Set-top box prices hiked to pass on rupee hit.

Those looking to buy a new direct-to-home (DTH) connection, get ready to shell out more.

Given the rupee’s decline, DTH operators are left with no option but to pass on the incremental cost of importing set-top boxes (STBs) to new subscribers.
Leading the pack is DTH market leader Dish TV, which has a 28% share of India’s $1.5 billion, 32.4 million subscriber (2012 figures as per Media Partners Asia) DTH industry.

 The company has increased the prices of its standard definition (SD) and Dish Plus recorder STBs by Rs 250 effective Thursday to Rs 2,249 and Rs 2,349, respectively. No hike has, however, been effected for high-definition (HD) set-top boxes, which continue to be sold at Rs 3,099.

The increase in STB prices more or less mirrors the rupee’s decline against the dollar. The local currency has lost almost 12% in the last two months and closed Thursday at 60.13.

Dish TV officials did not share further details citing silent period for their fiscal first quarter results, which are due soon.

Other DTH players, including Tata Sky, Reliance Digital and Airtel Digital are also hiking prices.

Harit Nagpal, CEO & MD, Tata Sky, the Tata Sons DTH joint venture with Star India, confirmed the price hike, saying changes in currency rates hurt the company since it imports all its STBs.

“New customers will now get a Tata Sky connection at a marginal (8-10%) increase owing to the falling exchange rate of the Indian rupee,” he said, adding that the new rates took effect on July 1.

A Reliance Digital TV spokesperson, too, confirmed a Rs 260 hike in SD set-top boxes to Rs 2,250 from July 4.

Officials from Videocon d2h and Sun Direct could not be reached.

Though Airtel Digital has not formally announced its decision yet, a company official said a price hike is inevitable.

“DTH companies are already facing challenges by offering STBs at subsidised rates. The depreciating rupee is only making things tougher. I’m most certain that STB prices will be increased in more or less the same proportion to what competition undertaken,” the official said, requesting anonymity.

The DTH industry is on a growth trajectory thanks to compulsory digitisation prescribed by the Telecom Regulatory Authority of India. Industry experts feel DTH players will benefit the most in the third and fourth phases of digitisation, covering the entire nation by December 2014.

A report by Media Partners Asia, an independent provider of information services focusing on media, communications and entertainment industries, the Indian DTH industry will grow to $3.9 billion and 63.8 million subscribers by 2017 and $5 billion and 76.6 million subscribers by 2020.

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