Future of Cable TV in South India?
BARC India’s recently released Survey says 95% of homes in South India have a TV now. According to report, there are 259 million TV-owning individuals in the five southern states of Tamil Nadu, Andhra Pradesh, Telangana, Karnataka and Kerala, up 8% from 2016. This also means 31% of total TV-owning individuals are present in these five states. The number of TV-owning individuals in the North is 209 million. For West the number is 221 million and for East it is 146 million.
The Survey covered 300,000 households, approximately 4,300 towns and villages, and 68% of the urban market. “The survey has thrown some interesting facts about South India’s TV-viewing habits. While the total TV penetration in India currently stands at 66%, in South India it is as high as 95%. This can also be attributed to the fact that electrification in South is around 99.9% and one of the first durables people buy after getting electricity is TV,” Partho Dasgupta, CEO, BARC India, said.
With 8 out 10 people sampling TV daily and a high time spent of 4 hours 10 minutes, South has been witnessing a year-on-year growth in the ‘average time spent’ on TV. The region also generates viewership of around 12 billion impressions at a weekly level. 31% of the TV individuals in South contribute to 40% of the total TV viewership.
According to Survey, the growing affluence in South India has played an important role in family structure and durable ownership, affecting TV viewing in the region. The survey also states that at an all-India level, the average family size for TV homes is 4.25 individuals. In South, this is much lower at 3.8 individuals per household. This goes on to shows that families in South are much more nuclear in nature.
The socio-economic profiles of homes in South India have also improved as compared to 2016. While the affluent (NCCS A) have seen a growth of 9%, the upper middle class (NCCS B) TV homes have grown by 15%. TV homes falling under low socio-economic profiles (NCCS D/E) have dropped by 7%. Nuclear families, the increasing middle-class and rising disposable incomes are helping households move across the affluence chain.
The survey says close to 30% homes in South have their female members working either fulltime or part time. The ratio further improves in rural where 35% of homes have their women working. Among the TV homes in South, nine out of 10 NCCS A homes own a refrigerator and six out of 10 own a washing machine. Entertainment in South is of prime importance across the value chain. The survey points out that while 85% of NCCS D/E homes have a TV, only 66% of these homes have a gas stove. This proves the need of these families to sit together and watch their entertainment.
Increasing consumption of TV
Despite the increasing consumption of TV content on digital platform, television still remains the dominant mode of media consumption in India. According to KPMG’s recent report, Media Ecosystem: The walls fall down, the television industry in India is estimated at Rs 65,200 crore in FY18, a growth of 9.5 percent from FY17, having grown at a CAGR of 10.7 per cent between FY14-18. The market size consists of advertising revenues of Rs 22,400 crore and subscription revenue of Rs 42,800 crore in FY18.
The television industry had a relatively subdued year in FY18, with advertisement revenues facing headwinds due to the implementation of GST and moderate growth in the overall economy. At the same time, subscription revenue growth was lower than expected as the DD FreeDish subscriber base soared to 30 million and Direct To Home (DTH) ARPUs declined with an increase in competitive intensity. The number of TV households increased to 188 million in FY18 with the Cable & Satellite (C&S) subscriber base reaching 183 million. While cable and DTH aggregated 91 million and 62 million households respectively, FreeDish has gained a substantial user base and emerged as an alternative entertainment platform, especially in the DAS Phase III and IV markets.
Speaking about the key trends in the television industry, Girish Menon, Partner and Head, Media and Entertainment, KPMG India, “The operationalisation of digitisation continues to be slow while seeding of boxes has reached where it can. The conversion of packaging the offerings has not yet started to happen. Coming to TRAI Tariff regulation, December end is when they will start operationalising. Our sense is that after the hearing it will bring in transparency across the value chain.” The TV industry is expected to grow at a CAGR of 12.6 per cent on the back of increased penetration and strong advertising demand due to healthy domestic consumption and major events (two cricket World Cups and General Elections being among them); better distribution realisation due to TV digitisation is likely to result in strong growth in the years to come. Lastly, while consumption of TV content on the digital platform is expected to grow further, television is likely to remain the dominant mode of media consumption in India.