WELINGKAR INSTITUTE OF MANAGEMENT RESEARCH & DEVELOPMENT SUMMER PROJECT ON Indepth analysis of the D2H industry on behalf of Videocon and handling Brand promotions and events for Planet M (Research on “India has 6 major DTH players whereas the world over every country has approx 2. Can the Indian market absorb all? ” done to develop the Videocon brand name Handling Planet M brand promotions and a major event called “Mirchi Create With Agnee” in collaboration with Radio Mirchi) BY ESHA SYLVIA BAILEY PGDM 2009 – 11 Marketing TRIMESTER IV ROLL NO 9 Table of Contents
Industry Overview6 History:6 GLOBAL SCENARIO8 Current Indian Scenario:9 VIDEOCON INDUSTRIES LTD. 12 Objectives of the project:16 EXECUTIVE SUMMARY17 Porter’s Analysis of the DTH industry:19 SWOT Analysis21 Concept of growth share matrix (BCG model)23 List of major players in the industry24 Brief profile of players in the industry24 Cable Vs. DTH – An Overview of the World Scenario29 GROWTH OF THE INDUSTRY33 Comparative analysis of the DTH players38 TRAI Rules49 Problems experienced with Videocon D2H and their solution51 CONCLUSION:53 PLANET M54 HISTORY:55
TASKS DONE DURING THE INTERNSHIP58 IN DEPTH STORE ANALYSIS66 CONCULSION:71 REFERENCES72 Industry Overview History: The history of Indian Television dates back to the launch of Doordarshan, the Country’s national television network in 1959 when the transmission was in black & white. The 9th Asian games, held in 1982 in the country’s capital New Delhi, heralded the mark of colour television broadcast in India. In 1991, Indian economy was liberalized from the license raj and major initiatives like inviting FDI, deregulation of domestic businesses emerged.
This led to the influx of foreign channels like Star TV and creation of domestic satellite channels like Sun TV and Zee TV. This virtually destroyed the monopoly held by Doordarshan. In 1992, the cable TV industry started which changed the way the average Indian watches television. Every city in India had a new breed of entrepreneurs called as cablewalas or Local Cable Operators (LCO) taking in charge of distribution. Since this was a disorganized sector carrying new channels on the existing infrastructure required new investments which the operators were reluctant to make.
This led to the emergence of a new breed of firms called as Multi System Operators (MSO) who had heavy financial muscles to make capital investments and liaised between the cable operators and the channels. MSOs provide the feed to the local operators for a fee. In 1995, government felt the need of regulation in Cable TV and passed the Cable TV network (Regulation) Act. This was also the time when the state owned Doordarshan and All India Radio came under a new holding called as Prasar Bharati to give them enough autonomy.
The LCOs reported a lower number of connections where as the broadcasters demanded a higher rate. MSOs were finding it difficult to operate under these conditions. This led to an amendment of the Cable TV networks (Regulation) Act in 2002 to provide Conditional Access System (CAS). With CAS, the last mile distribution could be addressable with accuracy and digitalization of broadcast was also possible. CAS was rolled out in 2003 starting from Chennai and later to parts of Delhi, Mumbai and Kolkata. On the DTH front, TRAI issued the guidelines for operating DTH.
Country’s first DTH license was awarded to Dish TV in 2003 which started operations in 2004. Prasar Bharati also started its product DD-Direct+ In 2007, TRAI proposed a new initiative by called “Headend-In-The-Sky (HITS)” model as an alternative to the existing cable distribution. Instead of the MSOs providing the bundle, there will be a single HITS operator who will prepare the bundle of channels and beam it to the Headend in the satellite. With the average Indian getting younger, and hence more likely to spend on nonessentials, the entertainment industry has the potential to grow explosively in the future.
Now the industry is ready to enter a second stage of growth powered by the twin engines of technology (availability of quality infrastructure and the accelerated penetration of digital connectivity) and an enabling regulatory environment. GLOBAL SCENARIO”India will become the largest DTH market in the world in terms of subscribers by 2012, overtaking the United States” India is poised to become the world’s largest direct-to-home (DTH) satellite pay TV market with 36. 1 million subscribers by 2012,| overtaking the US, a report by research firm Media Partners Asia (MPA) says.
In its report titled ‘Asia Pacific Pay-TV and Broadband Markets 2010’, MPA said India’s DTH subscriber base will increase from 17 million in 2009 to 45 million by 2014 and 58 million by 2020. The industry sales is expected to grow to $12. 1 billion by 2014 and touch $18. 5 billion by 2020, it said adding that most DTH players will start making money after 2013. The DTH operators today are toiling under a heavy tax regime and subsidies given to customers on the new set-top boxes. The Indian pay-TV sector (DTH and cable) generated sales of $6. billion in the last financial year ended March 2010, which is expected to grow to $12. 1 billion by 2014 and $18. 5 billion by 2020, MPA said. “We are more positive on India’s DTH opportunity than previously, especially when anchored to consolidation and improved pricing power with continued growth,” MPA Executive Director Vivek Couto said. “We suspect the DTH market will consolidate from six to four platforms within three to five years, and the estimate four will be making money at the EBITDA level by financial year ended March 2013,” he added.
MPA expects competition to remain intense as the tug-of- war for customer acquisition shifts to regional markets. “The major risk to all our growth assumptions is regulation, which continues to commoditise and destroy industry value,” Couto said. Pay-TV subscriber base is projected to grow from 105 million in 2009 to 149 million by 2014 and 173 million by 2020. While cable will retain 70 per cent market share by 2014, it is expected to decline to 64 per cent by 2020, with DTH scaling up to almost 35 per cent share in the long-term. Current Indian Scenario: The Direct to Home (DTH) According to Harsh Bijoor, a brand consultant, “Since Dish TV, the biggest market player on the Indian soil, has not scraped even five per cent of the pie, there is plenty left for other players to eat. ” Industry in India is in the throes of multifarious challenges and opportunities. The big game? is all about shaping up grandiose plans to master the winning rules to garner as much portion of the Indian DTH pie as possible by a handful of players.
Since the DTH space denotes „big value? , akin to the space occupied by television and telephony, inter-firm rivalries have thrown up price wars, discount schemes, procurement of transponders, ambitious targets for improving the subscription base, popular bouquet of channels, set top boxes with superior quality of videos, improving content, etc as a desperate means to entice the Indian viewer. A neat 20 per cent annual growth is being witnessed in the DTH sector in India with over 16 million households having digital pay-TV.
In the early 2008, five major players, Zee’s Dish TV, Tata Sky, Reliance ADAG,Sun Direct and Bharti Telemedia formed an umbrella body – DTH Operators Association of India (DOAI). Dish TV is the largest DTH provider with a subscriber base of around 5 million, Tata Sky, a DTH joint-venture Company between Star (owned by Rupert Murdoch) and the Tata Group (20:80), now has around 3. 4 million connections and the forecast for 2012 is that it will further increase to eight million, Sun Direct, the 80:20 JV between the Maran family and the Astro Group of Malaysia, over 2. 3 million, Big Tv about 1. million and Airtel Digital Tv about 0. 3 million subscribers (Source: Business Standard, May 1, 2009). According to sources, DD Direct Plus has a subscriber base of about 3-4 million subscribers, mostly in the remote corners of the country not connected by terrestrial or cable television. DTH operations in India could be enhanced if the dearth of satellite capacity is removed by increasing the number of available Ku-band transponders that at present is 12 on Insat 4A, which in turn would mean more channels for viewing. Tax burdens on DTH are another area of complaint for operators.
Around 40 per cent of revenues are siphoned off to pay taxes and license fee and another 12 per cent for services imposed by the Central government. Apart from this, there are entertainment taxes that differ from state to state. World DTH History In 1962 Telstar satellite relayed a television signal over North America, sparking off the satellite television revolution. India too experimented first with satellite television in the mid 1970s under the SITE programme and later in 1982 with the Doordarshan national network. The exponential growth of cable TV in India in the 1990s made us a part of the global satellite television revolution.
Now the stage is set in India for the next generation of satellite TV — Direct to Home broadcasting. Location and accessibility to the cable line no longer matters in a DTH scenario. That’s because the programmes are beamed directly to the television at home. DTH broadcasting uses the upper portion of KU band transponders in a satellite to send hundreds of channels for downlinking on earth. Using a mini parabolic receiving dish and an integrated satellite receiver decoder, a subscriber can connect directly to the satellite platform provider.
The receivers are commonly known as set top boxes and have proprietary encoding technology built into them. The downlink, from satellite to earth, operates at frequencies between 12. 2 and 12. 7 gigahertz. DTH was launched as a business in the UK in 1989 and is now a reality all over the world. In Europe the overall market share of DTH in 2004 was 21. 4 per cent of all TV homes, with the figure for Germany being almost 40 per cent. In Europe the main DTH platforms are Canal Digital, Viasat and UPC. The UK has had a number of providers over the years — Sky, British Satellite Broadcasting, BSkyB and now Sky Digital.
In South Africa, Multichoice is the DTH platform and Canada has two legal DBS services, ExpressVu and Star Choice. Japan has Sky Perfectv and Latin America’s main satellite service is Sky Television. Australia and New Zealand too have DTH with Foxtel, Optus and Sky Network Television. A new battle is now being waged in America. This is between the two major DTH providers — Directv and Dish Network. Currently, about 10 per cent of all households in America get their television entertainment through satellite. But with the advantages a satellite system has over cable, this number is expected to double in the coming years.
In 1994 Directv was the first entertainment service in the US to deliver all digital-quality, multi-channel TV programming to an 18-inch satellite dish as an alternative to cable. In the first year of service almost one million systems were sold. There are now over 10 million customers across America. Its only rival, Dish Network, was the first to offer two-way, high-speed internet access via satellite through Start Band and the first satellite TV system to offer over 500 channels of digital video, audio and data throughout the US.
Launched in December 1995, it reached its first million customers at the end of 1997. Headquartered in Englewood, Colorado, Dish Network is owned by EchoStar Communications Corporation, a public company with approximately 20,000 employees. Both companies are enticing potential subscribers with everything from free toasters to private trapeze lessons. For subscribers in the US, the decision is based on channels offered and the price. Directv offers over 225 channels, including a number of digital video recorder programming packages and local programming in all major cities and most metropolitan areas across the US.
A subscriber pays either $40 a month for 100 plus channels, including local channels, or about $88 a month for those same channels plus 30 premier movie channels. Dish Network offers the lowest price package of channels at $32 and all 180 plus regular channels plus 31-plus movie channels for $83 per month. Dish Network retailers even offer two free digital video recorders to each subscriber and install the system in up to four rooms of the house with no upfront fee. In programming choices, both networks have plenty of channels, but Directv has a few extra sports channels.
It also offers three to five South Asian channels, including Star India, for between $30 and $60 a month. Dish Network on the other hand offers Zee TV, Zee Cinema, Sony Entertainment TV, B4U and TV Asia for $25-50 a month. Both networks have introduced digital video recorders, a great new technology that lets subscribers view satellite TV when and how they want to. They can pause live TV to answer the phone and skip through commercials on recorded programmes, besides recording up to 100 hours of programming and more. A subscriber can even record two programmes at the same time.
The battle to grab more subscribers in the US continues unabated. With DTH making its appearance in India, there is likely to be a rice, programming and technology war to attract DTH subscribers. As in the US, let’s hope the consumer wins. VIDEOCON INDUSTRIES LTD. Videocon industries ltd. Headed by Mr. Venugopal N. Dhoot is a $4 million USD Conglomerate founded by Mr. Nandlal Madhavlal Dhoot in 1979. It has its headquarters in Aurangabad, Maharashtra, with basic operations in the field of colour picture tube manufacturing, oil & natural gas, and consumer durables.
The company deals in a vast product mix like consumer electronics, Home Appliances, Components, Office Automation, Mobile phones, Wireless, Internet, Petroleum and Satellite television. It has its presence in many parts of the world including India, china, Mexico, Italy, and Poland. It has recently started operations in countries like Oman, Australia and the Timor Sea near Indonesia. And It has 30% market share in india and was ranked 44 th in india in ‘Business India’s Super 100’. COLOUR PICTURE TUBE MANUFACTURING AND LCD’s :
Videocon holds the third position among the largest colour picture tube manufacturers in the world. They occupy 21% of the Indian market with only LG and Samsung leading the foray with 40% and 38%. the scope of business in the areas of LCD’s and plasmas is well understood by the chairman Mr. V. N. Dhoot, thus Videocon has recently diversified into the same. In the manufacturing of LCD’s the glass panels required are a major cost and as Videocon manufacturs such panels (with production equal to 19 million glass panels per annum) it becomes very easy for it to manufacture LCD’s at lower costs. Moreover the government grants a 25% subsidiary to LCD manufacturers. The acquisition of Thomson and Electrolux was also a major step for an Indian company, As not many Indian companies are able to acquire foreign firms with half the ease. Now Thompson holds a 15% stake (for an investment of Rs. 2686. 8 Cr) and electrolux holds a 5% stake in the firm. Videocon grew its manufacturing business by taking advantage of policy-friendly locations. Aurangabad, for instance, is classified under Zone ‘D’ under the Special Industrial Development Zones Scheme.
The Aurangabad factory allows an exemption till 2017, This, over the years, works out to a tax benefit of 135 per cent on investment. Eleven of our 12 factories in nine states are based on exemptions past and present. Seventy per cent of our sales come from locations that are exempt from sales tax. this way, Videocon saves around Rs 200 crore in taxes every year. OIL & NATURAL GAS An important asset for the group is its Ravva oil field on the cost of andra Pradesh with one of the lowest operating costs in the world producing 50,000 barrels of oil per day. The firm has also started operations in oman.
CONSUMER DURABLES In India the group sells consumer products like Colour Televisions, Washing Machines, Air Conditioners, Refrigerators, Microwave ovens and many other home appliances, selling them through a Multi-Brand strategy with the largest sales and service network in India. Videocon Group brands include Akai, Electrolux, Hyundai, Kelvinator, Kenstar, Kenwood, Next, Planet M, Sansui, Toshibha, Philips (TV Products) etc. Their recent venture has been in mobile phones and telecommunication services and in DTH services known as D2H. FINANCIALS It is listed in the BSE as 511389.
The Videocon group has an annual turnover of US $4. 1 billion and a Net income of US $276 million, making it one of the largest consumer electronic and home appliance companies in India. In the quarter ending Dec’ 09, Videocon had sales of 11886 Cr, compared to a sales of 12172 Cr in 2007-08. Thus the company encountered a 2. 35% loss in sales last year majorly due to the recession. Its PAT (profit after tax) for Dec 09 was 1098 Cr as compared to last year’s profit of 706 Cr. This showed a drastic increase in profits upto 55. 57% since the last year. Moreover the NFA (net fixed assets) increased by 1731. 7% over the last year and became 9074 Cr. And the market capitalization stood at 5389 Cr. SOCIAL INITIATIVES Videocon understands that giving back to the society is as important as making profits. The chairman Mr. Dhoot belives that one must give back to the society in such ways that the benefits gained out of such charity are long lasting and not short lived. The charity must also help in furthering the economic development of the country. Thus instead of huge monetary donations Videocon has built schools and hospitals with world class facilities which cater to the under privileged. PRODUCT MIX
Videocon has a wide array of products ranging from consumer durables, home appliances and components. These are mentioned below: Consumer Durables * Mobile phones * CRT TV * Plasma TV * LCD TV * Home entertainment systems * Audio/video products Home appliances * Washing machines * D2H * AC * Air coolers * Mixers toaster * Iron * Microwave * Vacuum cleaners * Water purifiers * Refrigerators Displays * Plasma panel * CPT * LCD panel Components * Glass * Panels * Funnels * Compressors * Plastic * Motors * Mouldings * Packaging They have their manufacturing facilitries in the following countries
Manufacturing Facilities INDIA (7) CHINA (2) ITALY MEXICO POLAND OMAN Figure in bracket indicate the number of manufacturing facilities in that country. Introduction to Bharat Business Channel Limited (BBCL): Videocon Group is launching Direct To Home services & Mobile Handsets in India under the banner of BBCL (Bharat Business Channel Limited) with brand name of Videocon d2h. DTH stands for Direct To Home which is a direct mode of transmission between Broadcaster? and, Subscriber through satellite.
Broadcast centre collects the signals from different programming sources (like Sony, Zee, and Star). It processes the Signals and beams it to the Satellite. Satellite will reprocess the signals and retransmits the signal to the subscribers. Objectives of the project: * Study the global DTH market of prominent countries. * Their origin * Growth * And current trends * In depth analysis of DTH industry through the porters model. * SWOT Analysis * Make a BCG Matrix for the same. * Study the Indian DTH market and enumerate the top players * Do a comparative study of the various DTH players Check the current penetration of Videocon DTH and its competitors. * A study of TRAI rules pertaining to the DTH industry to understand its governance. * Cable TV v/s DTH * Track the growth of the Indian DTH industry * Track Videocon’s Growth, technology, Logistics, Labor ,Marketing, Strategies , Competitors EXECUTIVE SUMMARY This project has been made by assimilating the work done in two companies namely Videocon and Planet M. the project initially started for the Videocon D2H industry wherein an in depth analysis of the industry and its players was done both on a global and Indian level.
But because this did not take as much time as was thought to a different project was also taken up in Planet M (sister concern of Videocon) to manage time more effectively. While the project in Videocon delves into the question of weather India can accommodate 6 DTH players or not, as there are an average of 2 to 3 prominent player per country in the global market, the Planet M project was more on the lines of doing events and Brand promotions to increase and maintain foot fall and sales. VIDEOCON: The question put forward was a very precise one.
Though DTH has evolved recently in India the number of players in the industry are fairly large. When researched, It was found that the global market place has a majority of countries which have an average of 3 prominent players in the DTH industry. This was entirely contradictory to India’s situation where there are 6 prominent players present in the industry. On further analysis it was evident that because of the level of profits and the low entry barriers many more players could easily join this foray. India is expected to surpass the US DTH customer base by 2012 even though the market penetration of the DTH industry is very low.
This makes it clear that there is enough for everyone to feast on. And with the ever growing population statistics answering this question will not be difficult. To analyse the question at hand and its varying outcomes an analysis of the global market was done. Then the Indian market was targeted and a study on the Indian DTH industry was carried forward by doing the porters five force analysis, making the BCG matrix and doing a SWOT analysis. Then a comparative analysis of the various DTH players in India was done to find out who is better and which brand is demanded the most and why.
The individual Advantages and disadvantages of every player in the Indian market was also done. After the comparisons were over the common problems with Videocon D2H were enumerated and solved, following a conclusion to the report. The conclusion was that india can accommodate these 6 players with ease, as the market penetration of these services has not yet reached saturation and the convenience of satellite connections over wires is a welcome change. PLANET M: Planet M is a youth brand focusing on their needs, wants and likes.
Being a medium level retailing firm it struggles with the common retailing problems like moderate cash flows, low customer retention and the need to innovate the products and schemes very often. An effective defence mechanism adopted by Planet M is its ability to evolve and distinguish itself from its competitors. It is one firm which comes up with new and attractive schemes to increase foot fall and sales, and that is it biggest strengths. Planet M organizes an event every weekend to promote young talent. It even has many schemes which are instrumental in its growing demand and higher profits.
Some of its schemes are the ‘48 hour price challenge’, ‘*60% off’, ‘ek ke saath ek free’ etc. The essence of this project revolves around the working and the strategies of the firm. As mentioned above Planet M organizes events to create brand awareness and hype, and this is precisely what was done during the making of this project. Being a part of the marketing team I handled events and promotions which was an exquisite experience. These include events for Planet M, event in collaboration with Radio Mirchi ‘Mirchi Create With Agnee’, Michel Jackson promotion which paid a tribute to MJ etc.
Porter’s Analysis of the DTH industry: 1. Threat of substitutes: DTH faces stiff competition from the terrestrial, cable and IPTV. As per the industry estimates, there are 130 million TV homes of which 85 million are served by cable and around 16 million by DTH with the remaining taken by terrestrial transmission. Terrestrial Television: Doordarshan is the world? s largest terrestrial broadcaster with over 1400 terrestrial TV transmitters. The reach provided by this route is phenomenal with Doordarshan covering 88% of India? s geographical area.
Covering the remaining 12% area required substantial capital investments which does not outweigh the benefits. The transmission was done originally in Analog mode but beginning from 2002, Doordarshan has partnered with BBC resources – the consulting wing of BBC, in offering digital terrestrial TV. The transmission could be received using a low cost Yagi antenna. However, due to lack of attractive content it does not seem to be a formidable threat for DTH. Cable TV: Cable TV currently operates in 2 modes viz. through CAS covering cities like Chennai, Delhi, Mumbai and Kolkatta, and through non-addressable system in the rest of the country.
As seen from the above diagram Cable TV enjoys the maximum share as compared to other medium. In case of CAS controlled areas, the subscriber has to buy Set Top Box (STB) to see the pay channels. On the other hand, in areas where non-addressable system is used, nearly all the channels are available without the need of any separate receiver by paying anywhere between Rs 100 to Rs 350 per month depending on the place. Due to phenomenal reach of Cable TV, it poses a serious threat to the growth of DTH industry. Internet Protocol Television (IPTV):
IPTV is a service where television signals are digitally sent over the telecommunications line. It is often presented as a bouquet of Video (IPTV), Audio (Telephone) and Data (Broadband Internet) services. With widespread adoption of broadband in the country and the growing techno savvy population, IPTV has a potential to become a huge success. IPTV takes the interactivity to a newer level. In regular mediums, all the channels are pushed to the consumer regardless of his preference. IPTV encourages a two-way request response model where the consumer chooses the programs he wants to view.
Right now thos medium is totally unregulated and cable companies are urging the TRAI to issue a consultation paper process to include IPTV under the aegis of Cable TV act. IPTV is a considerable threat to DTH in urban and semi urban areas where broadband has made its mark. 2. Bargaining power of suppliers: DTH industry relies on three major supplies: Customer Premise Equipment (CPE) comprising of the satellite dish, Set Top Box with the necessary Access card, the Ku band transponders in the orbiting satellites and content. With India overtaking Japan as Asia? largest DTH, the bargaining power of Indian DTH operators with CPE supplies have increased. However, the availability of transponders is increasingly becoming difficult. The Ku band transponder is generally provided by Astrix, the commercial wing of ISRO either through its own satellites or by leasing transponders from suppliers. With only two domestic satellite launches between 2007 and 2010 an d increasing DTH players, Astrix is in a better position to use DTH as its cash cow for the next 5 to 10 years. Also the crash of INSAT 4C and NSS-8 has worsened the situation of DTH players.
As there is not much of regulation particularly in terms of channel pricing, acquiring content from the broadcasters is also difficult. DTH vendors are at the mercy of the broadcasters. 3. Bargaining power of buyers: With enough options to choose both from the pont of alternate mediums like Cable, IPTV and Terrestrial broadcast and from the point of increasing DTH operators, the consumer is at his will to decide. Customers will continue to have a high bargaining power until DTH platforms try to differentiate them as superior players with better content and clarity 4. Inter firm rivalry:
With 6 operational players, the inter firm rivalry is quite high. The competition from state owned DD-Direct to private players is negligible from the content point of view as the number of channels offered by DD-Direct is very limited. However, DD-Direct does not charge any monthly subscription fee which poses a threat to the private players. Between Dish TV and Tata Sky there is an intense rivalry exhibited by price wars and discount schemes offered to new connections. Being the first mover, Dish TV has price advantage in both the STB as well as procuring the transponders.
On the other hand, Tata Sky claims its STB having superior DVD quality video. Other than price wars and intense competition in increasing customer base, there is also a competition at acquiring the content. Dish TV, Tata Sky and Sun Direct are part of big groups that also have popular bouquet of channels like Zee, Star and Sun respectively. The channels indirectly refuse content for DTH operators by charging exorbitantly or mandating that all the channels of their bouquet to be transmitted when the vendor is already capacity constraint. 5. Threat of new entrants:
With already 6 players in the DTH space, threat of new entrants is relatively low. There is already enough competition which will discourage new firms to enter this business. While getting a license is relatively easy, the barriers to entry are high when it comes to pricing of CPE and getting the required transponders. SWOT Analysis STRENGHT Growing number of player and competitive advantage. Supply creates its own demand. Brand name Service and flexibility. WEAKNESS Skilled labor Satellite technology Signals Viewer migration. Uncertainty in viewer ship. OPPORTUNITY Technology Distribution
Innovation Value adding THREAT Economic downturn. Climate Radio Cinema halls Broad casting of channels New entrants Concept of growth share matrix (BCG model) The BCG – GROWTH SHARE MATRIX is a portfolio planning model developed by Bruce Henderson of the Boston Consulting Group in the early 1970’s. It is based on the observation that a company’s business units can be classified into four categories based on combinations of market growth and market share relative to the largest competitor, hence the name” growth share”. Under the BCG GROWTH-SHARE MATRIX, as an industry matures and its growth rate eclines, a business unit will become either a cash cow or a dog, determined solely by whether it had become the market leader during the period of high growth. While originally developed as a model for resource allocation among the various business units in a corporation, the growth-share matrix also can be used for resource allocation among products within a single business unit. In the DTH industry when the market share is obtained then it is automatically treated as the market leader, and also it needs maximum market share to extent, when the market is not in incremental state then the growth rate of the industry will retain.
Again this industry follows all the variables in the all areas till the both will come into normal level. The Indian DTH marketre of the Indian DTH industry The structure of the DTH industry in India can be categorized as an “Oligopoly”. An oligopoly is a market form in which a market or industry is dominated by a small number of sellers (oligopolists). An oligopoly is a market dominated by a few large suppliers. The degree ofmarket concentration is very high. Firms within an oligopoly produce branded products and there are also barriers to entry. Key characteristics of “Oligopoly” are following: * Few larger supplier dominates the market Interdependence between firms * Each firm produces branded products * Significant entry barriers into the market in the long run which allows firms to make supernormal profits * Each oligopolist is aware of the actions of the others List of major players in the industry 1. Doordarshan – (DD-Direct +) of Prasar Bharati comprising of 33 FTA channels and 12 All India Radio Channels. 2. Dish TV of ZEE group. 3. Tata Sky joined venture between Tata and Rupert Murdoch’s Sky TV. 4. Sun direct of Sun Network. 5. BIG TV of Reliance Anil Dhirubhai Ambani group. 6. Airtel digital TV of Bharati telemedia 7. Videocon d2h of videocon industries
Categorization of players in the industry Government owned player: DD Direct+. Private players: Dish TV, Tata Sky, Sun direct, Big TV, Airtel digital TV, Videocon d2h Brief profile of players in the industry DD DIRECT+ Doordarshan is the public television broadcaster of India and a division of Prasar Bharati, a public service broadcaster nominated by the Government of India. It is one of the largest broadcasting organizations in the world in terms of the infrastructure of studios and transmitters. Recently, it has also started Digital Terrestrial Transmitters. On September 15 2009, doordarshan celebrated its 50th anniversary.
Doordarshan had a modest beginning with the experimental telecast starting in Delhi on 15 September 1959 with a small transmitter and a makeshift studio. The regular daily transmission started in 1965 as a part of All India Radio. The television service was extended to Bombay (now Mumbai) and Amritsar in 1972. Till 1975, seven Indian cities had television service and Doordarshan remained the only television channel in India. Television services were separated from radio in 1976. Each office of All India Radio and Doordarshan were placed under the management of two separate Director Generals in New Delhi.
Finally Doordarshan as a National Broadcaster came into existence. National telecasts were introduced in 1982. In the same year, color TV was introduced in the Indian market with the live telecast of the Independence Day speech by then Prime Minister Indira Gandhi on 15 August 1982, followed by the 1982 Asian Games being held in Delhi. Now more than 90 percent of the Indian population can receive Doordarshan (DD National) programmes through a network of nearly 1400 terrestrial transmitters and about 46 Doordarshan studios produce TV programs today.
DD Direct+ is a free Direct to Home (DTH) service that provides satellite television and audio programming to households and businesses in the Indian subcontinent. Owned by parent company Doordarshan, DD Direct Plus was launched on December 16, 2004. Now chairman of DD plus+ is Shri Arun Bhatnagar and CEO is B S Lalli under the ministry of information and broadcasting. Dish TV Dish TV is the first private DTH satellite television provider in India, using MPEG-2 digital compression technology, transmitting using NSS Satellite at 95. 0.
Dish TV’s managing director and Head of Business is Jawahar Goel who is also the promoter of Essel Group and is also the President of Indian Broadcasting Foundation and Mr. Subhash Chandra is the Chairman of Dish TV. Dish TV is a division of Zee Network Enterprise (Essel Group Venture). EGV has national and global presence with business interests in media programming, broadcasting & distribution, speciality packaging and entertainment. Zee Network incorporated dishtv to modernize TV viewing. By digitalizing Indian entertainment, this enterprise brought best television viewing technology to the living room.
It not only transmits high quality programmes through satellite; but also gives a complete control of selecting channels and paying DTH service was launched back in 2004 by launching of Dish TV by Essel Group’s Enterprises. Dish TV is on the same satellite where DD Direct+ is. Dish TV started its service in Pakistan with the collaboration of Budget Communication. Dish TV was only DTH operator in India to carry the two Turner channels, Turner Classic Movies and Boomerang. Both the channels were removed from the platform due to unknown reasons in March 2009. Dish TV uses NSS-6 to broadcast its programmes.
NSS-6 was launched on 17 December, 2002 by European-based satellite provider, New Skies. Dish TV hopped on to NSS-6 from an INSAT satellite in July 2004. The change in the satellite was to increase the channel offering as NSS 6 offered more transponder capacity. Tata Sky Tata Sky is a DTH satellite television provider in India, using MPEG-2 digital compression technology, transmitting using INSAT 4A at 83. 0°. Tata sky is incorporated in 2004; Tata Sky is a JV between the TATA Group and STAR. Tata Sky DTH endeavors to offer Indian viewers a world-class television viewing experience through its satellite television service.
Vikram Kaushik is present CEO of Tata Sky Ltd. The TATA Group is one of India’s largest and most respected business conglomerates. It comprises 93 operating companies in seven business sectors and diversified group: information systems and communications, engineering, materials, services, energy, consumer products and chemicals. The TATA Group has operations in more than 40 countries across six continents and its companies export products and services to 140 nations. The Group and its enterprises have been steadfast and distinctive in its adherence to business ethics and their commitment to corporate social responsibility.
This is a legacy that has earned the Group the trust of many millions of stakeholders in measure few business houses anywhere in the world can match. The SKY brand, owned by the UK-based British Sky Broadcasting Group, brings to Tata Sky the reputation of more than 20 years experience of satellite broadcasting. SKY is well known for the innovative products and services launched by BSky, such as DTH broadcasting in 1989, digital satellite broadcasting in 1998, interactive television services in 1999 and the SKY+ personal video recorder in 2001.
Tata Sky joins an international group of DTH businesses that includes platforms as far apart as the UK and Italy in Europe, and Mexico and Brazil in Latin America. Tata Sky Ltd is the First Indian DTH provider to be awarded the ISO 27001:2005 accreditation, the ultimate benchmark for information security. The assessment for the certification was conducted by Intertek Systems Certification, the management systems registration business unit of Intertek Group plc and is accredited by several internationally-recognized accreditation bodies worldwide.
In October 2008, Tata Sky announced launching of DVR service Tata Sky+ which allowed 45 hours of recording in a MPEG-4 compatible Set Top Box. The remote is provided with playback control keys and is being sold with special offers for existing subscribers. Tata Sky was selected as a SUPER BRAND for the year 2009-2010 by an independent and voluntary council of experts known as Super brands Council. It is the only Indian DTH to have won this distinction. Sun Direct is a DTH satellite television provider in India, using MPEG-4 digital compression technology, transmitting using INSAT 4B at 93. 5°E.
It is the country’s first MPEG 4 technology DTH service provider. Sun Direct is a DTH service in India headquartered in Chennai, Tamil Nadu. Sun Direct TV was registered in February 16, 2005. However, the failed launch of INSAT 4C resulted in a lack of transponders, delaying the launch. The service was finally launched on December 2007 after availability of transponders from INSAT 4CR. Because of the lowest pricing of any DTH in India Sun Direct spread rapidly all over the country. On December Sun Direct was launched in Mumbai and announced its pan India launch. By 2009 it became leading DTH provider with 3 million subscribers.
This makes it 4th largest DTH service provider of India. In April 2009 Sun Direct officially launched its High-Definition service in India. Sun Direct uses the latest MPEG-4 based technology to increase broadcast capacity. Sun Direct provide next-generation services in fast-growing and emerging markets quickly and efficiently. Sun Direct selected Oracle based on its convergent multi-service capabilities and proven real-time scalability allowing it to consolidate billing operations, enables powerful new service offerings and improves visibility into customer information across services.
BIG TV Reliance BIG TV is a DTH satellite television provider in India based in Navi Mumbai, using MPEG-4 digital compression technology, transmitting using MEASAT-3 91. 5°east. It is the 5th DTH service launched in India. Reliance BIG TV limited is a part of Reliance Communications Ltd. , a subsidiary of Reliance Anil Dhirubhai Ambani Group founded by the Late Dhirubhai Ambani, the Indian business tycoon and owned by his son Anil Ambani. BIG TV started operations from 19 August 2008 with the slogan “TV ho Tho BIG Ho” (“If you have a TV, make it BIG”).
It currently offers close to 200 channels and many interactive ones, 32 cinema halls (i. e. Pay Per View Cinema Channels) as well as many Radio channels. The company plans to increase the number of channels in the near future to 400 and begin High Definition (HD) broadcast. It is the first Pan-India DTH provider that uses MPEG-4 for broadcasting. There are also plans to introduce services like i-Stock, i-News and other such interactive services in the future. Reliance BIG TV was launched on August 19, 2008 with the sole aim of providing the consumer with quality and enriched home entertainment service at value-driven pricing.
Reliance BIG TV’s launch in August was probably the biggest roll-out in home entertainment ever and deployed the most advanced MPEG4 technology that enabled them to deliver best quality digital audio-video to the consumer. It also got prepared for the future when Hi-Definition TV will be launched in India because only MPEG4 technology can support HD TV and not MPEG2 which is used by the earlier entrants in the DTH industry. Reliance BIG TV’s retailer network is spread across 100,000 outlets in 6,500 towns in India. This was literally unheard of in the DTH industry. They had effectively out-stripped the competition here.
When it came to pricing – packaging, their introductory offer stood at Rs. 1,490/- with 3 to 6 months of free subscription. They also introduced 32 Pay-Per-View Movie Channels, the highest by any DTH player. Airtel digital TV Bharti Airtel Limited is the flagship company of Bharti Enterprises and is India’s largest integrated and the first private telecom services provider with a footprint in all the 23 telecom circles. As India’s leading telecommunications company, the Airtel brand has played the role of a major catalyst in India’s reforms, contributing to its economic resurgence.
Airtel since its inception has been at the forefront of technology and has steered the course of the telecom sector in the country with its world class products and services. Airtel Digital TV is a DTH (Direct to Home) service from Bharti Airtel. It uses MPEG-4 digital compression with DVB-S2 technology, transmitting using INSAT 4CR 74°E. Airtel digital launched on 8 October, 2008 with a 360 degree mega campaign ‘Come Home to the Magic. Since then it has launched 2 other campaigns: ‘Stars come home’ (March 2009) and ‘DTH Picture Clarity (August 2009) has increased its channel base to 183+ channels.
Airtel digital TV is now amongst the fastest growing DTH brands in the country and is available across 5000+ towns in India. It has also been ranked as the best DTH service by “Living Digital” magazine. Airtel chief Sunil Mittal said that Airtel digital TV and other DTH players have a bright future in Indian market as the people are getting more attracted towards DTH because of its quality and affordability. Videocon d2h Videocon d2h is a DTH satellite television provider in India based in Mumbai, using MPEG-4 with DVB S2 digital compression technology.
Videocon Leasing & Industrial Finance Limited was incorporated on 4th September, 1986 as Adhigam Trading Private Limited. In terms of the necessary resolutions Passed under Sec. 21 of the Companies Act, 1956, the name of the company was changed to Videocon Leasing & Industrial Finance Limited on 14th February, 1991. The Company received a fresh certificate of incorporation from the Registrar of Companies, Gujarat at Ahmedabad on 14thFebruary, 1991. Videocon d2h launched May 1, 2009. it came with a very good strategy for selling both of its electronic products like TV’s DVD’s along with the new set top box.
This is offering direct to TV without any set top box also. Only the antenna is enough, it also came with DVD which is connected directly to the TV or antenna is connected to DVD which gives a best quality of output. Cable Vs. DTH – An Overview of the World Scenario In the wake of the opening up of the earth and skies (literally) to private operators, India is all set to see a “war of the accesses”. With very few large players, a widespread geography and an extremely rowdy and unorganised cable operator set-up, the options between DTH and Cable as access modes are both set to woo the ever increasingly discerning Indian consumer.
This part attempts to provide an overview of the world scenario and draw some parallel (if any) to our country. I have tried to collate information from various countries, all in different stages of “access provision” development. Canada Cable competition has increased in Canada in the past few years due to changes in technology and government regulations. There have been delays, however, in launching direct broadcasting services (DBS), largely due to restrictions against non-Canadian programming – 51 per cent of channels carried on cable and DTH must be Canadian programming.
As a result, a “gray market” exists: subscribers illegally using US made dishes and receiving US satellite signals. Despite the popularity of the dishes, Canadian DBS consumers basically face the same problems as US consumers: 1) Lack of local broadcast signals, 2) expensive equipment and installation, 3) zoning laws and tenant restrictions against mounting dishes, and 4) digital converters necessary for each TV set (and additions are costly). As in the US, the main factors affecting consumer choice between cable and DBS are programming choices, cost, and signal quality.
In major markets, DBS offers a few local channels but cable still has the advantage. As in the US, Canadian cable operators plan to compete with DBS via new services, i. e. internet, digital and telephony. Despite competition from DBS and other subscription video services such as wireless, cable penetration has increased in the past few years, from 65. 3% in 1994 to 67. 8% in 1996. Competition in Canada is likely to increase overall multichannel subscribership, but cable has an advantage due to price and local programming. Latin America
Latin America has approximately 13. 4 million multi-channel subscribers with an overall penetration rate of 15 per cent. The problem with piracy has started to improve as thousands of cable licenses are being granted across the region. Deregulation of both cable and telecommunications is bringing foreign investment into Latin America, especially from the US, Canada and Europe. Consolidation and acquisition is necessary in order to upgrade cable networks to provide cable telephony and other new services. Smaller cable and MMDS systems are being acquired by the major MSOs.
DBS has provided further impetus for cable operators to upgrade, with their digital packages providing 150 and more channels compared to 50 on cable. There were 487,000 subscribers to DBS in 1997, with 3. 2 million forecast by 2002. Due to its high cable penetration rate, DBS growth in Argentina may be limited. Regulations and pricing have slowed DBS progress – equipment costs and programming packages are expensive for the average consumer. Overall, DBS is not a major threat to the cable industry in Latin America, especially with many MSOs becoming DBS distributors in their countries.
Europe Cable companies around Europe are consolidating in order to upgrade their networks to provide digital, interactive and telephony services in Europe. Cable telephony is already in service in the UK and Scandinavia and is cable companies’ biggest strategy against DTH in those countries. In fact, in the UK, cable telephony revenues are surpassing cable television’s. Cable television has over 30 million subscribers in Europe, but DTH is no idle threat with 17 million. Germany leads the region in both cable and DTH subscription with 28 million subscribers in both.
Cable television has been in the U. K. since the early 1980s when the first franchises were awarded. In 1990, DTH services were launched with BSB and Sky – they were not successful and merged. Significant consolidation has taken place and today there are some half dozen cable operators. The UK has more DTH households than cable with a penetration rate of 15. 9% vs. 11. 8%. In Eastern Europe there is a high penetration of analog DTH compared to cable, but nothing much happening in digital either way so far. Sub-Saharan Africa It is difficult to predict the future for television in Africa.
The liberalization of broadcasting regulations and the increasing penetration of low cost DTH technology have led to significant growth in Africa’s television market. In November 1995, Multi-choice was launched and continues to dominate the African DTH market. Multi-choice claims over 1. 1 million subscribers, and even far-away places such as Zambia are receiving Multichoice’s M-Net channels and have as many as 4,800 subscribers. The challenges, however, facing the African DTH market can be identified by a lack of funds, technological discrepancies or government intervention.
DTH seems to be the most economical method of reaching widespread population, however it is also faced with the challenge of providing services to a country having over 60 dialects and widespread population that may have no interest nor means in paying for a satellite service because of its cost. Middle East The Middle East, with a population of over 165 million and over 26 million television homes, demonstrates a market with significant potential. However, it remains a market where only a small minority actually pays for what they watch on TV.
Cable TV is experiencing growth first beginning in Israel but Qatar has 12 channels available, while Bahrain and the UAE both have ten. The multi-channel alternatives, satellite and MMDS, are increasingly important, though in some states such as Qatar they are mutually exclusive. The satellite TV sector exploded after the Gulf War with the launch of services such as ESC (Egypt) and MBC (UK) in 1991, EDTV (Dubai, UAE) in 1992, Abu Dhabi in 1994, LBCI, FTV (Lebanon) and Al Jazeera (Qatar) in 1996 and ANN, a Syrian-owned channel broadcast via London, in 1997.
The consumer taste for variety and polished programming packages has laid the foundation for the conversion from over-the-air broadcasting to pay TV. The challenge to becoming a successful operator in the Middle East lies in the provider’s ability to offer a unique product while adhering to the cultural and religious sensitivities of the market. Satellite penetration is as high as 27% in Saudi Arabia and as low as 6% in Lebanon. Because of this widespread difference, it can be argued that MMDS will become the dominant medium for pay TV.
Star TV, for example, is marketing the MMDS network in Qatar, Dubai and Bahrain. Finally, the Middle Eastern television viewer has yet to come to terms with actually paying for quality entertainment, but time will tell what will happen. Asia and the Pacific Broadcasting in Asia continues to grow by leaps and bounds. Penetration is consistently on the rise with DTH and cable penetration currently reaching one in five TV households and estimated to reach one in three households by 2005.
In 1991, the first subscription DTH service was launched which led the way in the Asian satellite revolution. Growth is expected in cable, MMDS as well as DTH to meet consumer demand which is likely to rebound strongly after the current turmoil recedes. Which technology prevails in each market is likely to be determined by a combination of factors including geography, which technologies were first established, which players have the most “political clout”, etc. Concentration of population and income level will dictate the ease in which a consumer can access a pay TV service.
Australia In July 1997, the telecommunications market in Australia was deregulated allowing new carriers to compete directly with the two incumbent carriers, Telstra and Optus. Australia is also a unique study in cable, because it is one of the few countries in the world where competing services are laying fibre-optic cable and hanging it overhead simultaneously. The road to convergence in Australia has also not been a smooth one. The services vying for the ability to provide cable, telephony and data transmission all in one are experiencing losses at an alarming rate.
Cable is in a state of overbuild with over 1 million homes already passed. It also seems that these competing cable companies are readily accepting losses in order to gain market dominance. Attempts to merge these systems have been repeatedly foiled by Australia’s anti-trust regulator, the ACCC. Just what the future holds for Australia is unpredictable but one thing is certain, opportunities exist for the large and knowledgeable participant in traditional media and television, while emerging technologies and convergence opportunities will arise with the deregulation of the telecommunications sector.
India India is a dynamic study in itself. Just ten years ago, about 20 per cent of the total homes could only receive government services broadcast on one channel operated by Doordarshan, the national television operator. By 1997 there were 50 private satellite channels and 19 different services from a revitalised Doordarshan. One-third of the homes now have television and about 10 per cent of the total homes subscribe to cable.
The most significant event in the cable sector was the passage of the Cable Television Ordinance Law in January 1995. This ordinance requires the registration of cable operators and mandated technical standards that required most operators to upgrade their systems in addition to issues regarding content. This legislation has ended the “cottage industry or small scale industry,” at least in the secondary cities. At one time there were over 100,000 cable operators in India, but that number has since been reduced to 60,000 networks.
Many operators wishing to avoid the obligation of paying steep entertainment taxes, which can be as high as 30 to 40%, or the cost to upgrade their systems are selling out to emerging MSOs such as Siti Cable and In Cablenet or forming alliances to compete with larger MSOs. The challenge for cable exists in the rural areas where installation and application are extremely cost prohibitive, and nearly three quarters of India is designated as rural territory. This has created an opportunity for DTH, which serves an immediate threat to the high-end cable networks. Some of the key player who have shown an interest in operating a DTH service are he Star, Zee Telefilms (the Subhash-promoted group has decidedly cooled off on it though) and the Modi Group. Two or three other DTH packages are expected to launch in 2002, and package choice is likely to increase subscription rates in the medium term, although different marketing techniques may generate confusion as the benefits vary from package to package. DTH providers claim to target only the wealthy rural population, although a high proportion of their subscribers will be the urban rich as well, many of whom already subscribe to the higher-end cable networks.
DTH, however, is faced with a lack of high quality programming, a lagging infrastructure for distribution and collection and technological barriers. However much like the USA the extremely high penetration of Cable in the Indian households would be a definite threat to the highly optimistic proponents of DTH in the country. Also, the MSOs are in an active drive to upgrade their existing networks in order to lay a backbone for the recently liberalised broadband industry.
Hence the cable operators seem to have won the first round of the battle by providing the consumer value additions in the form of high speed Internet and other services. GROWTH OF THE INDUSTRY Rate of Growth The DTH service market in India has emerged as one of the most lucrative markets which have successfully resisted the impacts of the current economic slowdown. The slowdown has certainly proved a boon for the Indian DTH industry as people have now started to cut on their entertainment expenditure and instead of viewing movies at theatres, they are preferring to stay at home with their television sets.
With the Indian economy growing at a GDP growth rate of 7. 4%, there is a sense of growth prevailing every where. The average Indian’s disposable income and purchasing has risen to never before levels. The industry is anticipated to add nearly 5 Lakh subscribers per month during 2009 and the numbers are forecasted to surge further at a CAGR of around 30% through 2012, “Indian DTH Market Forecast to 2012”. 20% annual growth is being witnessed in the DTH sector in India with over 8. 5 million households having digital pay-TV. A eport attributes that the anticipated growth to the efforts of DTH industry players who are all trying to lure viewers by cutting down prices as well as offering perks even though it translates into loss of Rs 1,600-2,000 on each new subscriber acquired by them. They have started to offer a number of value-added services such as ‘movie on demand’, live recording of TV content, matrimonial match-making, etc. Pattern of Growth The big game is all about shaping up grandiose plans to master the winning rules to garner as much portion of the Indian DTH pie as possible by a handful of players.
Since the DTH space denotes big value, akin to the space occupied by television and telephony, inter-firm rivalries have thrown up price wars, discount schemes, procurement of transponders, ambitious targets for improving the subscription base, popular bouquet of channels, set top boxes with superior quality of videos, improving content, etc as a desperate means to entice the Indian viewer. The pattern of growth is very difficult to determine because a business cycle takes place in long term.
But this industry is having very short period for making or observing a business cycle. The analysis that can be made is though the economic cycles is not continues and it was in boom then when the industry started and now just the economy is in recovering stage from the recession. Interesting factor is that all the industries are hit seriously buy the rescission but DTH industry has reported growth continuously but only it has slowdown the rate of its growth. Now the industry is growing at 20% for every annum.
Growth Determinants Demand constraints and SCAR are the factors which effects the growth of the industry. Growth determinant and high TV sales increase the chance for more sales of set top box which will effect the growth. When the facilities of the products increase it acts as a growth determinant. The entertainment channels and the news channels players increase the growth to opt the DTH. Some of the DTH players are bringing innovative plans like live shopping, broad band, and etc will act as growth determinants.
TECHNOLOGY OF PRODUCTION AND DISTRIBUTION Cost Structure The costs incurred by the DTH players is mainly on its technology, satellite dish, set top box accessory cards, Ku band transponders in the satellites, customer premise equipment(CPE). The launch of satellites is another huge cost which the DTH plays shares the transponders. And it costs them much than any thing. Another cost incurred is on operating cost. Economies of Scale Economies of scale may be utilized by any size firm expanding its scale of operation.
The common ones are purchasing (bulk buying of materials through long-term contracts), managerial (increasing the specialization of managers), financial (obtaining lower-interest charges when borrowing from banks and having access to a greater range of financial instruments), and marketing (spreading the cost of advertising over a greater range of output in media markets). Cost Advantages 1] Direct customer relationship. 2] Better storage 3] Extensive use of resources. 4] Availability of labour at cheap rates Economies of Scope
An economic theory stating that the average total cost of production decreases as a result of increasing the number of different goods produced. Often, as the number of products promoted is increased and the DTH players used, more people can be reached with each rupee spent. These efficiencies do not last, however; at some point, additional advertising expenditure on new products will start to be less effective (an example of diseconomies of scope). If a sales force is selling several products they can often do so more efficiently than if they are selling only one product.
The cost of their travel time is distributed over a greater revenue base, so cost efficiency improves. There can also be synergies between products such that offering a complete range of products gives the consumer a more desirable product offering than a single product would. Economies of scope can also operate through distribution efficiencies. It can be more efficient to ship a range of products to any given location than to ship a single type of product to that location. Value added Many players are using this DTH as the basis and giving many value added services to the customers.
Some of the players are giving best valued services to the customers like Airtel gives live-news, home shopping, live gaming, broad band, horoscope, radio, and etc. Tata sky is giving recording for more than 4 hours, and came with a differential strategy of Tata sky+ with other facilities. Big TV is giving live with Big movies, Dish TV is giving live TV on the wheels, and many other value additions. Logistics Logistics is still a nascent and fragmented industry in India. It is estimated that while outsourced logistics accounts for 54% of total logistics spending in India, organized players have only 10% of the pie.
DTH industry follows a good logistics which is as similar to the logistics which are used buy automobile industry, for the effective management of the DTH industry. Labor Labours are included in every activity of the business, most of the people working are not daily labours, they are employed and paid monthly in the form of salary. DTH requires skilled labor like management executives, administrators, software engineers, sales executives and attorneys. Marketing Market segmentation, marketing strategies, marketing practices and marketing concepts specific to the industry
Indian TV channel broadcast 15. 7-mn advertisement every year, which totals to 362-mn seconds of TV advertisement every year. India currently has over 400 channels. TV viewer ship has declined by 5% since 2001. TV broadcasters are expected to go hike in advertisement rate this year by 16-18%. Market segmentation in DTH industry mainly concentrates on women who don’t like missing their daily soap and news more ever women are able to learn English speaking which is a very special feature of DTH.
DTH also concentrates on children also by providing them games, dictionary, some discovery videos specially inbuilt, maths, science and social knowledge. It also focuses on old people as it has updated videos of various holy and religious places. DTH uses different marketing strategies for promotion and sales of its product. It gives advertisements with their brand ambassadors which attract customers, door to door selling, on the phone selling, discount and offer sales, packages, etc Marketing practices is a continuous process as the competition keeps increasing among the players in the industry.
Each player is investing lots of money in promoting there brands. Many players are making advertisement with movie actor and actress as brand ambassadors for their products because DTH is mainly considered with entertainment. Some of the companies like Tata sky is having Super Star Amir khan as brand ambassador and Airtel is having many film stars like kareena kapoor, A. R. Rehaman, saif ali khan, etc. Dish TV is also having Super Star Sharuk khan as the brand ambassador. Sun direct also uses southern actress for their brand promotion.
Marketing practices are the decisions taken by the manufacturing company to increase sales, expand themselves into many areas etc. Successful marketing practices bring sale up, while unsuccessful marketing practices have no impact on sale or negatively impact sale. Marketing concepts specific to the industry is primarily targeted at a niche segment who buy the TV sets from the electronic
