Trai Mandate Effect: OTT Apps Might Prove Damaging to DTH Viewership and Revenue

The OTT and VOD apps offer lots of content for free and also at affordable costs thus reducing the attraction towards DTH services

Highlights
  • The OTT apps also have multi-platform advantage and more ease of access along with lower prices
  • These apps have also been considered a much cheaper option in comparison to DTH services

After the introduction of the new tariff regime by the Telecom Regulatory Authority of India (Trai) which changed a lot of parameters in the industry, many areas of the DTH and broadcasting sector were affected. However, owing to the rise in prices, and the tedious migration process which the subscribers had to face, the customers were attracted to the OTT apps and video-on-demand platforms. Applications like Netflix, ZEE5, Hotstar and more saw an increased affinity due to their low subscription prices and the range of content available. This increased attraction of the public towards these apps also poses the questions whether or not these apps will affect the viewership of DTH providers.

trai-mandate-effect-ott-apps-might-damaging

 

Widespread Distribution of OTT Applications

Before Reliance Jio came into the telecom industry, people barely used to consume video content online. Watching a YouTube video on a smartphone was a great deal because data packs were expensive. However, times have changed now. We are getting to see a lot of very cheap data packs which have immensely boosted video consumption. Also, a lot of OTT applications like ZEE5, Hotstar and others are being offered with these data plans as freebies. The result is that now the users’ phones have doubled down as their TV screens, whereas in comparison there has been no revolutionary breakthrough in the TV industry and there has been no such drastic price reduction also. In fact, after the introduction of the new pricing regime, many subscribers have complained about rising monthly rentals.

In such a situation, the distribution of content and the ease of access has also increased for the OTT apps. Another significant advantage is the personalised recommendation which the apps can make. Thus, subscribers can watch what they like, and they are not bound by what the broadcaster is showing.

Differences in Pricing

Being a very competitive industry, there is also the pricing factor which has been driving the OTT craze in India. Owing to the cheap plans and the data tariff war which bruised the industry, the telecom operators now want to set themselves apart, and they are making content offerings as their differentiating factor. As a result, many subscribers are getting access to these apps free of cost. This is in high contrast to the DTH industry where subscribers pay a fixed monthly rental.

However, the difference in pricing comes even when you are paying for these apps. For example, Hotstar’s Rs 365 VIP plan which gets you live cricket, Premier League matches and Formula 1 races along with other Premium content. Compare this to other packs on your DTH subscription, and you will find that you will be required to pay a similar amount on a monthly basis instead of annually, hence the cost differences inevitably seem to be very high. Hotstar VIP subscription also gives you the access of Star Network channels to watch Live TV.

What will Happen in the Industry?

In such a case, there is bound to be a gradual increasing leniency of people towards the OTT applications. With the increasing quality of shows on these platforms, massive investments from the companies and increased data consumption will contribute to this factor. It can also be said that the coming of the new Trai tariff regime has somewhat hastened this transition as now many subscribers are of the thought they are overpaying for their subscriptions. But, it is also worth keeping in mind that since DTH is such highly penetrated and reliable form of broadcasting system, the reasons are not yet compelling enough to make the subscribers do a complete flip to OTT platforms.

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Arpit spends his day closely following the telecom and tech industry. A music connoisseur and a night owl, he also takes a deep interest in the Indian technology start-up scene and spends rest of his time spilling poetry and stories on paper.

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Faruk KadirRAJASHANKAR DEsmailBharat Khannad5aqoep Recent comment authors
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Faruk Kadir
Faruk Kadir

I am not sure why trai not launching pay per minute plan.
Give access to all the channels with pay per minute.

City
Gurgaon
Operator
Airtel & Jio
DTH
Dish & Thop tv
d5aqoep
d5aqoep

Maybe Trai wanted this to happen and destroy DTH industry. They may also want to ease in Jio IPTV services which will be delivered through Fiber and are not DTH.
I think it is just a part of Ambani’s big game.

Bharat Khanna
Bharat Khanna

service providers will bounce back with their onw version of iptv for sure

Esmail

The same TRAI mandates which apply to DTH players applies to IPTV as well, then how is it a plan to favour Ambani or Jio? TRAI mandate governs all digitally addressable systems which includes, cable, DTH, IPTV or any other form of live TV platform. Only non encrypted signals are exempt from the mandate so if there is any partiality, it is towards Doordarshan’s free dish not Jio IPTV.

RAJASHANKAR D
RAJASHANKAR D

Before trai mandate DTH companies have bargaining power with channel owners but now they don’t have irrespective of market share which will favour Jio as they don’t have market share and they will come with 0 ncf at launch. Trai is absolutely favouring jio

Esmail

The fixed channel pricing by broadcasters creates a level playing field between all operators and has benefited all small MSO’s it is not specific to Jio. Yes Jio will not charge NCF since it’s live TV service will be available only to it’s fiber broadband subscribers who are already paying for broadband which is carrying the live TV stream. There is a good chance that Jio may not even charge the subscription charges for the channels and may absorb that like it did for providing free voice calling by absorbing the IUC. DTH will lose ground in urban areas and… Read more »

RAJASHANKAR D
RAJASHANKAR D

U are indirectly saying trai favouring Jio and I am directly saying trai favouring Jio. small MSO will benefit is a myth infact they are the one will die as soon as Jio launches
Small MSO may have short term benifit

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