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DTH - But will it take off ?

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After the recent past uplinking facility, the Union government has cleared the controversial direct-to-home (DTH) services after putting it on hold for years. DTH broadcasting platform, the next big leap in the television industry in India would be implemented soon with many companies queuing up for the licenses. But what are the features of this DTH and how would be the television industry in India in the near future?

DTH is a set-top box along with a small 12 to 18 inch satellite dish that enables viewers to receive high quality satellite transmission while dispensing with cable wires. In simple terms, DTH television service implies the distribution of multi-channel TV programmes in Ku band through a satellite system by providing TV signals directly to subscribers' premises, without passing through intermediaries like cable operators.

One could have access to all these multiple channels directly at home using a small antenna and a set-top box. The reception requires very small dish antenna (12-18 inch diameter), compared to large dish antenna (8-16 feet diameter), in lower C-band frequencies. DTH broadcasting implies better quality reception, digital technology, more choice to consumers, ideally suited for areas not serviced by cable TV, and a broadband backbone for convergence and IT-enabled services. Promising enhanced picture quality, it also has the scope for interactive TV services like movie on demand and possibility of introducing value-added services like Internet access, E-mail, home-shopping, banking and tele-education.

The digital satellite receiver box is small box which can attached to the viewer's TV set and would be connected to a small dish. The box contains sophisticated software which, together with the viewing card, unscrambles the digital TV signal and allows the viewer to watch the DTH service. For decoding a channel at home, the subscriber would be provided pre-paid channel SIM cards. The viewing card acts as a key to the access to any DTH platform and hence a control at the box and card level ensures unauthorised viewing.

Most of the broadcasters are thinking of switching over to the DTH mode for the past few years as they had realised that no channel can sustain with advertisement revenue alone and subscription was also a necessary ingredient in the success of the channel business.

In this direction, the government has cleared the DTH broadcasting facility and the license would be given with a validity for a period of 10 years. The new broadcasting system would be a free platform with a restriction of 20 per cent cap on foreign direct investment (FDI). i.e, the total foreign investment in DTH cannot exceed 49 per cent - 20 per cent FDI and 29 per cent through FIIs or NRIs. Though no restrictions have been put on the number of players, the entry fee has been pegged at Rs.10 crore, along with a Rs.40 crore bank guarantee. In addition, DTH platform owners have to pay 10 per cent of their revenue as annual fee.

Apart from these investment regulations, there are some more norms which any DTH player will have to conform to. First, uplinking has to be done from India. Second, the earth station must be built in India within 12 months from the date of issue of license. Third, programme cassettes cannot be destroyed within 90 days of running a programme. These steps would help the government monitor the programmes and the advertisements run on the DTH platform. The programme and the advertising code will be applicable here too. Any violation of licensing conditions may call for a penalty upto Rs.50 crore along with revocation of the license.

DTH already existed in the country, but was possible only on C-band frequencies. Satellite broadcasters have been using the C-band all these years to send TV pictures into homes either directly or via roof-top antennae or through cable operators. With DTH broadcasting, TV companies could beam their programmes in Ku-band (higher frequency ranging between 11.7-14.55 gigahertz) instead of the C-band (lower frequency ranging between 3.4-6.65 Ghz).

DTH has been prominent in many countries. In Britain, DTH became a success largely because cable television was not a popular medium. Though the UK started building its cable network by 1984, only 1.9 million out of 8.4 million television homes (22 per cent) had enrolled by 1997. But in the US, DTH was relatively more successful mainly because of the extremely poor picture quality of cable TV and the pent-up demand for multichannel television among people not covered by cable.

But in India, as DTH is to be launched, which would take some more time, when the broadband access (which represents a high speed technology alternative to the traditional dial-up Internet service) revolution is in full swing, the DTH market is expected to meet with limited success.

There are negative implications with this DTH. While direct-to-home (DTH) broadcasting will imply unlimited channel access to the consumer, prohibitive costs are likely to deter the masses. For example, installation costs could be in the region of Rs.10,000-15,000, in addition to a monthly fee of Rs.600-700. This installation costs and subsequent subscription of DTH services would be a costly proposition for the consumers vis-a-vis the cable TV services.

For the companies too, they need Rs.500 million to Rs.600 million to start a DTH service. The cost of uplinking or a broadcast/ network operating centre, is over Rs.30 million. Transponder lease would be around Rs.3.5 million to 4 million per annum with a minimum of five transponders required; customer service centres, of which at least 10 would be required, would be 500,000 to 1 million per centre. Plus 15-20 per cent of the costs would go towards sales and marketing, entertainment tax would 30 per cent, there would be the cost of content, and the license fee.

Though the Rs.4,000-crore cable television industry would have an adverse impact with this DTH, they can breathe a sigh of relief as this DTH broadcasting platform is projected to acquire a mere one million subscriber base in the first two years of operations. This is significantly lower considering the 40 million subscriber base of the cable television industry. This projection can soothe the frayed tempers of cable television industry as the big fish DTH may not swallow the cable TV market share. Going by viability, DTH is unlikely to offer a competitive and cost-effective delivery alternative to cable TV, especially in a price-sensitive country like India.

With the DTH services expected to be operational in a year, the licensee will have to undergo tremendous changes in the existing technicalities, have to put up its own earth station and also, a legal framework will have to be put in place before licenses are issued to various applicants. On the whole, clearance for the DTH is a major step towards convergence, and would provide a broadband backbone for IT-enabled services too. It is best left to the market to decide on the investment flows to the sector and the consumers/ viewers to decide on both the choice of the delivery medium - DTH versus cable.
Posted by ramkumar at 9:41 AM 0 comments
Direct-To-Home (DTH) satellite broadcast - Newtec
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Posted by ramkumar at 9:33 AM 0 comments
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Broadcast
Direct-to-Home satellite broadcasting

Satellite DTH is a strong alternative to cable TV. It enables customers to receive a minimum of 200 to 300 channels on a fairly economical basis. The other advantage is the availability of satellite broadcast in rural and semi-rural areas where cable is difficult to install.

If you are a DTH service provider or if you build DTH uplink systems, you know that the efficient use of the satellite capacity and the availability of the service are key elements to the success of your business.

Newtec offers the most advanced and reliable modulation solutions on the market. Our broadcast modulators are being used to deliver hundreds of DTH services worldwide and are offered by most of the leading DTH platform providers. These modulators deliver the best performance in both DVB-S and DVB-S2, also enabling HDTV services at an acceptable cost.

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* DVB-S and DVB-S2 Broadcast modulators
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