India pay-TV industry revenues to grow steadily | Media Analysis | Business | News | Rapid TV News
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With a projected 7% CAGR over the years from 2020-25 and a satellite industry described as ‘robust’, the Indian pay-TV market is set to show reasonable returns despite an unhelpful regulatory regime says a study from Media Partners Asia (MPA).
DTH India 12 April 2021
The report, entitled India Pay-TV Distribution 2021, predicts that the market will be spurred by more than 96% of India’s pay-TV homes being digitalised by 2025 with total pay-TV subscribers expanding from 127 million in 2020 to 134 million by 2025. Total industry revenues, including subscription and advertising, are set to reach US$12.3 billion by 2025.

MPA estimates that India’s active DTH homes will grow from 58 million in 2020 to more than 68 million in 2025. Looking at the potential wining platforms, cable’s share of pay-TV subscribers will decline from 54% in 2020 to 46% by 2025 while IPTV will pick up a small share after rolling out later in 2021.

Yet this growth comes after a trying 2020. According to MPA, total pay-TV industry revenue, including subscription and advertising, declined 10% year-on-year in 2020 to US$8.9 billion as the economic downturn post-COVID eroded advertising. The analyst also forecast that during 2020, pay-TV broadcasters generated US$4.4 billion in total revenue - 62% from advertising and 38% from subscription - down 17% year-on-year.

Assessing the key distribution trends, MPA India vice president Mihir Shah said that a heavy spate of regulations in recent years from local regulator TRAI has depressed investment in pay-TV content and limited price elasticity for platforms. “This could have detrimental impact on the quality of content available for the mass market,” Shah remarked. “We expect that more consolidation will play out in the broadcasting industry as recent tariff amendments force incumbent broadcast networks to recalibrate existing channel portfolios. The economics of less popular channels and several niche channels are no longer viable. A new and less draconian regulatory framework will help revitalise content creation in the pay-TV industry while also helping to bolster pricing power for pay-TV platforms.”

Indeed, going forward, MPA expects no less than a “sharp” recovery over the next two years with the channel business, driven primarily by advertising, and given a boost by the recommencement of fresh content and live sports together with improvements in consumer and economic sentiment will lead to a sharp recovery in 2021.

After a 25% contraction in 2020, MPA forecasts that pay-TV advertising will grow at 12% CAGR over 2020-25. DTH is also seen as a key driver of growth fulfilling the needs of the majority of new TV households entering into the pay-TV ecosystem. Yet MPA regards premium cable subscribers in urban centres as remaining vulnerable to churn as uptake of quality fibre-based broadband services including IPTV grows in affluent pockets of urban India.