India Pay-TV industry revenues to grow at 7% CAGR over 2020-25

New Delhi, Apr 12 (IANS): A new report published by Media Partners Asia (MPA) indicates that India's pay-TV industry will grow at 7 per cent CAGR between 2020-25 as total industry revenues, including subscription and advertising, reach $12.3 billion by 2025.

The report, entitled India Pay-TV Distribution 2021, predicts that more than 96 per cent of India's pay-TV homes will be digitalised by 2025 with total pay-TV subscribers expanding from 127 million in 2020 to 134 million by 2025.

MPA estimates India's active DTH homes will grow from 58 million in 2020 to more than 68 million in 2025. Meanwhile, cable's share of pay-TV subscribers will decline from 54 per cent in 2020 to 46 per cent by 2025 while IPTV will pick up a small share after rolling out later in 2021.

Commenting on key distribution trends, MPA India Vice President Mihir Shah said: "Robust backend systems, the ability to offer consumers flexibility in choosing channel packages under NTO and the exit of leading private channels from DD Freedish helped the DTH pay-TV sector grow even after the new TRAI tariff regulations came into effect.

"Going forward, DTH will be the key driver of growth fulfilling the needs of the majority of new TV households entering into the pay-TV ecosystem. Premium cable subscribers in urban centres remain vulnerable to churn as uptake of quality fiber-based broadband services including IPTV grows in affluent pockets of urban India."

According to MPA, total pay-TV industry revenue, including subscription and advertising, declined 10 per cent Y/Y in 2020 to $8.9 billion as the economic downturn post-Covid eroded advertising. The recommencing 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 per cent contraction in 2020, pay-TV advertising will grow at 12 per cent CAGR over 2020-25.

During 2020, pay-TV broadcasters generated $4.4 billion in total revenue (62 per cent from advertising and 38 per cent from subscription), down 17 per cent Y/Y. A sharp recovery is expected over the next two years with the channel business; advertising will primarily drive this expansion.

"Trai's heavy spate of regulations in recent years have 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. 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 revitalize content creation in the pay-TV industry while also helping to bolster pricing power for pay-TV platforms," Shah said.



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