Business – DTH players sniff 100% growth, hike marketing budgets

Priyanka Akhouri

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Discuss Mumbai: Videocon’s entry into the direct-to-home (DTH) industry in July has spiced up competition in the segment and the main players are focusing on three mantras for success – packaging, pricing and marketing. Looking to grow by almost 100% in the current financial year – from Rs 1,500 crore in 2008-09 to an expected Rs 3,000 crore in the current financial year – leading firms have increased their marketing budget by 20% to 25%.

Sun Direct’s marketing budget was hiked from Rs 125 crore to Rs 150 crore in FY10, whereas Big TV has an annual spend of about Rs 160-180 crore on marketing and promotion, and is believed to have spent Rs 50 crore last August during its launch month. Bharat Business Channel Ltd (BBCL), the company housing Videocon’s DTH venture, plans to invest Rs 1,000 crore over two years. Since the launch of Tata Sky Plus, the company has spent over Rs 25 crore on promotion of the total investment of Rs 2,500 crore made in the project.

Sugato Banerjee, CMO, Bharti Airtel DTH, said, “The FY10 marketing budget has definitely increased to achieve better distribution in large and small cities.” Tata Sky with Aamir Khan, Dish TV with Shahrukh Khan and Airtel’s recent Kareena Kapoor and Saif Ali Khan ads have created an impact and make these three the only DTH players using movie celebrities in their ads. Big TV and Sun Direct, on the other hand, plan to continue with their current ads and are not in any hurry to rope in Hindi film stars.

Tony D’Silva, COO, Sun Direct, said, “We achieved the three-million subscriber mark by March and recently touched four million.”

On the other hand, Big TV believes in fulfilling the increasing regional and Hollywood market demand. Mahesh Prasad, president, Reliance Big TV, said, “In the last financial year, our subscriber base was 1.4 million, which increased to two million in March this year. We have recently tied up with a Warner Brother channel and Korean and Russian channels for global content.”

To increase customer base, most DTH players introduced festive offers during Onam and Rakhi. “Based on the past 12 months’ operation, we have seen an increasing demand for our product and are on the lookout to introduce similar offers on Diwali and Dussehra,” said Prasad of Big TV. D’Silva of Sun Direct said, “DTH service is a capital intensive industry and does soak up substantial investments in the beginning. There are ongoing investments on customer equipment, hardware and capacity building.”

Videocon rolled out its DTH service from Punjab in July this year and what makes this young entrant different is the fact that it is the only player that manufactures TV sets, DVDs and set-top-boxes.