The Indian Satellite And Cable Space

Indian cable & satellite (C&S) space is valued at Rs. 167 bn, growing at a brisk pace of ~22% p.a. Despite being the largest segment in the Indian Media & Entertainment industry, almost all players within the space have been suffering losses due to lack of addressability in the analogue transmission mode and high level of fragmentation as a result of low entry barriers. However, the space is all set for a phase of sustained digitization and consolidation led by consumer demand for quality and technology making it affordable. It is believed that half of India's C&S homes will be converted to digital by 2015, creating one of the world's largest digital subscriber base.

The Indian cable and satellite space (C&S space) comprises of delivery of TV signals to consumers through cable, satellite or broadband. The industry is a decade and a half old, third largest in the world in terms of cable network reach, and highly fragmented and unorganized because of low entry barriers in the analogue mode. The C&S distribution segment is the last leg in the television industry's value chain which comprises of content producers, broadcasters, Multi System Operators (MSOs), Local Cable Operators (LCOs) and satellite players. Even though the sector comprises 28% of the total entertainment and media industry and is growing at 22% per annum, most of the value creation is being cornered by the LCOs due to lack of addressability in the value chain. However, we believe that the sector is all set to witness disruptive change brought through technology, which will shift the balance of power towards MSOs and DTH players, unlocking huge value for operators in this space.