ITV

Tag: ARPU

  • Dish TV records 11.2% revenue growth for Q1-2014; higher Arpu’s, lower losses

    Dish TV records 11.2% revenue growth for Q1-2014; higher Arpu’s, lower losses

    BENGALURU: India’s largest DTH services provider Dish TV India Limited (Dish TV) reported first quarter fiscal 2014 standalone operating revenues of Rs 578.4 crore, recording 11.2 per cent growth over the Rs 519.95 crore operating revenues it clocked during Q1-2013. Also, its Q1-2014 standalone revenues were higher by 4.1 per cent than the Rs 555.4 crore the company reported for Q4-2013.

     

    Let’s take a look at the other figures for Q1-2014

     

    EBITDA of Rs 121.7 crore was lower by around 22 per cent for Q1-2014 as against EBITDA of Rs 156.6 crore the DTH provider reported for Q1-2013. EBITDA margin for Q1-2014 stood at 21 per cent. It had reported a 29.9 per cent margin for Q1-2013. However, Dish TV’s net loss was down to Rs 30.4 crore as compared to Rs 32.3 crore in the corresponding quarter last fiscal (Q1-2013) and Rs 43.6 crore in the previous quarter (Q4-2013).

     

    Dish TV’s primary expenses include cost of goods and services, personnel cost, administrative cost, advertisement expenses and selling expenses. Expenditure at Rs 456.7 crore was significantly higher by around 25 per cent than the Rs 364.4 crore the company reported for Q1-2013 and 4.9 per cent more than the Rs 435.4 crore it had reported for the previous quarter (Q4-2013).

     

    Dish TV’s advertising expenses for Q1-2014 at Rs 30.7 crore (which were 5.7 per cent of revenues of Q1-2104) were more than double (127.4 per cent higher) the Rs 13.5 crore during Q1-2013, and 84.9 per cent higher than Rs 16.6 crore during Q4-2013. It’s selling and distribution expenses during Q1-2014 at Rs 59.3 crore were also higher by 14.9 per cent than the Rs 51.6 crore during Q1-2013 and 2.9 per cent more than the Rs 57.6 crore in Q4-2103.

     

    Dish TV saw a gain of around two lakh in net number of subscriptions during Q1-2014. It had added 5.04 lakh subscriptions during Q1-2013. Subscription revenues for Q1-2014 were up 15.9 per cent at Rs 528 crore as compared to Rs 455.6 crore during Q1-2013 and higher by 5.6 per cent than the subscription revenues in Q4-2013.

     

    ARPU for the quarter increased 5.1 per cent to Rs 165 resulting in a 15.9 per cent y-o-y increase in subscription revenues. Dish TV reported a free cash flow of Rs 48.4 crore for Q1-2014 as compared with Rs 22 crore in Q4-2014 and Rs 65 crore for FY-2013.

     

    Dish TV chairman Subhash Chandra said, “In an ever changing world, the Indian media industry is keeping pace. Digitisation, which happens to be the most talked about, has still a lot to achieve even in the digitized towns and cities. Though it is comforting to see the evolution towards a transparent distribution environment, the distribution industry needs to act fast to leverage the opportunity to weed out the long standing inefficiencies in the system.”

     

    “Too much focus on box seeding has diluted the addressability part of the digitisation mandate. In such a scenario, Dish TV’s focus on quality additions is a counter-intuitive move which has started delivering encouraging results. The first quarter saw the company deliver strong free cash flows while maintaining healthy customer retention and investing in brand equity,” added Chandra.

     

    Dish TV managing director Jawahar Goel said, “In line with our expectations, pack price hikes and improved subscriber quality in the recent months resulted in a strengthened ARPU. On the expenses front, higher investment in marketing, brand building and seasonal sports driven content along with the impact of a weak rupee on dollar denominated costs, resulted in a sequentially flat EBITDA margin.”

     

    “We remain committed to add quality subscribers who would be value accretive to the business. Our successful initiation of a series of entry level price hikes, even in a not so perfect macro environment, demonstrate our pricing power and resolve to eliminate subsidies in the medium term. At the same time, we continue to expand our distribution network and consider ourselves amongst the best placed to reach out to customers who fit the bill. We are also making strong progress towards lining up additional transponder capacity to beef up our existing, industry leading bandwidth. We intend to leverage the additional capacity for distributing localised content as well as strengthen carriage revenues,” said Goel.

     

    Commenting on the persistent weakness in the rupee and its impact on the financials, Goel said, “A flagging rupee has been an industry wide concern since some time now. To contain further widening of gap between the cost of the consumer premises equipment (CPE) and amount realized from the customer due to rupee depreciation, Dish TV initiated an acquisition price hike of Rs 250 on 4th July. Sensing the need, other players in the DTH industry followed suit within the next few days.”

     

    “We are evaluating possibilities for improvement in hardware economics of CPE sourced from India, given a depreciating rupee. We have also been considering options with our overseas suppliers to commence production at a base in India,” he added.

     

    Talking about Dish TV’s overseas ventures, Goel confirmed, “Work on Dish TV Lanka (Pvt.) Limited, the company’s subsidiary, is progressing as per plan. Since it is going to be a zero subsidy model, it makes us all the more excited about the expansion.”

     

    With a sustained focus on strengthening the balance sheet, Dish TV says that it looks forward to retiring a significant portion of its outstanding debt. The company claims that it is well positioned, through its internal accruals, to repay approximately Rs 750 crore outstanding debt through the current fiscal.

  • Dish TV slashes losses in FY 2013; outlook improves

    Dish TV slashes losses in FY 2013; outlook improves

    MUMBAI: The Zee TV group DTH service provider Dish TV India Ltd (Dish TV) is slowly but gradually emerging from a sea of red ink; especially if one looks at the company‘s financials for the year ended 31 March 2013. Losses have been more than halved to Rs 66 crore from Rs 133.14 crore in the previous fiscal. Even its quarter losses have been reduced. Additionally, it added new subscribers in Q4 2013 at 200,000, taking up its net subscribers to 10.7 million.

    And things look likely to get even better for it if one goes by the massive 27 per cent it commands of the DTH market, and the fact that it is looking at raising average revenues per user (ARPUs), reducing customer subsidies in the medium term and in the process increasing profitability.

    Let us look at the standalone Q4-2013 results as against the corresponding Q4-2012

    Revenues for Q4 FY 2013 stand at Rs 555.40 crore, a rise of 7.5 per cent from the corresponding last year quarter Rs 516.44 crore. Subscription revenues at Rs 500 crore recorded a growth of 15.3 per cent. Total expenses too went up 7.4 per cent, standing at Rs 580.36 crore in Q4 FY 2013 (Rs 540 crore in Q4 FY 2012). Programming and content cost accounted for a large chunk of this increase rising 34 per cent during this period to Rs 196.72 crore as against Rs 146.76 crore.

    Although Dish TV reported a loss of Rs 43.62 crore, it is a 11 per cent improvement over the Q4-2012‘s loss of Rs 49 crore.

    Let us take a look at the Q4-2013 financials in comparison with Q3-2013

    Revenues in Q4-2013 have marginally decreased by Rs 2.42 crore as against Rs 557.82 crore reported in Q3-2013. While programming and content costs have risen by over 20 per cent to Rs 196.72 crore (Rs 162.69 crore in the immediate preceding quarter), it has got more efficient while reducing its selling and distribution expenses to Rs 74.2 crore (Rs 90 crore.). Additionally, it scaled down its advertising expenses by 30 per cent to Rs 16.6 crore (Rs 23.7 crore). EBITDA in Q4 2013 fell 12.8 per cent to Rs 120 crore against Rs 137.77 crore in Q3-2013. And losses fell to Rs 43.62 crore as opposed to Rs 44.48 crore.

    Dish TV has increased its new subscriber prices and pack prices in the past few months and has managed to bring down its subscriber acquisition cost (SAC) to Rs 1,996 as against Rs 2,201 in the immediate preceding quarter.

    The company added 200,000 net subscribers in Q4-2013- its lowest net new adds for a quarter since 2007 – taking its net subs base to 10.7 million. This low net add figure has alarmed some observers; but this has happened at a time when India is going through a gut wrenching change of digitisation of its cable TV infrastructure. Phase II of digitisation has been moving rather slowly with cable TV operaors in many cities which were supposed to come under the digitisation hammer fighting the government‘s mandate in courts and getting stay orders. So, many subscribers there are continuing to receiving analogue signals and hence have not moved to digital as yet. Hopefully, in the coming days as digitisation moves forward DTH providers will have some spillover benefits of subs moving to digital services.

    Dish TV‘s ARPUs were also lower for Q4-2013 at Rs 157 as against Rs 160 for the immediate preceding quarter.

    Let us look at the consolidated FY-2013 results as against FY-2012

    FY-2013‘s consolidated revenues stood at Rs 2,166.80 crore, a rise of 10.7 per cent as against last fiscal‘s Rs 1957.9 crore. It reported an EBITDA of Rs 575.9 crore as against Rs 496 crore last fiscal (a 16.1 per cent increase) with its EBITDA margin standing at 26.7 per cent.

    It has reported a 5.1 per cent YoY increase in content costs as against an overall increase of 11.5 per cent in total expenses to Rs 2,215 crore (Rs 1,983.8 crore).

    What is noteworthy is the way it has managed to bring down the net loss for FY-2013 to Rs 66 crore compared to Rs 133.14 crore in FY-2012. The earnings per share (EPS) too has shown a massive improvement from a negative Rs 1.25 to a negative Rs 0.62.

    Dish TV has a bouquet of 400 plus channels and it added another five HD channels in April 2013 taking its offering to 42 HD channels and services on its platform. Most analysts are bullish on the stock, currently trading at Rs 64.30.

    Says Dish TV chairman Subash Chandra, “In the media sector, digitisation, though not fully up to speed, holds big potential for the industry. DTH platforms, in particular, look forward to a level playing field contributing to meaningfully higher ARPUs and stickier subscriber bases over time. Dish TV‘s industry leading initiative, to hike acquisition and pack price is likely to be a catalyst to achieve that.”

    Dish TV recently launched India‘s first standard definition recorder, Dish+ with an unlimited recording facility. This was initially launched in the 42 cities covered under Phase 1 and Phase 2 of digitisation and is now available across India as a value for money differentiator over its competitors‘ offerings.

    Dish TV managing director Jawahar Goel points out that fiscal 2013 saw most players in the Indian DTH industry evolve to the next level and Dish TV led the industry and helped it pull off a significant increase in the new subscriber acquistion price over the last several months thereby reducing the effective cash burn per subscriber.

    “While the resultant decline in industry gross additions is marginal, it is expected to be well compensated by the quality of subscribers,” he highlights. “There was no respite though from the multiple taxation which the DTH industry is reeling under. Uncertainty on the rollout of goods & services tax (GST) continues to be an overhang on the earnings potential of the industry,”

    He is quite confident that DTH will score over cable TV thanks to the strong service back up the sector has built and its increasing focus on value growth rather than chasing subscriber numbers.

    “On the digitisation front, the MSO‘s readiness on encryption, packaging, dunning and effective business processes is taking undue time. With increasing expectations, customers however will gradually align to a technologically progressive and service oriented mass-scale platform, albeit at a premium. Dish TV has experienced strong though early signals of churned subscribers getting back to its platform in select markets in the current quarter,” says Goel says in a parting statement.

    Other points for FY 2013 to be noted are:

    * The company set up a 70:30 joint venture company Dish T V Lanka (Pvt) Ltd on 25 April 2012 under the laws of Sri Lanka with Satnet (Pvt Ltd). Satnet has a DTH licence and the joint venture will work on providing DTH related service in the island country.

    * The company has extended the life of the consumer premises equipment (CPE) for depreciation purposes of to five years for equipment activated on or after 1 April 2012. Upto 31 March 2012, in certain cases, the one-time advance contribution towards the CPEs in the form of rental was being recognized over a period of three years from the activation date. There is no significant impact on financial results of the quarter and year-ended 31 March 2013 on account of change in estimate for revenue recognition.

    * Dish TV’s net-worth as at 31 March 2013 is eroded by its accumulated losses. However, the management has prepared the financial results assuming that the Company will continue as a going concern considering that it has adequate resources in the form of operating cash flows, sanctioned credit facilities from lenders and bank deposits to adequately meet its obligations.

    * The name of the Company’s wholly owned subsidiary in Singapore, namely, Dish TV Singapore Pte Limited was changed to Digital Network Distribution Pte Limited on 12 March 2013. The Company entered into a share purchase Agreement dated 19 March 2013 with a party for transfer of its investment at an agreed price of Sing$12,000. On 1 April 2013, the share holding in Digital Network Distribution Pte Limited was transferred and, accordingly, as at 31 March 2013, the investments has been shown under current maturities of long term investment.

    * During the current year, Direct Media Distribution Ventures Pvt. Ltd (formerly known as Dhaka Warriors Sports Pvt Ltd) disinvested its holding in the Company from 59.86% to 45.24% and consequently, it ceases to be the holding company of Dish TV India Limited.

    *Hitherto, the exchange differences arising from foreign currency borrowing to the extent that they are regarded as an adjustment to interest cost, were treated as borrowing cost in terms of AS – 16, “Borrowing Costs.”

    During the year ended 31 March 2013, pursuant to a clarification dated 9 August 2012 from the MCA, the Company has changed the accounting policy w.e.f. from 1 April 2011, to treat the same as “foreign exchange fluctuation”, to be accounted as per AS – 11 “Effects of Changes in Foreign Exchange Rates,” instead of AS – 16 “Borrowing Costs”.

    This change has resulted in a reversal of finance cost of Rs. 70.68 crore and increase in depreciation by Rs. 11.24 crore during the year ended 31 March 2013. The aforesaid change, resulting in a net gain of Rs 59.44 crore, has been shown as ‘exceptional items’ in the financial results for the year ended 31 March 2013. In this regard, if the company had followed the same accounting policy as in the previous year, finance costs for the year would have been higher by Rs 58.41 crore; depreciation expense would have been lower by Rs 14.15 crore and the loss for the year would have been higher by Rs 44.26 crore.

  • Airtel DTH: Q4 2013 revenues & subs up, losses down

    Airtel DTH: Q4 2013 revenues & subs up, losses down

    MUMBAI: That the DTH market in India is doing well, is something that the Telecom Regulatory Authority of India (Trai) latest quarter report turned up. This is reflected in Bharti Airtel’s digital TV services financials for Q4 and financial year ended 31 March 2013 which were announced earlier this week.

    The division’s revenues are up even as average revenue per user (ARPU) has moved northwards (albeit marginally) and losses southwards. But the business is obviously burning cash – though lower than earlier – as competition is forcing DTH players to expand their reach nationally and offer newer services. All this – without being able to pass on costs to subscribers.

    Q4 2013 revenues are up 24 per cent to Rs 441.90 crore as against Rs 356.5 crore in the previous corresponding quarter of 2012. The company continues to be EBITDA positive with the number rising to Rs 29.6 crore (Rs 20.9 crore in Q4 2012). Its operating losses are down to Rs 178.4 crore (Rs 194.4 crore). It incurred a capex of Rs 132.6 crore (Rs 98 crore) during the quarter. Its cumulative investments in the DTH business up to end March 2013 stand at Rs 4036.6 crore (Rs 3298 crore).

    The good news is that ARPU is also up to Rs 184 in Q4 2013 (Rs 166 in Q4 2012). The company says this was “achieved through product innovations, pricing corrections and up-selling.” Its subscriber base grew 12 per cent from 7.2 million in Q4 2012 to 8.1 million (Q4 2013). The company attributes this increase to the digitisation drive across the four metro cities of the country and it expects this to accelerate further with phase II digitization.

    The DTH business’ revenues for the whole year rose 26 per cent to Rs 1629.4 crore (Rs 1296 crore up to March 2012). Its EBITDA numbers were down three per cent to Rs 45.2 crore (Rs 46.5 crore). Its operating loss rose from Rs 719.8 crore to Rs 815 crore. And its operating free cash flow requirement improved seven per cent from a negative Rs 763.4 crore to Rs 709.6 crore.
    The company says it is doing pretty well on its HD set top box rollout (HD), digital TV recorders with 3D capabilities, and in providing a superior customer experience. It currently offers 373 channels and services including 15 HD channels and six interactive services. It says it is the first Indian DTH player to “provide real-time integration of all the three screens viz. television, mobile and computer enabling our customers to record their favourite TV programs through mobile and web.”

  • Over 70 per cent of pay-TV subscribers in Western Europe able to receive multiscreen services

    Over 70 per cent of pay-TV subscribers in Western Europe able to receive multiscreen services

    MUMBAI: Parks Associates research finds over 70 per cent of pay-TV subscribers in Western Europe are able to receive a TV Everywhere/multiscreen service.

    In Eastern Europe, multiscreen availability topped 25 per cent of pay-TV households in early 2013. However, average revenue per user (ARPU) remains low, pushing many operators to test new business models such as a la carte pricing.

    Parks Associates president Stuart Sikes said, “Connected CE and digital media usage continues to grow in Europe, and cloud-based services, including music, video games, and storage, will drive more data across broadband provider networks.”

    “However, several challenges unique to Europe, including low margins, competition, and regulatory and economic factors, create uncertainties on the best path to boost revenues.” Sikes concluded.

  • India, China prime drivers of pay-TV revenue growth in Asia, says MPA

    India, China prime drivers of pay-TV revenue growth in Asia, says MPA

    MUMBAI: Asian tigers China and India together are expected to contribute almost 69 per cent of pay-TV revenues in the Asia Pacific from 2012 to 2020, according to findings of a new report by Singapore-based pay-TV research firm Media Partners Asia (MPA).

    MPA analysis shows that China and India will contribute 46 per cent and 23 per cent respectively to pay-TV industry revenue growth between 2012-20. Excluding China, India‘s contribution grows to 42 per cent, followed by Korea and Japan at 12 per cent and 13 per cent respectively, and Australia at 7 per cent.

    According to MPA, India‘s contribution reflects large volumes, a significant growth in accessible digital subscription revenues (distributed evenly across the value chain) and a large local advertising pie.

    In Southeast Asia, Malaysia leads with a 5.5 per cent contribution to revenue growth, driven by the growth of ARPUs and ad sales. Advertising revenues will also experience significant growth from a low base in key Southeast Asia markets such as Indonesia, Philippines, Thailand, and Vietnam.

    MPA forecasts indicate that Asia Pacific pay-TV industry revenues will grow at a 7.6 per cent CAGR between 2012 and 2020, doubling from $48 billion to $86 billion.

    Within this segment, subscription fees will grow at a 7.4 per cent CAGR, rising from $37 billion to $65 billion over the same period while net advertising revenues, calculated after estimated discounts, will grow at 8.1 per cent CAGR, reaching $21 billion in 2020 versus $11 billion in 2012, the report says.

    The digital pay-TV homes in Asia are projected to reach 696 million by 2020 from 444 million in 2012 driven by strong subscriber growth in India and China. Asia Pacific is expected to have 631 million digital pay-TV homes by 2017.

    The report adds that China and India will contribute 66 per cent and 21 per cent respectively to Asia Pacific pay-TV subscriber growth between 2012 and 2020.

    According to MPA, the Asia Pacific pay-TV subscriber growth is expected to witness robust growth with 13-14 million new subscribers added every year between 2013 and 2016, moderating thereafter though still adding close to 7 million subscribers per year by 2020.

    In Asia excluding China, India accounts for a massive 63 per cent of new subscriber growth between 2012 and 2020, underlining its huge importance to the pay-TV ecosystem, while Southeast Asia will contribute 16 per cent led by Indonesia at 7 per cent.

    Adjusting for multiple connections or homes, pay-TV penetration in Asia excluding China will grow from 53 per cent in 2012 to 61 per cent by 2020.

    Net new subscriber additions totaled 31 million in 2012, with year-on-year customer growth at 8 per cent. Excluding China, new pay-TV subscribers came in at a somewhat milder 13.4 million in 2012, taking the overall Asia ex-China subscriber base to 211 million.

    The growth in Southeast Asia was strong with 3.5 million new subscribers. India experienced a slowdown but managed to add close to 6 million new subscribers.

    Driven by digital TV (DTV) transition in China, India, Korea and Taiwan and the steady growth of DTV pay subs in Southeast Asia, MPA sees total digital subscribers growing from 257 million in 2012 to 539 million in 2017, and 626 million by 2020. Digital penetration of total pay-TV subs will grow from 58 per cent in 2012 to 90 per cent by 2020.

    After adjusting for multiple connections in a household, the MPA forecasts indicate that pay-TV penetration will climb from 51% in 2012 to 68% by 2020.

    The HD pay-TV subscriber universe is expected to rise exponentially to 160 million by 2020 from 37 million subscribers in 2012, while DVR subscribers will grow to 18 million from 6 million over the same period.

    China will be the major contributor to HD growth, followed by India, Japan, Korea, Australia, Taiwan and Malaysia, the report explains.

    The projections are published in a new report called Asia Pacific Pay-TV & Broadband Markets, an analysis of consumption, investment and revenue generation across pay-TV, broadband, digital TV and interactive value added services in 18 Asia Pacific markets.

    Commenting on the findings, MPA director Vivek Couto said, “A steady growth in population and a young demographic, combined with a rising middle class and the spread of wealth amongst local groups, is driving strategic decisions and execution in the pay-TV industry. These factors, in turn, will help boost household formation and consumer spends. This will also help grow pay-TV consumption and investment.”

    According to Couto, subscriber growth and revenue generation will be driven by: (1) Continued investment in local content, and the growth of localization among global and regional brands; (2) Digitalization in emerging markets; and (3) The growth of HD, premium and on-demand services in more mature markets.

    Significantly, the MPA report also notes: The growth of mobility and broadband penetration (with fiber expected to play a larger role in the future) is also influencing pay-TV strategy, execution and consumption.

    Fragmentation of eyeballs is growing with the proliferation of multiple devices. This is also driving consumption of illegal online video in many territories. The response of pay-TV companies has been defensive and aggressive in equal measure, the report notes.

    In 2012, TV Everywhere (TVE) type solutions with improved windows have been deployed across most of the region largely authenticated to customers with a pay-TV connection.

    Arguably, the most aggressive responses have come from content powerhouses that own most of their IP with clear packaging and a commitment to product innovation, the report concludes.

  • IPTV’s share in pay TV to rise to 18% by 2018 from 11.5% in 2012

    IPTV’s share in pay TV to rise to 18% by 2018 from 11.5% in 2012

    MUMBAI: The worldwide pay-TV market grew at a steady pace in 2012 generating $238 billion by end-of-year, up from $223 billion in 2011, according to ABI Research‘s ‘Pay-TV ARPU and Revenues‘ Market Data.

    The global pay-TV market is expected to generate $304 billion in 2018 with a CAGR of four per cent.

    Service revenue contributions from cable TV are proving mixed. The Asia-Pacific region saw service revenue growth due to underlying increase in subscriptions. However, cable TV operators in North America are experiencing a decline in service revenue as result of a contracting subscriber base, despite cable TV innovations such as DVR and HDTV.

    Globally, IPTV is gaining market share year-over-year while the rest of the pay-TV platforms are slowly contracting. IPTV service revenue market share increased from 10 per cent in 2011 to 11.5 per cent in 2012. Cable TV market share dropped to 47 per cent in 2012 from 48.5 per cent in 2011 while satellite TV market share dropped around one per cent.

    ABI Research VP, practice director of core forecasting Jake Saunders said, “Availability of super-fast broadband networks and bundle offers from telcos over high-speed networks are driving the growth of IPTV adoption. IPTV market share is expected to increase to 18 per cent in 2018, to generate $53 billion in revenue”.

    ABI Research analyst Khin Sandi Lynn said, “Based on ABI Research‘s global Pay-TV market share analysis, satellite giant DirecTV ranks top in terms of Pay-TV service revenue across all platforms. In the global IPTV sector, Verizon is the top ranked IPTV operator with the highest service revenue”.

  • Airtel Digital TV Q3 operating profit up amid strong subscriber growth

    Airtel Digital TV Q3 operating profit up amid strong subscriber growth

    MUMBAI: Airtel Digital TV, Bharti Airtel‘s direct-to-home (DTH) arm, continued to post operating profit for the second straight quarter amid healthy net subscription additions and a rise in ARPUs while churn rate has improved.

    The operating profit was at Rs 147 million in the fiscal third-quarter ended 31 December, up from Rs 33 million in the trailing three-month period.

    Airtel Digital TV added net 439,000 subscribers compared to a weak earlier quarter in which it grew just 55,000 new customers.

    “Digitisation and the festive season helped us grow our subscriber base in the third quarter. We expect this quarter (beginning January) to be good. Some of the gains from digitisation (38 cities by 31 March as mandated by government), though, will be captured in April,” Airtel Digital TV chief executive officer Shashi Arora told Indiantelevision.com.

    Airtel Digital TV‘s subscriber base grew 6 per cent to total 7.9 million.

    The company narrowed its fiscal third quarter loss before tax and interest to Rs 1.83 billion from Rs 2.23 billion in the earlier quarter. Revenue grew 29 per cent to Rs 4.28 billion from Rs 3.94 billion.

    A striking feature this quarter has been how Airtel Digital TV has lifted its average revenue per user (ARPU) while at the same time improving its churn rate. ARPU increased 5 per cent to Rs 186 from Rs 177 in the previous quarter. The monthly churn decreased to 1.3 per cent in the third quarter from 1.9 per cent.

    The improvement in ARPU has been achieved through product innovations, pricing corrections and upselling.

    “Our HD (high definition) contribution is relatively higher than the other DTH companies. This has led to a rise in ARPUs for us,” said Arora.

    Dish TV, India‘s largest DTH operator by subscribers, marginally increased its ARPU to Rs 160 from Rs 159 in the trailing quarter.

    During the quarter ended 31 December, Airtel Digital TV incurred a capital expenditure of Rs 1.35 billion in digital TV services.

  • Dish TV slips into net loss, adds 0.83 mn subs in Q3

    Dish TV slips into net loss, adds 0.83 mn subs in Q3

    MUMBAI: Dish TV, India‘s largest direct-to-home (DTH) operator, has again slipped into quarterly net loss and performed below market expectations despite showing remarkable growth in subscriber numbers.

    The company posted a net loss of Rs 448.8 million in the fiscal-third quarter, compared to a net profit of Rs 550.90 million in the trailing quarter, as content and other costs surged.

    Dish TV‘s operating profit for the three-month period ended 31 December declined 11.5 per cent to Rs 1.38 billion compared to Rs 1.5 billion in the previous quarter. Ebidta margin for the quarter stood at 24.7 per cent.

    "The content cost rose partly due to Media Pro which distributes the Star, Zee and Turner group of channels. The selling and distribution expenses also went up," said a media analyst.

    Dish TV‘s expenses jumped to Rs 5.9 billion from Rs 5.3 billion as programming/content and other costs rose to Rs 1.63 billion from Rs 1.42 billion in the preceding quarter. Cost of goods and services grew 11.2 per cent to Rs 2.8 billion from Rs 2.5 billion in the preceding quarter, amounting to 51 per cent of gross revenue. Advertising and promotional expenditure rose 6.8 per cent to Rs 237 million from Rs 222 million. Selling and distribution expenses rose 26.6 per cent to Rs 661 million from Rs 522 million.
    Operating revenue for the quarter stood at Rs 5.58 billion, recording a growth of 4.5 cent as compared to Rs 5.3 billion in the preceding quarter. Total income for the quarter increased to Rs 5.7 billion from Rs 5.4 billion in the previous quarter.

    Subscription revenues for the quarter were Rs 4.9 billion, up from Rs 4.72 billion .

    The company’s other income jumped 118.7 per cent to Rs 175 million from Rs 80 million in the previous quarter.

    Subscriber additions

    Dish TV added 829,000 new subscribers during the third quarter achieving a total of 14.7 million gross and 10.5 million net subscribers at the end of the period. In the previous quarter, the company had added 477,000 subscribers.

    "Dish is looking at adding 2.5 million subscribers this fiscal. It continues to have a strong subscriber growth and has added 1.8 million new customers so far in this fiscal," the analyst said.

    Subscriber acquisition cost falls

    Subscriber Acquisition Cost (SAC) during the quarter declined to Rs 2,201 compared to Rs 2,273 in the preceding quarter. "While the subscriber growth was much higher than the previous quarter, the marketing expense did not go up as much. This led to a fall in SAC," the analyst added.

    Dish TV MD Jawahar Goel said, “While the distribution industry remained on tenterhooks preparing for digitization, the third quarter saw the much debated compulsory switch off of analog television signals take place in key metro markets. Although lack of execution in Chennai and Kolkata was a dampener, festival demand coupled with mandatory conversion in Delhi and Mumbai brought the DTH industry back to the 1 million plus monthly run-rate. DTH garnered around 35 per cent share of incremental additions post the sunset date.”

    “In line with our expectation, we witnessed significant subscriber uptake around the sunset date of 31st October. Dish TV achieved the largest share of 28 per cent amongst DTH platforms in the digitization territories. ‘Dish+’, India’s first standard definition recorder, played its part in differentiating and attracting consumer interest in a crowded market,” he added.

    ARPU improves

    The company‘s Average Revenue Per User (Arpu) grew marginally by a rupee to Rs 160 due to a price hike in the third quarter, up from Rs 159 in the previous quarter.

    Goel said, “A larger base did create pressure on the average revenue per user which, primarily supported by price hike in the second quarter, increased marginally to Rs 160. In the third quarter, apart from the usual additional spends typically experienced due to the festive season, additionally this year the company’s investments to capitalize on the digitization opportunity are also reflected in higher costs during the quarter. A seasonally higher marketing expense was as per budget. Content cost for the year is expected to be within the guided range of 12 per cent increase over the previous fiscal.”

    Dish TV recently launched India’s first Standard Definition Recorder, ‘Dish+’, with unlimited recording facility. ‘Dish+’ comes equipped with a USB slot and is positioned at a competitive price compared to non recorder ready boxes. ‘Dish+’ was initially launched in the 42 cities covered under Phase I and Phase II of digitization and is now available across India as a value for money differentiator over other boxes in the market.

    In a first within the television distribution industry, Dish TV has launched recharge option through Interbank Mobile Payment Service (IMPS) through which the subscriber can recharge his Dish TV account securely and conveniently through an instant, interbank electronic fund transfer service that can be initiated only through mobile phones.

    Considering the deep penetration of cell phones in the country, money transfer through them is likely to emerge as a popular mode of transacting for daily services in the days ahead, the company said.

    Shares of Dish TV fell 4.96 per cent to close Tuesday at 73.7 on the BSE.

  • Videocon d2h’s Arpu in 2012-13 first half at Rs 135

    Videocon d2h’s Arpu in 2012-13 first half at Rs 135

    MUMBAI: The average revenue per user (Arpu) per month of Videocon d2h, the direct-to-home (DTH) television service of Bharat Business Channel, was Rs 135 in the six months ended 31 October 2012, up from Rs 113 in the fiscal year beginning 1 April 2011.

    Videocon d2h‘s gross subscriber base as on 31 October was 6.62 million, up 21 per cent from 5.48 million as on 31 March 2012.

    The company‘s subscriber acquisition cost in the first half of 2012-13 was the lowest at Rs 2,021 per subscriber as it procures set-top boxes (STBs) locally from a group company.

    Videocon d2h will buy from group firm Trend Electronics Ltd (TEL) 1.6 million standard definition STBs at Rs 1,400 per piece, 0.4 million high definition STBs at Rs 1,700 per piece and two million outdoor units and accessories at Rs 627 per unit.

    Bharat Business Channel has filed a draft prospectus for an initial public offering (IPO) to raise Rs 7 billion.

    Videocon d2h has the highest subscriber addition rate with a 25 per cent share in the total additions by DTH players in the first half of 2012-13. In the whole of 2011-12 too Videocon d2h had the highest share of 24.4 per cent in new subscriber additions.

    The company‘s monthly churn rate too was lower at 0.89 per cent in the first half of 2012-13 from 1.16 per cent in the whole of 2011-12.

    Airtel DTH and Dish TV, the competitors of Videocon d2h, had monthly Arpu of Rs 171 and Rs 154, respectively, while the monthly churn rate of Airtel was 1.9 per cent and Dish TV 0.8 per cent in the first half of 2012-13.