Reliance's DTH Venture Blue Magic may be in operation by the end of this year, informed industry sources. It is expected to differentiate its offering by way of quality of service and content. With Reliance already having bought over FLAG, submarine cables will be of good use.
However as far as pricing is concerned, the source mentioned that DTH services are not viable below Rs 500 per subscriber and hence Blue Magic may be expected to offer its services at Rs 500. Close to Rs 200 crores have gone into the DTH venture of Reliance.
Interestingly, Sun as well as Bharti Airtel have their DTH projects lined up. However, industry observers believe that while Sun may make its entry this year, Bharti Airtel will take at least another one and a half years.
The Bharti Airtel board has approved commencement of direct to home (DTH) services, through its wholly owned subsidiary Bharti Telemedia.
The potential of DTH in India is considered to be at 10 million subscribers. Of this universe, Dish TV and Tata Sky have already got close to 3.5 million subscribers. So the balance 6.5 million subscribers will effectively be shared between the five players. However, some shifting will also take place. Sources say that Blue Service may be looking at getting close to 2 million subscribers of the balance share.
If a DTH subscriber shifts to another operator, the earlier set top box stands useless. So, while those with deep pockets will replace the set top box free of charge in order to get more subscribers, the ones running on tighter budgets will have to address this issue differently, considering that investment in set top boxes by a consumer is close to Rs 3000.
As of now, there is no law in place for DTH. It is also believed that while the government only gets taxes from CAS, it has a revenue sharing with DTH players.