Break-even and profits are still a long way off for Tata Sky and Dish TV. Competition from Reliance & Airtel is also round the bend. With the 2nd phase of CAS still a distant dream, life is certainly not jhingalala for DTH players, says surbhi chawla
If there’s someone who would want to steer clear
of the colour red at the moment, it will be the two Indian biggies offering Direct-to-Home (DTH) services. Both Tata Sky and Dish TV are expecting embarrassing red blots (or losses, if you please) to the tune of Rs.1500 crore for FY 2007-08. But ask Vikram Kaushik (CEO of Tata Sky) and Jawahar Goel (Managing Director of Dish TV) and they firmly refuse to press any panic buttons. “These are budget losses,” the duo averred in unison, when quizzed by this magazine, adding that the situation is pretty much under control.
While Goel and Kaushik may make light of the situation, experts in this industry opine that one of the major reasons for these humongous losses can easily be attributed to the subsidy that these providers have to give on selling individual set-top boxes. Besides, one also needs to factor in that DTH is a capital intensive industry and is at a very nascent stage in India. The challenge for existing players and new aspirants in the segment is to primarily set up the requisite infrastructure, which is both time consuming, and also calls for heavy investments. Goel points out, “We’re bleeding at this moment & have a long way to go, to reach the break-even point. Only then can we start thinking about expected returns.”
If there’s someone who would want to steer clear
of the colour red at the moment, it will be the two Indian biggies offering Direct-to-Home (DTH) services. Both Tata Sky and Dish TV are expecting embarrassing red blots (or losses, if you please) to the tune of Rs.1500 crore for FY 2007-08. But ask Vikram Kaushik (CEO of Tata Sky) and Jawahar Goel (Managing Director of Dish TV) and they firmly refuse to press any panic buttons. “These are budget losses,” the duo averred in unison, when quizzed by this magazine, adding that the situation is pretty much under control.While Goel and Kaushik may make light of the situation, experts in this industry opine that one of the major reasons for these humongous losses can easily be attributed to the subsidy that these providers have to give on selling individual set-top boxes. Besides, one also needs to factor in that DTH is a capital intensive industry and is at a very nascent stage in India. The challenge for existing players and new aspirants in the segment is to primarily set up the requisite infrastructure, which is both time consuming, and also calls for heavy investments. Goel points out, “We’re bleeding at this moment & have a long way to go, to reach the break-even point. Only then can we start thinking about expected returns.”
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