The Government of India has announced new guidelines for Direct-to-Home Services (DTH) in the country, as well as updated licensing rules for DTH operators. The big changes in the new guidelines issued by the Ministry of Information and Broadcasting include those for the license term, infrastructure exchange, and foreign direct investment (FDI). These new changes come at a time when DTH operators offering live TV subscriptions are facing competition from video streaming platforms including Netflix, Amazon Video, Disney + Hotstar, Voot, Zee5, Sony Liv, Jio Cinema and Lionsgate Play, to name a few. In India, the main DTH services include Tata Sky, Dish TV, Dish TV-owned d2h, Airtel Xstream DTH, and Sun Direct.
The new guidelines state that DTH licenses will now be issued for a 20-year period, an increase from the current 10-year license period. When the license renewal is filed, it can be renewed for 10 years at a time. The license fee has also been revised down from 10% of Gross Income (GR) to 8% of Adjusted Gross Income (AGR) now, and the AGR will be calculated after deduction of GST from Gross Income (GR) of the DTH operator. It is expected that this reduction and change in the calculation of the license fee will allow DTH operators to invest more in quality of services and coverage, something that will directly benefit users. For how much and how soon, we do not know at this stage.
The new guidelines for DTH companies also state that DTH operators will now be able to share infrastructure. This will be limited to sharing common hardware for your Subscriber Management System (SMS) and Conditional Access System (CAS) applications for DTH operators willing to share infrastructure. This infrastructure and system sharing, if DTH operators reach agreements for this, will help reduce not only network and operations costs, but also allow optimal use of satellite resources. DTH services rely heavily on satellite transponders to host channels and then transmit them to subscribers in India. The reduction in costs, including satellite transponder space rentals, may give DTH companies better margins to play with, and we could see a lower cost for subscribers, particularly new ones who also need to buy a new set-top box ( STB). .
However, please note that this guide does not refer to any type of set-top box portability, nor does it allow users to switch DTH services without having to change their STB. As it stands, you will need to purchase a dedicated STB from a DTH provider if you want to subscribe to a DTH service or change services.
Foreign direct investment (FDI) in the DTH sector, currently capped at 49%, will now be tied to common hardware for its Subscriber Management System (SMS) and Conditional Access System (CAS) applications. This means that the DTH sector can take advantage of 100% FDI, which should attract more foreign investment to India, as well as more players with larger investment plans that lead to more competition and better services, as well as prices. more competitive for consumers.
“DTH works all over India. The DTH sector is a very employment intensive sector. It directly employs DTH operators as well as call center operators, as well as indirectly employing a significant number of installers at the grassroots level. The amended DTH guidelines, with a longer license period and clarity on renewals, relaxed FDI limits, etc., will ensure a fair degree of stability and new investments in the DTH sector along with employment opportunities, ”says the ministry in a press release, highlighting the importance of the DTH sector in generating employment throughout the country.
Industry reaction has been positive to the new guidelines for DTH operators and services in India. “We thank Shri Javadekar for resolving the long-standing deadlock in DTH licensing policy that will provide certainty to the industry. We expect a level playing field through license fee parity with cable TV, which is also MIB licensed and follows the same prices and margins regulated by TRAI’s NTO, ”says Harit Nagpal, MD & CEO , Tata Sky, in a statement. shared with News18.
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