India to overtake U.S. in direct-to-home

Market projected to over $12 bil by 2014

NEW DELHI -- India will become the largest direct-to-home market in the world in terms of subscribers by 2012, overtaking the United States, according to a report by Hong Kong based research agency Media Partners Asia.

The report “India Specific Pay-TV and Broadband Markets 2010” states that DTH subscribers will climb from a net installed base of 17 million in 2009 to reach 45 million by 2014, and 58 million by 2020.

India's pay TV sector generated sales of $6.5 billion for the financial year March 2010 projected to grow to $12.1 billion by 2014 and $18.5 billion by 2020.

“The future of pay TV in India will be driven by media owners and distributors expanding market share with an eye on profits, rather than at the expense of profits,” the report adds.

 “We are more positive on India’s DTH opportunity than previously, especially when anchored to consolidation and improved pricing power with continued growth. We suspect the DTH market will consolidate from six to four platforms within three to five years, and estimate four will be making money at the EBITDA level by financial year March 2013,” MPA executive director Vivek Couto said,

Couto also pointed that “competition will remain intense, as the main theater of war shifts to regional markets. The major risk to all our growth assumptions is regulation, which continues to commoditize and destroy industry value.”

MPA projections suggest that Indian pay TV subscribers will grow from 105 million in 2009 to 149 million by 2014, and 173 million by 2020. This means pay TV penetration will grow from 78% in 2009 to more than 90% long-term. Cable will retain 70% market share by 2014, falling to 64% by 2020, while DTH will scale up to almost 35% share long-term.

In 2009, 15% of India’s pay TV homes had at least one set-top box; this number will grow to 38% by 2014 and almost 50% by 2020 with HDTV gaining more traction after 2010, driven by DTH satellite networks. Cable broadband, a key driver of future cable sector profits, will grow from 850,000 homes in 2009 to 3 million by 2014.
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