Digital Pay-TV Takeup Set to Soar in India

MUMBAI: There will be 130 million digital pay-TV homes in India by 2020, according to new research from Media Partners Asia (MPA), reflecting about 60 percent of all TV homes in the country, up from 28 percent last year.

The report, India Pay-TV & Broadband Markets, also notes that digital penetration of total pay-TV homes will double from 35 percent in 2012 to almost 70 percent by 2020. Total pay-TV homes are set to hit 183 million by 2020 from 128 million last year. Total industry revenues are expected to reach $17 billion by 2020 from $7.8 billion last year, with a compound annual growth rate of 10.2 percent.

The report notes that India’s satellite and cable operators are carrying high levels of debt. As such, the majority of the funding to facilitate growth of the pay-TV business will have to come via IPOs and M&A activity.

“A successful start for the roll-out of digital addressable systems (DAS) has revived interest in pay-TV among strategic and financial investors,” said Vivek Couto, MPA’s executive director. “The real benefits will become clearer in 2H 2013 and beyond, as multi-system operators (MSOs) drive addressability and work with last mile local cable operators (LCOs) to ramp up tiering, billing and collections. Regulators are committed to curbing delays in the next phases of DAS, while the DTH industry is keen to revive growth by capitalizing on digital transition.”

Cable homes with DAS will rise from just 15 percent last year to 50 percent by 2020, as operators build out infrastructure and roll out broadband and HDTV services. DTH subs are expected to rise from 32 million last year to 77 million in 2020.

The MPA report also looks at pay-TV channels, which are expected to generate revenues of $8.6 billion by 2020, from $3.6 billion last year. The CAGR for ad revenues in the period is forecast at 10 percent; sub revenues are expected to rise 15 percent.