Tata Sky along with other standalone cable and Direct-to-Home (DTH) players “could get affected with the growing adoption of multiplay services in the urban areas,” says Deepa Dhingra, senior telecom analyst at GlobalData. According to a report released by GlobalData, a data and analytics company in late June, multiplay service revenues are “expected” to record a 5.4% compound annual growth rate (CAGR) between 2020 and 2025. Among the multiplay households, the report said that the double play bundles accounted for 83.9% market share in 2020, followed by triple-play and quad-play bundles with a 12.3% and 3.7% market share respectively.
Regional Wired Broadband Operators Likely to Soon Offer Multiplay Services
The Telecom Subscription Data for the period ended April 30, 2021, as released by the Telecom Regulatory Authority of India (Trai) highlights that India has 2.24 crore wired broadband users.
“Fixed broadband services offer low latency and superior speeds with symmetrical download and upload speeds compared to mobile broadband, which makes fixed broadband services more suitable for enterprises segment where multiple devices are connected to the same network,” Dhingra told TelecomTalk in an email interview.
Further, Dhingra said that wired broadband has gained traction in recent years as it offers “more consistent and reliable speeds” for learning, work from home as well as entertainment, making it ideal for residential users.
“GlobalData also believes aggressive promotions by service providers in terms of discounts, complimentary unlimited telephony services and free subscriptions to OTT applications have been helping gain traction for multiplay plans,” Dhingra said.
Crucially, Dhingra said the regional broadband operators are “likely to follow the trend and start offering multiplay bundles,” in the upcoming years due to “increasing competition from large players,” like Reliance Jio and Bharti Airtel.
“The existing broadband lines can be used to deliver telephony, broadband and video services, which leads to optimum utilization of network resources at reduced Capex,” Dhingra said.
JioFiber, the fibre-to-the-home (FTTH) service offered by Reliance Jio is said to be currently offered in over 100 cities across the country. However, the company in the past highlighted that its JioFiber service will be available across 1600 cities in India. Similarly, Bharti Airtel in early July said that its Xstream Fiber service would be available in 1000 cities across India in a “matter of months.”
“Growing popularity of video-on-demand platforms and enhanced user experience through 4K Set Top Box definitely help service providers attract subscribers, especially in urban cities where fixed broadband has a relatively better coverage,” Dhingra said.
The Telecom Subscription Data for April highlights that Bharti Airtel is the second-largest wired broadband service provider with over 31 lakh users while Reliance Jio has over 28 lakh users.
“However, limited availability of fixed infrastructure in rural areas pose [a] challenge for operators to provide services that require low latency and higher capacity,” Dhingra said. We believe that though regional operators with limited resources are at a disadvantage when it comes to providing services in urban areas, untapped markets in rural and remote areas provide a wide scope for growth for these operators.”
Airtel, Jio Would Offer “Fierce Competition” to BSNL
In late 2020, Jio revamped its JioFiber plans with the operator providing its users' access to 12 over-the-top (OTT) platforms including Netflix, Amazon Prime Video and Zee5 on its select plans. Meanwhile, the Airtel management in early July said that the company is “is in talks” with OTT services for “seamless integration with Black plans.”
While GlobalData expects multiplay service revenues to grow over the next few years, Dhingra said that the standalone DTH and cable players like Tata Sky “have also started promoting video-on-demand content.” The senior telecom analyst at GlobalData said that the move by Tata Sky to promote video-on-demand is in a bid to enhance its “competitiveness in the market.”
“Standalone cable and DTH players have been taking advantage of the limited coverage of fiber and other high-speed technologies in rural and remote areas, where delivering traditional cable and satellite services have remained more cost-efficient,” Dhingra said.
In late February, the state-run Bharat Sanchar Nigam Limited unveiled a new Cinema Plus add-on service bundling multiple OTT subscriptions including Zee5 and SonyLIV into a single package. In the previous years, the operator largely offered Disney+ Hotstar with its select plans. It also has to be noted that the state-run operator in late 2020 also unveiled new broadband plans at multiple price points on par with JioFiber and Xstream Fiber plans. According to the Trai data, BSNL has over 60 lakh broadband users as of April 30, 2021. However, the Telecom Subscription Data also highlights that the operator has lost over 20 lakh broadband users between December 2019 and April 2021.
“BSNL already leads the multiplay service market in terms of the number of multiplay households,” Dhingra said. “We project that BSNL will continue to hold the largest share of multiplay households over the next five years, however, aggressive strategies adopted by Airtel and Jio would give a fierce competition, leading to decline in BSNL’s market share.”