Dish TV tries to win over cable operators to ride digitization wave

Subash Chandra-owned Zee Groups’ DTH platform Dish TV has bowled a googly in the ongoing scamper for snapping up subscribers during the cable digitization wave.

While the whole battle was seen as DTH operators fighting with cable operators to lure away the latter’s customers at the time of digitization, Dish TV has unveiled a new strategy.

Instead of going head on against all cable operators, it has decided to co-opt the smaller ones to its fold and convert them into resellers of its DTH services and products.

Cable customers in India will be forced to shell out about Rs 1000 at the end of this month to buy set-top-boxes as all services will switch to the digital mode from July 1 onwards.

What has set the mouth watering among DTH operators is the fact that Rs 1000 is also what they charge as the installation fee from new customers.

In other words, as the consumers are forced to spend Rs 1000 by cable operators, they become vulnerable to being poached by DTH operators. Many cable TV consumers have so far resisted migrating to DTH due to the 1000-rupee start-up charge.

Under its new scheme, Dish TV is offering local cable operators or LCOs — who maintain the last-mile networks — a partnership almost similar to what they now have with their feed providers or MSOs (Multi System Operators.)

Cable operators currently pay a fixed monthly charge to MSOs in exchange for getting a feed of channels that they then distribute to their customers.

Dish TV is promising a commission to cable operators for the business they generate, including package upgrades, sale of recharge coupons etc..

However, what is notable is that Dish TV has not mentioned installation-services as one of the duties that will be allotted to cable operators in its brochure aimed at cable operators.

Installation is one of the most lucrative service segments in the DTH value-chain, allowing a two-member crew to earn thousands of rupees a day.

The DTH operator has called cable operators for physical meetings to discuss its proposals. One such meeting is being held in Noida Film City near Delhi on June 16.

“The cable operator’s revenue will be related to the number of their DTH customers,” Dish TV said.

However, the offer is unlikely to lure many due to the fact that unlike in cable, DTH subscribers are free to have their recharge done through any merchant.

In cable TV, a subscriber has to pay his monthly charges only through the cable operator who provided the initial connection, while in DTH, subscribers are free to pay the monthly charges through any shop or even online.

Besides, upgrading of packages is done more easily by calling Dish TV’s call centre or through their customer service portal than by calling up the cable operator.

As a result, the role of the cable operator will not be as crucial in a DTH market as in a cable TV eco-system.

It is, however, not known whether Dish TV will offer a fixed percentage of all future revenue created by customers brought in by the cable operator — as happens in the cable industry.