The Direct to Home (DTH) satellite broadcasting service has emerged as perhaps the only segment that has seen a clear benefit from the COVID-19 lock-down, with all three listed players seeing an increase in their customer revenue during the lock-down.
The biggest jump in revenue was reported by Airtel Digital, which saw its revenue jump by a whopping 23.4% during the April-June period compared to the immediately preceding period of January to March. In actual terms, revenue rose from Rs 603.5 cr to to 744.8 cr during this period.
Sun Direct, a prominent DTH service in South India and a part of Sun TV Network, also saw its revenue rise 5.4% during this period — from Rs 205 cr in Jan-Mar to Rs 216 cr in Apr-Jun.
The third listed player, Dish TV, too saw an increase in its service revenue by 1.9% to Rs 791.5 cr from Rs 776.6 cr in the preceding quarter.
This has marked out DTH as perhaps the only sector in which all the players have reported revenue growth during the lock-down. In contrast, in many sectors such as hospitality (hotels) and garment retail, the Apr-Jun period has seen a decline of 70-90% in revenue compared to the Jan-Mar period.
Speaking in late June, Sun TV’s managing director, R Maheshkumar had clearly pointed to the lock-down having a salubrious impact on Sun Direct’s subscription revenue.
The rise in consumption is directly attributed to people activating more channels or moving to more premium packages or activating previously inactive connections to get over the boredom of staying at home for months on end and to keep themselves abreast of the latest news on Coronavirus.
At the same time, the benefits of the growth has hardly been uniform.
Two players — Airtel Digital and Tata Sky — who have the highest number of premium channels in India — are reported to have benefited the most during the last four months, while the benefits for other two have been more modest.
One of the key reasons for the sudden rise in Tata Sky and Airtel Digital’s numbers may be a new TRAI rule that caps the rentals on additional connections at 40% of the primary connection.
This is reported to have led many subscribers to consolidate their multiple connections on a single platform. Since TRAI’s 2019 regulations already brought in uniformity of channels and packages between all DTH players, the latest cut in rentals for the secondary connections further removed any pricing advantage that Dish TV and Sun Direct used to enjoy.
With pricing no longer being a differentiator, it is likely that more and more new or consolidating customers have been gravitating towards DTH players who offer the highest number of premium and HD channels.
Nevertheless, the fact that even Dish TV, which has been struggling to get back its earlier growth trajectory, was able to report a sequential increase in its subscription revenue during a period of widespread economic upheaval points to the strong demand for home-based informational and entertainment services during the lock-down.
Many analysts had also expected a similar and sharp increase in revenues for another sector — telecom.
However, analysts were underwhelmed by the growth trends posted by the telecom industry during the COVID-19 lockdown.
While the expectation was of growth of around 20%, what has been reported so far has been considerably lower than that.
In fact, Bharti Airtel, which reported a 23.4% sequential jump in its DTH revenues, reported a 0.6% decline in its mobile revenue during the period of April-June compared to the preceding three months (January-March).
Market leader Reliance Jio, however, was able to report a growth of 11.8% in its revenue and 10.6% in its data sales.
The third player, Vodafone Idea, is yet to release its numbers for the lock-down period.