Direct-to-home (DTH) operator DishTV has added 186,000 net subscribers during the quarter ended June 2017 (Q1 FY18), an increase of 12.72% from the165,000 subscribers added in the preceding quarter. With this, Dish TV’s total number of subscribers now stands at 15.7 million.
The management added subscriptions could have been higher but the Ramadan festival moderated addition. “Ramadan during the last month of the first quarter moderated subscriber additions and recharges which otherwise could have been even stronger. Unlike fiscal 2017, this year the period of Ramadan fell completely in the first quarter as against a Q1-Q2 split last year. Involvement in the GST transition process during the last few days of the quarter also diluted some managerial attention towards the business,” the press release read.
Video streaming platforms
DishTV mentioned that it has started renegotiating with broadcasters for its content costs due the presence of OTT platforms (to be read as video streaming applications). The company added that it has “achieved success in reducing costs with one of the large broadcasters recently” but did not give further details on the same.
Note that DishTV has not given a separate line item in its financials for programming and content costs but it now says that its operating costs stood at Rs 343.17 for the quarter. In the preceding quarter, DishTV spent Rs 232.37 crore for programming and content.
However, DishTV’s managing director Jawahar Goel sought to allay fears of video streaming platforms eating into the business. “New technology would generally replace the traditional means only if it provides something better than what the incumbent is providing and at much more efficient price levels. The fact of the matter is that even at the current, all time low data prices, the cost of watching Standard Definition TV for a month through streaming devices would turn out to be at least 3-5 times higher than the popular average monthly DTH subscription.”
A back-of-the-hand calculation shows that he is right. A wired broadband connection in Mumbai costs approximately Rs 500-700 per month and Netflix subscription for standard definition TV costs Rs 500 for a single screen. A basic DTH subscription costs Rs 160 per month.
However, he added that there is an increase in overlap of telecom, media and technology and DishTV will be launching a Hybrid set-top-box and would bring back its OTT services in a new Avatar.
An aside: It is a different matter that a broadband connection will allow a customer to use the whole Internet. Granted that data consumption is being driven primarily by video, but data connections also allow users to conduct other facets of life for work and productivity. So it is a false equivalence that to equate a data connection and video streaming subscription to a DTH connection.
– Operating revenues of Rs 738.9 crore, down 5.1% year-on-year
– Net Loss for the quarter stood at Rs 13.9 million crore, compared to a profit of Rs 36.1 crore in Q1FY17.
-Subscription revenues of Rs 691.7 crore, down 5% YoY
-EBITDA of Rs 201.2crore, down 22.9% YoY from Rs 261 crore in Q1FY18.