer.

We interviewed the following Sales Executives and other company personnel of various DTH
providers:

• Mr. Abhishek Bhattacharya, Sales Head, NCR, Dish TV

• Mr. Gaurav Khanna, Sales Executive, East Delhi, Dish TV

• Ms. Smiley, Sales Executive, North Delhi, Tata Sky

• Mr. Vijay Nayyar, Overall Distributor, Dish TV, North Delhi.

From the above interviews, we found that both Dish TV and Tata Sky are very optimistic about the
growing business opportunity in India. Both felt that the increasing competition in this sector has lead
to an increase in consumer interest about DTH and both the service providers expressed their
confidence on being the market leader in the coming 12 months. Both the service providers claimed
that despite being a new technology, this model is likely to succeed in India at a rapid speed
because of numerous benefits on offer.

While Dish TV said that it was looking for television and print media to carry forward its promotional
activities, Tata Sky said that it had been focusing on strengthening its distribution network through
strategic alliances with major distributors and other big players nationwide like ITC’s e-choupal and
Reliance Retail.

Both the companies claimed that they were not perturbed by the possible entry of Reliance in the
market and were keen to take on the latter, which is known for its aggressive marketing and pricing
strategies

Both the players said that they are very keen on strengthening the distribution channel and are
working very intensely towards it. They are focusing on giving reasonable margins to dealers,
focusing on advertisement and promotional support via hoardings and circulating brochures and
other promotional material among the dealers

OBSERVATION METHOD

Apart from depth interviews from the dealers, we also used the observation method to understand
the consumer’s perception and purchase behavior about DTH when they visited the dealers for
purchase/queries.

The customers showed particularly keen interest towards Dish TV and Tata Sky, and weren’t too
enthusiastic about DD Direct Plus. Most of the customer queries were pertaining to comparison on
parameters like video and audio transmission and charges and were shown the different brochures1
and other materials of the service providers. The customers were also keen to enquire about after
sales services by the DTH providers. Due to very less differentiation being offered in the services
and prices charged by the rivals, Dish TV and Tata Sky, the customers often asked for guidance and
other information from the dealers.

Although the dealers were marketing the equipment of all the three DTH providers, we could easily
see a bend towards Tata Sky as the dealers went on with their comparison to the customers. This
could be attributed to the fact that Tata Sky may be offering higher margins and other promotional
support to the intermediaries.

The dealers were answering to every customer query in great depth and often showed product
demos and other demonstrations. Since DTH is a new revolution in the ever growing Indian
television industry, the role of the intermediaries in this segment is very significant. All the service
providers must take this factor into account and focus on strengthening the distribution network,
apart from continuing on other promotional avenues.

QUANTITATIVE ANALYSIS
SAMPLE DESCRIPTION

The following is a general description of our sample of 250 respondents that were surveyed by us.

OWNERSHIP COMPOSITION

TRANSMISSION SERVICE NUMBER OF RESPONDENTS PERCENTAGE

CABLE 206 82

DTH 23 10

BOTH 13 5

NONE 8 3

250 100

From the survey undertaken we analyze that around 85-90% of the Indian population owns CABLE
TV. Although most of the people are CABLE TV users but now people are preferring DTH over
CABLE TV due to its additional features and affordable cost.

As a result the percentage of DTH users has become around 15% in a short span of 2 years even
when it is rivaled against the well-established CABLE TV.

RESULTS AND FINDINGS

SATISFACTION FROM CABLE SERVICE PROVIDERS WITH RESPECT TO THE FOLLOWING

ASPECTS:

TRANSMISSION PERCENTAGE

VS 46 18

SS 145 58

CS 19 8

SD 25 10

VD 15 6

250 100
We had surveyed a sample of 250 units. From the survey we found out that there are only 75% of
the respondents who are CABLE TV users are satisfied with its transmission quality.

Cable service is not as smooth as that of DTH. The transmission gets disconnected in between quite
a number of times as compared to DTH which provides an interrupted, clear and 24*7 transmission.

VIDEO QUALITY PERCENTAGE

VS 56 22

SS 132 53

CS 22 9

SD 26 10

VD 14 6

250 100

From the sample undertaken for our market research study only 75% of the respondents who are
CABLE TV users, are satisfied with its video quality.

Since dealers have lesser margins in providing CABLE service thus, they divide channels in the
maximum possible denominations to capture the maximum market possible but this in turn leads to
degradation of the video quality of the service.

However, DTH has proved that it provides incomparably better quality than CABLE TV.

AUDIO QUALITY PERCENTAGE

VS 73 29

SS 112 45

CS 31 12

SD 27 11

VD 7 7

250 100
Out of all the respondents we tracked around 75% of them who are CABLE TV users are satisfied
with its audio quality.

However, many a times the sound service is not up to the mark as it starts breaking or become
distorted.

Also, at times there is cross linking of channels due to which dialogues of one channel are audible at
the others too.

CHARGES PERCENTAGE

VS 46 18

SS 71 29

CS 49 20

SD 56 22

VD 28 11

250 100

from the bunch of 250 respondents who were asked to fill the questionnaires only half of them that is
i.e.45-50% of the CABLE TV users are satisfied with the amount they are charged for the service
whereas, 30-35% are not happy paying the current prevalent price.

When asked the reason they pointed out that it is not worth it as many a times distortion creeps in
and digital quality of all the channels is not uniform i.e. the digital quality of channels except of the
popular and most sought out channels is not standard.

CHANNELS PROVIDED PERCENTAGE

VS 55 22

SS 93 36

CS 29 12

SD 44 18

VD 29 12
250 100

Out of the sample surveyed only 60% of the respondents who are using CABLE TV currently are
satisfied with the number of channels it provides.

Whereas 30% of the respondents who are currently CABLE TV users are not comfortable with the
number of channels provided.

DTH provides various channel packages which are customized in every brand. For e.g. TATA SKY
provides around 110 channels and has only 1 package. Similarly DISH TV also provides most of the
pay channels. However, DD DIRECT PLUS has a package of only the free to air that is 38 channels.

CUSTOMER CARE PERCENTAGE

VS 31 12

SS 54 22

CS 46 18

SD 61 25

VD 58 23

250 100

We surveyed 250 people and out of those only 40% of the respondents who are currently CABLE TV
users are satisfied with its customer service.

Whereas around 50% are not appreciative about its handling of the customer care services.

DTH users are happier in this aspect as the customer care services provided with these are very
efficient and easily available. Out of all the DTH service providers TATA SKY is said to have the
most efficient customer care services, which are also free of cost for the warranty period.

UNAIDED RECALL OF THE VARIOUS DTH PROVIDERS BY THE RESPONDENTS

TRANSMISSION SERVICES NUMBER OF RESPONDENTS PERCENTAGE

DD DIRECT PLUS 45 70

DISH TV 175 55
TATA SKY 138 18

RELIANCE 10 4

Out of 250 people who contributed to conduct this market research study, maximum number of
people constituting 70% of the population are aware about TATA SKY DTH provider, around 55% of
the respondents could recall DISH TV, 18% were aware about DD DIRECT PLUS and only 4% knew
about the RELIANCE DTH service.

TATA SKY and DISH TV conduct marketing on extensive level and thus most of the people are
aware about these two brands whereas DD DIRECT PLUS lags behind due to negligible marketing.

SOURCE OF AWARENESS OF DTH SERVICE PROVIDERS

SOURCE OF AWARENESS NUMBER OF RESPONDENTS PERCENTAGE

TELEVISION 132 53

NEWSPAPER 56 22

FRIENDS 29 12

HOARDINGS 13 5

INTERNET 10 4

ANY OTHER 10 4

250 100

From the study we can say that maximum number of people came to know about DTH service
through television, secondly through newspapers, thirdly by friends, then by hoardings and lastly
internet.

RANKING OF ATTRIBUTES ASSOCIATED WITH TELEVISION ENTERTAINMENT

Attributes Points Rank

Digital Quality Service 633 1

Number of Channels 675 2

Charges 738 3
Movies on Demand 802 4

Multi Language Interface 1197 5

Gaming 1200 6

In terms of preference of attributes associated with Television Entertainment, Digital quality service
is clearly the most preffered one closely followed by Number of channels on offer.

Charges of the connection are ranked 3rd overall.

The customers prefer Movies on Demand to Gaming & Multi Language Interface which are raked 5th
and sixth respectively.

So, DTH service providers must emphasize on Digital Quality Service & Number of Channels offered
while positioning their brands in a highly promising market for them.

WILL DTH TV REPLACE CABLE TV?

Yes 169 (68%)

No 81 (32%)

All the 250 respondents who were made to fill the questionnaire were asked to answer the last
question, “Will DTH TV replace Cable TV?”

2/3rd of the respondents i.e. 68% respondents were confident that DTH TV can completely replace
Cable TV. The various schemes offered by the DTH providers are now attracting cable TV owners,
and in future, more such schemes may directly affect Cable TV.

1/3rd of respondents i.e. 32% of respondents said that no matter what happens, Cable TV has ruled
for over 15 years, and completely replacing Cable TV with DTH TV is impossible because of various
reasons. Some reasons can be convenience, perception, ignorance etc.

SECTION-A- FOR NON-DTH USERS

All the questions in this section were asked from the non-DTH users.

PEOPLE PLANNING TO BUY A DTH CONNECTION

Decision maker 0-15 15-25 25-40 above 40 Total

Respondent 0 33 9 5 47

spouse 0 0 5 4 9

father 2 32 3 1 38

mother 0 3 0 0 3

brother/sister 0 4 1 0 5

children 0 0 0 4 4

Total 2 72 18 14 106

Of all the 250 respondents from which we got the questionnaires filled, 216 didn’t have a DTH
connection. Of these, 106 said that they were planning to buy a DTH connection in future. The 2
respondents from 0-15 age group who were keen on buying a DTH connection, said that the
purchase decision would be taken by their father.

72 respondents from the 15-25 age group were keen on buying a DTH connection and the purchase
decision in their families is reported to be dependent on either them or their father.

In the case of 25-40 and above 40 age group, the purchase decision is to be taken either by the
respondents or their respective spouses.

WHAT INITIAL INVESTMENT ARE YOU WILLING TO MAKE FOR DTH CONNECTION?

Particulars Frequency Percentage

Less than 1000 84 39

2001-3000 108 50

3001-5000 21 10

5000 and above 3 1

216 100

Out of the 250 respondents who filled the questionnaire, 216 respondents did not own a DTH
connection. These 216 respondents were asked about the Initial Investment they were comfortable
making, for a DTH connection.
50 % of the correspondents were willing to shed Rs. 2000 to Rs. 3000 as the initial payment of the
set top box and dish antenna.

39 % of the respondents preferred to pay an amount lesser than Rs. 1000 for the same.

10 % respondents did not mind paying an amount between Rs. 3000 and Rs. 5000 for the
equipment.

1% of respondents said that if the DTH providers provided an uninterrupted service even during
rains and other weather disturbances, even an amount exceeding Rs. 5000 was worth paying.
These people were those who did not mind compromising on price but wanted quality.

WHAT PER MONTH CHARGES ARE YOU WILLING TO PAY FOR DTH CONNECTION?

Particulars Frequency Percentage

Less than 200 134 61

201-300 76 35

301-400 8 4

400 and above 0 0

216 100

The 216 respondents who did not own the DTH connection were also asked about the per month
charges they were willing to pay for a DTH connection.

Analyzing the responses received, a majority of respondents, 60 %, would be happy paying less
than Rs. 200 per month for DTH connection.

35 % respondents were comfortable paying charges between Rs. 200 and Rs. 300.

Only 4 % respondents said that id quality of service was high, they had no issues, paying a per
month charge between Rs 300 and Rs. 400.

No respondent was willing to pay a charge in access of Rs. 400 under any circumstance.

They said that even if they could see an enormous number of channels for that amount, it was not
worth paying anything above Rs. 400.
SECTION B- FOR DTH USERS

All questions in this section were asked from DTH users only

WHICH DTH CONNECTION DO YOU OWN?

Particulars Frequency Percentage

Dish TV 12 35

Tata Sky 18 53

DD Direct Plus 4 12

34 100

Out of the 250 respondents who were made to fill the questionnaires, only 34 respondents currently
owned a DTH connection.

Out of these 34 respondents, 53 % own Tata Sky, 35 % own Dish TV, and 12 % own DD Direct
Plus.

So we can make out that even if Dish TV has been a player in the market for over 2 years, and DD
Direct Plus for over 1 and a half years, Tata has become popular in the market in a very small time.

This can be a result of heavy promotion, better dealer margins and better services that are offered
by Tata Sky.

SINCE HOW LONG HAVE YOU BEEN USING DTH?

Particulars Frequency Percentage

Less than 3 months 16 47

3 months - 1 year 12 35

1 year - 2 years 5 15

More than 2 years 1 3

34 100
These 34 owners of DTH connection were also asked to give the time period for which they had
been using the DTH connection.

The responses were as follows:

47 % said that they bought a DTH connection less than 3 months ago. So they were relatively new
customers of DTH.

35 % respondents were DTH owners for a time period between 3 months and 1 year.

15 % respondents purchased a DTH connection more than a year ago.

Only 3 % respondents had a DTH connection for more than 2 years.

So, in recent times, the purchase of DTH has increased, thanks to permanent implementation of
CAS and heavy advertising by DTH players.

COMPARITIVE ANALYSIS OF THE DTH PROVIDERS ON VARIOUS ATTRIBUTES

Tata Sky Dish TV DD Direct +

No of Channels 6 7 3

Charges 6 5 5.5

Picture Quality 7 6.5 5.5

Audio Quality 7 7 6

Games 7 6 3.5

interactivity 6 6 3

Languages Offered 6 6 3

transmission 7 6.5 5

storage Capacity 5.5 6 3

We have positioned the three DTH providers on the basis of consumer perception in order to draw
comparison between them on certain selected attributes.
In terms of No. of channels offered, consumers clearly give a vote of approval to the private players,
Tata Sky and Dish TV. DD Direct Plus lags behind as it only offers the free-to-air channels.

In terms of Charges there is very close competition among the three. Despite their high charges,
Dish TV and Tata Sky are giving DD Direct Plus a run for its money on account of superior television
experience offered.

Although the three service providers run very close in terms of picture and audio quality, Tata Sky
has done a commendable job of getting the highest ratings in these parameters. This can be
attributed to the company’s access to superior technology accessible through strategic business
partnership with the foreign players.

Although both Dish TV and Tata Sky are again fighting for the top spot in the Gaming slot, DD Direct
Plus lags behind significantly on account of less innovation and variety. The same holds true with
regards to Interactivity and Languages Offered.

In terms of Transmission, the private players are marginally ahead of the state owned DD Direct
Plus. But in terms of Storage Capacity, DD Direct Plus once again lags behind.

On an overall basis with regards to consumer perception, Dish TV and Tata Sky are competing hard
along all the attributes, but Tata Sky manages to secure a marginal lead over its closest competitor.
The state owned DD Direct Plus has a lot of catching up to do and lags behind on almost all the
parameters.

With the market likely to be flooded by the entry of new players, we can only expect to see the
competition heating up further.

DTH PROVIDES BETTER TRANSMISSION THAN CABLE TV

Agreement Frequency Percentage

CA 23 67

SA 8 24

CS 2 6

SD 1 3

CD 0 0
34 100

The 34 respondents who are owners of DTH connection were asked to rate their agreement on the
statement, “DTH TV provides better transmission than Cable TV.”

The responses were received under 5 headings, Completely Agree (CA), Somewhat Agree (SA),
Can’t Say (CS), Somewhat Disagree (SD), and Completely Disagree (CD)

The responses were:

Completely Agree-67 %

Somewhat Agree-24 %

Can’t Say-6 %

Somewhat Disagree-3 %

Completely Disagree-0 %

DTH IS CHEAPER THAN CABLE TV

Agreement Frequency Percentage

CA 10 29

SA 12 35

CS 4 12

SD 2 6

CD 6 18

34 100

The 34 respondents who are owners of DTH connection were asked to rate their agreement on the
statement, “DTH TV is cheaper than Cable TV.”

The responses were:

Completely Agree-29 %
Somewhat Agree-35 %

Can’t Say-12 %

Somewhat Disagree-6 %

Completely Disagree-18 %

DTH PROVIDES BETTER AUDIO QUALITY THAN CABLE TV

Agreement Frequency Percentage

CA 24 71

SA 8 24

CS 1 3

SD 0 0

CD 1 3

34 100

The 34 respondents who are owners of DTH connection were asked to rate their agreement on the
statement, “DTH TV provides better audio quality than Cable TV.”

The responses were:

Completely Agree-70 %

Somewhat Agree-24 %

Can’t Say-3 %

Somewhat Disagree-3 %

Completely Disagree-0 %

DTH PROVIDES BETTER PICTURE QUALITY THAN CABLE TV

Agreement Frequency Percentage

CA 23 68
SA 5 15

CS 5 15

SD 0 0

CD 1 3

34 100

The 34 respondents who are owners of DTH connection were asked to rate their agreement on the
statement, “DTH TV provides better picture quality than Cable TV.”

The responses were:

Completely Agree-67 %

Somewhat Agree-15 %

Can’t Say-15 %

Somewhat Disagree-0 %

Completely Disagree-3 %

DTH IS DESIGNED PRIMARILY FOR HIGH INCOME USERS

Agreement Frequency Percentage

CA 4 12

SA 7 21

CS 12 35

SD 4 12

CD 7 21

34 100

The 34 respondents who are owners of DTH connection were asked to rate their agreement on the
statement, “DTH TV is designed primarily for high income users.”
The responses were:

Completely Agree-12 %

Somewhat Agree-21 %

Can’t Say-34 %

Somewhat Disagree-12 %

Completely Disagree-21 %

CUSTOMER CARE SERVICE OF DTH IS BETTER THAN CABLE TV

Agreement Frequency Percentage

CA 18 53

SA 8 24

CS 6 18

SD 2 6

CD 0 0

34 100

The 34 respondents who are owners of DTH connection were asked to rate their agreement on the
statement, “Customer Care Service of DTH is better than Cable TV.”

The responses were:

Completely Agree-52 %

Somewhat Agree-24 %

Can’t Say-18 %

Somewhat Disagree-6 %

Completely Disagree-0 %

COMPULSORY IMPLEMENTATION OF CAS IS AGAINST GENERAL PUBLIC INTEREST

Agreement Frequency Percentage

CA 9 26

SA 12 35

CS 5 15

SD 7 21

CD 1 3

34 100

The 34 respondents who are owners of DTH connection were asked to rate their agreement on the
statement, “Compulsory implementation of CAS is against general public interest.”

The responses were:

Completely Agree-26 %

Somewhat Agree-35 %

Can’t Say-15 %

Somewhat Disagree-21 %

Completely Disagree-3 %

Conclusion

After all the in-depth analysis, scanning through detailed secondary research, after undertaking a
detailed and comprehensive primary research through depth interviews, observation method and
getting structured questionnaires filled by over 250 respondents, we can at least claim to provide
crucial data and figures pertaining to the people perception about television entertainment, about
their readiness to welcome this new technology and about the perception of DTH users about
various competing brands.

There are certain key aspects of our findings that we would like to mention here-

• Although most of the respondents were somewhat satisfied with their traditional cable operators
with regards to the transmission, video and audio quality, there has been a sense of dissatisfaction
that is evident with regards to the features like Customer Care Service and reasonability of charges.
Perhaps, a wake up call for the cable-wallas to look into the modern consumer’s needs and follow it
up with extensive customer care service.

• On being asked to rank the most preferred attributes associated with television entertainment,
Digital quality service was the most preferred attribute, ahead of charges and no. of channels
offered, a clear sign of the increasing desire of Indian consumers to enhance their television
experience.

• The penetration of DTH is slowly, but surely on the rise. 10% of our respondents had a DTH
connection at home. These are encouraging signs for the providers.

• A possible constraint for the rapid adoption process of this technology could be the high investment
that is associated with it. 89% of respondents said they would not like to pay an initial investment of
more than Rs. 3000 for a DTH connection. So, there is a case in point for the DTH providers to slash
the prices below the psychological barrier of Rs.3000. A very staggeringly high no. of respondents
(96%) said they won’t be willing to pay beyond Rs. 300 as monthly charges.

• However, despite these constraints, the future for DTH is bright. With 8% GDP growth, booming
economy, and fuelling consumption patterns, there is a rise in desires of a man traveling in a Karol
Bagh bus. The dissatisfaction with Cable Service providers may not send alarm bells ringing, the
wall of the Cable Raj may not be crumbling, but there are enough signs to show that a change of
guard may be in the offing. 68% of respondents felt that DTH will replace Cable TV. While these may
be subjective estimates, industry experts feel a new era in Indian Television Entertainment has
already begun.

• Comparison between the DTH service providers

o While the state owned DD Direct Plus comes close to the Private players like Dish TV and Tata
Sky in terms of transmission, audio and video quality, it clearly lags behind when it comes to
interactivity, no. of channels provided, on demand-movies and games offered. So, clearly it remains
a decisive war between Dish TV and Tata Sky while DD looks for a niche market for itself.

o Tata Sky Vs Dish TV

Availability and dealer experience: DishTV has many dealers hence good availability.But, dealers
claim to be trained by DishTV ‘s approach is rather complacent.. TataSky people were said to be
very systematic and skilled by the customers.
Attributes: Dish TV and Tata Sky run neck-to-neck in terms of various attributes. However, Tata
Sky is marginally ahead if one takes a purview of all the attributes into account. In terms of games,
picture quality and charges, Tata Sky crawls to the top position, just marginally beating Dish TV.

Dealer support: On observation at various dealer shops, we could sense a bias of most of the
dealers towards Tata Sky when they were asked by customers for the former’s advice. This may be
due to better margins or other promotional support that Tata Sky may be offering.

One can surely say that DTH has enormous potential for growth in Indian Market and there are
enormous opportunities for both the existing and upcoming players.

Is this the beginning of the end of the Cable Raj?

-No not yet, but a new technology is on the rise and would surely be something to watch out for in
times to come.

LIMITATIONS OF THE STUDY

1) Sample size was small i.e. 250 respondents, 12 dealers and 4 company personnel. Most of the
surveys are conducted on representative samples because it is usually impossible to include the
entire population. Findings of sample are extrapolated on to entire population.

2) The sample chosen was a combination of convenience sampling and judgment sampling. Both
these methods of sampling have an inherent element of bias.

3) Biases may creep in the information given by the respondents.

4) Main root of this research study was questionnaire & interview, which has its own limitations, for
example we can’t measure the reliability, enthusiasm dissonance etc.

REFERENCES

WEBSITES

• http://www.dishtvindia.in/

• http://www.ddinews.gov.in/DTH

• http://www.tatasky.com/

• http://www.rediff.com//money/2006/sep/05iycu.htm
• http://in.rediff.com/money/2006/sep/05iycu.htm

• http://www.comverse.com/products/cable_satellite_iptv

• http://us.indiantelevision.com/perspectives/y2k4/dth_dish.htm

• http://us.indiantelevision.com/perspectives/y2k4/dth_int.htm

• http://us.indiantelevision.com/perspectives/y2k4/dth_faqs.htm

• http://us.indiantelevision.com/perspectives/y2k4/dth_star.htm

• http://us.indiantelevision.com/perspectives/y2k4/dth_dd.htm

• http://www.iptv-industry.com/ar/3m.htm

• http://www.quentind.com/quantum/products/set_top_box.htm

• http://www.quentind.com/quantum/products/set_top_boxes.htm

• http://www.quentind.com/quantum/products/cas_elements.htm

• http://www.quentind.com/quantum/products/cas_glossary.htm

• http://www.financialexpress.com/fe_full_story.php?content_id=113275

• http://www.indianexpress.com/story/12505.html

• http://www.indiantelevision.com/special/y2k6/zee_dish.htm

• http://www.hclinfosystems.com/news49.htm

• http://inhome.rediff.com/money/2006/sep/05iycu.htm

• http://en.wikipedia.org/wiki/Tata_Sky

• http://www.mouthshut.com/review/Tata_Sky_TV-111803-1.html

• http://en.wikipedia.org/wiki/Dish_TV_India

• http://www.mouthshut.com/review/Dish_TV-70171-1.html

• http://en.wikipedia.org/wiki/DD_Direct_Plus
• http://www.televisionpoint.com/news2006/newsfullstory.php?id=114198334

MAGAZINES

• Business Today, October 22, 2006, Page 217, “Dish TV Vs Tata Sky: How They Stack Up

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