Direct-to-Home (DTH) industry has been under immense pressure since the time users started streaming live TV content on their smartphones. Not just that, but the rapid growth of OTT (over-the-top) services and platforms has slowed down the business of DTH players. To counter the challenge to a certain extent, the DTH players are also investing in building and offering in-house OTT platforms. Tata Play has Tata Play Binge, Airtel has Airtel Xstream, and Dish TV has Watcho.
But these in-house OTT platforms aren't going to put the DTH players back on track towards growth. As 5G rapidly grows and 4G networks are optimised to perform better, more and more OTT platforms and online streaming services will start gaining popularity. At a time like this, DTH players need to incentivise Indian consumers to purchase DTH connections. One way to do that is by offering free STBs. This doesn't only mean that the STB is free but also that the installation should be free.
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The amount of money that a consumer has to spend on an HD or a Smart STB today, he/she can instead spend on a subscription to an OTT platform. If you go on to the website of Airtel and see the price of the two STBs listed there, you will see that at the bottom, it is mentioned that the cost is for the installation of the connection. So in a way, Airtel can claim that it is offering the STB for free, but that won't be true because the customer would have to pay money for the installation. Yes, it is a one-time cost, but it is something that could discourage users from getting new DTH connections.
DTH players can instead ask the consumers to pay security deposits on the STBs that they will get back once they are done with the connection. Further, DTH companies should encourage users to get multiple STBs for their homes and offer the second connection totally free or at a 50% security deposit.
This way, the DTH companies would start getting cash and could also upsell several services through the STB. The cost of DTH services is also going up as you read this. The introduction of NTO 3.0 has raised the prices of the DTH bills. The rising cost of DTH services is definitely not going to help the sector.
DTH companies need to work on building models where they can upsell services through the STB that a customer acquires from them. Older models just offering channel packs are not going to do the trick. Even Tata Play bundling OTT services with the channel packs is not enough. It is actually confusing for many consumers as they have to weigh in about what would be a value buy for them amongst different channel packs.
