SPACE TV GETS
FIPB GO AHEAD
Space TV, the DTH (direct-to-home) television
services joint venture between the Tatas and Star, has obtained
FIPB clearance, paving the way for Star to bring its foreign
equity into the project.
Space is currently looking at a launch
between Diwali and the end of the year. A recent Space TV
presentation to the Union information & broadcasting ministry
had mentioned an introductory price of Rs 4,999 per subscriber,
but sources said the DTH service may be launched with a price
tag of Rs 2,999.
The launch date of Space TV's services
is close, with the JV putting its act together on the manpower
front. Vikram Kaushik, who recently quit Colgate-Palmolive,
will head the Space TV operations in India .
Until recently, Mr Kaushik was working
as executive V-P (marketing) with Colgate. He joined Colgate
in November '99 after a short stint with Britannia Industries
as V-P (marketing).
Space TV has also appointed Shankar De,
a merchant banker, as its CFO. Mr De, among other assignments,
has worked for the international investment banking firm Rothschild.
Mr Kaushik and Mr De are expected to kick off senior-level
recruitments at Space TV soon. Industry sources said that
with the basic norms of DTH licensing having been satisfied
by Space TV, the I&B ministry is expected to issue the
DTH service-provider a letter of intent (LoI) soon.
This will pave the way for other clearances
such as the one from the Union home ministry. Star India CEO
Peter Mukherjea was not available for comment. Tata Sons,
the holding company of the Tata Group, has an 80% equity stake
in the Space TV venture while Star keeps the rest
Though both Star and the Tatas have been
hush-hush about the terms of the alliance, it is known that
the content and technology will be provided by Star while
the Tatas' equity will include the uplinking infrastructure
it provides through VSNL.
DTH services in international markets
have several pricing tiers, depending on the number of channels
a subscriber opts for.
The basic service, usually a 20-channel
bundle, comes cheap, but packages that include sports and
movie channels are higher priced.
While the cost of the hardware - a small
dish antenna, a set-top box and smart card that activates
the channels - costs around Rs 6,000, Space TV and Zee's Dish
TV are looking to heavily subsidise the start-up costs to
get higher subscriber numbers, a la NewsCorp's BSkyB operations
in the UK.
STAR's Hong Kong-based CEO, Michelle Guthrie,
who was recently in India to make a presentation at Ficci's
'Frames' convention, had made a strong pitch for DTH.
She recounted the huge success of its
UK operations, BSkyB, which in a short span had grown to offer
400 channels and a host of interactive services, including
banking and gaming. BSkyB's subscriber base in the UK has
already crossed 7m.
"The launch of DTH opens up a new
era for satellite television in India, eliminates the need
for the last-mile operator, provides choice to a consumer,
increases transparency and product offerings," she said.
The Subhash Chandra-promoted ASC Enterprises
was the first to receive the government's LoI for offering
DTH services last June. The company launched its DTH service
under the 'Dish TV' brand on October 2, '03 . Dish TV currently
offers 48 channels, but Star refused to put its channels on
the platform.
