DTH firms turn to OTT aggregation to stem user churn

Tata Play and Dish TV are among the first movers in the TV distribution industry to launch OTT bundles, while the latest player to join the bandwagon is cable TV major GTPL Hathway. GTPL Hathway has launched the ‘Genie+’ service in partnership with 15 OTT apps.

“The reality is that linear TV is on a decline and customers are moving to OTT. Aggregating OTT will help traditional platforms to retain customers and diversify their service offerings,” said Anuj Gandhi, founder of media tech startup Plug and Play Entertainment.

Retaining an existing customer is far more feasible for a service provider than acquiring a new customer, he added. Traditional TV distribution platforms, according to him, will be competing with global and local OTT platforms besides YouTube and telcos. GTPL Hathway chief strategy officer Piyush Pankaj said venturing into OTT aggregation would help the company build customer stickiness, reduce churn and grow market share. “We also plan to offer gaming, storage, security and financial services to our customers going forward,” he added. Elara Capital’s Karan Taurani said the big challenge for TV distribution companies will be to scale up the OTT aggregation offerings.

Telcos are ahead of the TV distributors in the aggregation game, he noted. “For OTT players, telecom will continue to be the only means of distribution at scale. Either the customer will go directly to an OTT or will go through the telco pipe. OTT aggregation by cable and DTH platforms is not scalable in nature,” he said.

The pay-TV universe has been on a decline beginning with the implementation of a new broadcast tariff framework in 2019. The rise of OTT and DD Free Dish DTH platforms have played a major role in the dip in the pay-TV base. TV distributors are also facing tough competition from telecom operators.

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According to a Ficci-EY report, TV subscription revenue shrank 6.2% in 2021 due to a reduction of 6 million pay-TV homes and a fall in the average revenue per user (ARPU). Meanwhile, India’s subscription video-on-demand base has expanded by 18% to 130.2 million in 2022 from 110.5 million in 2021, as per a recent study by Ormax on the OTT universe in India. According to media analysts, OTT aggregation is a win-win for all stakeholders in the value chain. While it helps service providers retain customers, it allows the OTT platform to reach new customers. For users, it provides single billing and a unified interface as the country has 40-plus OTT apps.