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Free TV viewership to grow by 55 per cent from 2016 to 2020: EY report

Rural viewers contribute to 52 per cent of the overall viewership and are estimated to contribute 74 per cent of DD Free Dish’s total viewership

Free TV viewership in India is set to grow by 55 per cent over 2016 to reach 46 million households by 2020, says a report titled ‘India’s Free TV–A game changing opportunity’. The study by Ernst&Young says this will be in addition to consumption of content on mobile DTT handsets.

The number of free TV viewers was at 30 million in 2016. The increase in the number of FTA channels has also led to a significant rise in viewership for genres such as Hindi GEC, Hindi movies and, primarily, the Hindi news genre, in which FTA channels command 81 per cent of the total viewership.

Ashish Pherwani, Partner, Advisory, Media and Entertainment, EY said, “Free television is increasingly becoming a viable option for channels looking to capture the base-of-pyramid audiences in urban and non-urban areas. With a large subscriber base, it also opens up new avenues of advertising for marketers looking to get reach some of the fastest growing markets in the country. The change in customer behaviour will also have a significant impact on FTA and pay TV channel uptake, and corresponding spends on subscription income.”

Currently, rural TV viewers contribute to 52 per cent of the overall viewership. However, it is estimated to contribute 74 per cent of the total viewership on DD Free Dish.

The report outlines four key factors that will drive the uptake of free television:

1. Digitisation of cable TV distribution – DAS IV

The mandatory move towards digitisation will require consumers, particularly those in DAS III and IV markets, to opt for more expensive cable TV options, DTH or free TV options such as terrestrial TV or Free Dish. EY expects the price-conscious customers may opt for free television services in the immediate term.

2. The proposed new tariff order

The new tariff order will make customers choose between the options to either pay more to receive pay channels of their choice or decide that free television would be a better option, given the quantum of quality content on it. This will help further drive subscriptions from price conscious consumers for Free TV.

3. The fast growth of DD Free Dish

DD Free Dish bouquet is set to increase to over 250 channels, featuring quality content, also including sports being available on its spectrum. This makes the Free Dish bouquet a formidable competition to pay bouquets.

4. DTT on mobile infrastructure

Another important development relating to mobile television is the emergence of digital terrestrial distribution. Since this is a broadcast technology, the key implication will be that consumers whose mobile handsets have the required antenna would not be required to pay any bandwidth charges. Consequently, once the mobile handset ecosystem matures, DTT could also provide a strong addition to free television services.

The report also notes the implications of growth in free television for broadcasters and distribution companies in the near future, which include:

Broadcasters:

  • Pricing of channels, particularly those that are not leaders in their genres, and determination of whether channels should move to FTA
  • Number of channels to include in base and base+ packs of distributors
  • Carriage fee considerations
  • Creation of free television products and differentiation of free and paid television products
  • Competition from Free Dish offerings to broadcasters’ pay channels
  • Increasing audience reach from a DTT perspective

Distributors:

  • Creating packages for various customer segments, while at the same time convincing customers to pay more for fewer channels
  • Ensuring channels from all broadcasters are present in each popular package
  • Placement of channels in and within appropriate packages
  • Prevention of subscriber migration to free television

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