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DTH measures not likely to benefit consumer

business Updated: Apr 21, 2008 23:25 IST
Saurabh Turakhia
Saurabh Turakhia
Hindustan Times
DTH measures not likely to benefit consumer

The Information and Broadcasting ministry's decision last week to cut licence fee for DTH service providers from 10 per cent to 6 per cent of gross revenue may have brought some relief to the industry, but there is little to cheer the consumer.

Private DTH players, Tata Sky and Dish TV are already making losses and it is unlikely that they will cut tariff rates to pass on the benefit on lower fees to consumers.

“This move will benefit existing as well as new DTH service providers. However, we have been bearing the entire burden of the license fees and hence, there is no way any benefit from this can be passed to the consumer,” said Jawahar Goel, managing director of Dish TV.

Currently, both Dish TV and Tata Sky are offering services at subsidised rates to get more and more subscribers before new players make aggressive entries.

Also last week, the Telecom Regulatory Authority finalised a roadmap for speedy conclusion of interconnection agreement between broadcasters and DTH licencees. That will allow DTH service providers, but not the end consumer, to buy channels on an a-la-carte basis. The consumer will still be offered packages from the DTH service providers.

New players like Reliance, Bharti and Videocon are likely to take advantage of the reduced license fees by aggressively pricing their offerings. According to sources, Reliance’s Big TV may introduce packages with attractive prices and multiple offers.

Dinyar Contractor, editor and executive publisher of Satellite and Cable Television said: “It is more than just a coincidence that ahead of the launch from a new DTH service provider, these announcements are coming in.”

According to a source, the DTH industry had reached a plateau in terms of penetration. Since the transponder capacity is less, now with a-la-carte channel availability, DTH players will pick and choose and offer bouquets to the consumers.