DTH firms may miss à la carte deadline

DTH firms may miss à la carte deadline
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First Published: Wed, Dec 29 2010. 08 24 AM IST
Updated: Wed, Dec 29 2010. 08 24 AM IST
Mumbai/New Delhi: Customers seeking greater choice over what they watch and how much they pay for it may have to wait for some more time with most direct-to-home (DTH) and Internet protocol TV companies set to miss a 1 January deadline for offering an à la carte option.
A July 2010 order by the regulator Telecom Regulatory Authority of India (Trai) said that all digital platforms must offer consumers the choice of paying only for channels that they wish to watch. Currently, companies offer bouquets or bundled channels priced as a package.
DTH companies, which together serve around 29 million households, cite technical and operational reasons for their inability to meet the deadline, but an analyst said their inertia could also be explained by the prospect of seeing up to a 20% fall in revenue.
An official from Trai, which set the deadline, said that this would be “considered non-compliance of Trai’s order”.
“It’s too early to comment on the implications,” added this person, who did not want to be identified.
The sheer complexity of providing options to customers has the operators stumped, admitted an executive at a DTH firm. “We have 9 million subscribers. À la carte means offering all sorts of permutations and combinations to customers and just as many complications in servicing them. We need time to do this and are evaluating how to go ahead,” said Salil Kapoor, chief operating officer, Dish TV, India’s largest DTH company by subscriber base. Kapoor added that his company was trying its best to meet the deadline.
The companies have had enough time to do so. Trai’s order came in July. And it came into effect from 1 September, although DTH companies were offered an extension up to 1 January if they needed it. Cable companies that use a digital delivery platform have already started offering customers the choice of picking the channels they want to watch.
Another executive working for a DTH company said that companies do not have the required infrastructure to offer à la carte services. “If a consumer wants just Star Plus and MAX, we’d have to provide it at a moment’s notice. However, the consumer can change his or her mind in the next few days. So, operationally, it’s a lot tougher to keep track and the service has to be very quick,” added this person, who did not want to be identified as he is not authorized to speak to media.
Sanjay Behl, chief executive of Reliance BIG TV Ltd, echoed that sentiment and said that with 400 channels on air, there are bound to be operational issues such as those to do with billing. “We are evaluating just how soon we can give channels à la carte,” he said.
Saurabh Dhoot, director, Videocon group, which offers DTH services under the Videocon d2h brand, added that his company too was trying to meet the deadline.
Roop Sharma, president of the Cable Operators Federation of India, an industry body, said DTH companies were using “delay tactics”. “They have the technology but don’t want to sell individual channels since packages get them more revenue,” she alleged.
Digital cable operators, meanwhile, have already started offering prices of individual channels to customers.
Digicable Network (India) Pvt. Ltd, a large cable TV operator acquired by Anil Ambani’s Reliance Communications Ltd, offers à la carte services in parts of Kolkata, Delhi and Mumbai besides all of Chennai, with each channel being priced at Rs5 and customers being required to opt for at least five channels. In addition to these, the customers get around a 100 free-to-air channels.
In most cases, individual channels are priced even lesser than that at, say, Rs3-4 each, said K. Jayaraman, managing director and chief executive of Hathway Cable and Datacom Ltd, another digital cable company.
The analyst cited in the first instance said the reluctance of DTH firms to go this route may have to do with the way customers are likely to behave, choosing to pay for a few general entertainment and news channels but not for the rest, bringing down their bill and the operators’ revenue.
Interestingly, not all DTH companies are dragging their feet over implementing an à la carte option. Tony D’Silva, chief executive of DTH service provider Sun Direct, confirmed that the company is offering channels on à la carte basis.
And Harit Nagpal, managing director and chief executive, Tata Sky Ltd, said his company was working towards the same, although it poses “serious technological challenges”. “We are addressing the concerns but our endeavour will be to abide by the government guidelines at the earliest.”
A spokesperson for Bharti Airtel Ltd DTH declined to comment for this story.
The Telecom Disputes Settlement and Appellate Tribunal, in a judgement issued on 16 December, had asked the regulator to review the issues related to à la carte tariff rates, but the July order stands.
anushree.m@livemint.com
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First Published: Wed, Dec 29 2010. 08 24 AM IST
More Topics: DTH | Digital Cable | Internet | TV Channel | Trai |