Tata Sky Actve Services: Tata Sky DTH bets on Value Added Services to gain market share

I came across an article in The Hindu, elaborating Tata Sky’s consumer oriented strategy of value addition as compared to mere cost cutting measures undertaken by its competitors.

In an interview to The Hindu, Mr Vikram Kaushik , the Managing Director and CEO of Tata Sky, revealed that Tata Sky will not enter the “price war” that is going on in the DTH industry but would rather concentrate on its customer service, technology and the quality of its value-added services as its USP. While accepting that Tata Sky connection comes at a premium when compared to other players, Mr Kaushik states and I quote “thanks to our customer service and quality value-added services, we hold over 45 per cent of the DTH market in terms of value. Our ARPU too, is at least 30 to 40 per cent more than most other players in the industry.”

He stated that overall; the industry was witnessing rapid growth. Of the 130 million TV homes, more than 85 million are pay-channel homes. And, 25 per cent of this was expected to move to the DTH segment by the end of the year. With more players in the fray, Tata Sky too, reduced its installation costs, though they are still higher than the other players.

However, as Mr Kaushik states, at the end of the day, it is the service and value offerings which hold the key when it comes to retaining the acquired subscriber and ensuring a good ARPU. As a part of this strategy, Tata Sky has launched next-generation set-top boxes that come with a 160 GB memory capacity personal video recorder.

“You can record another programme that is going on in a different channel, or you can give the box an instruction to record a particular programme every day at a set time on a specific channel. So, we kept ahead of the rest of the pack, consistently,” he says. According to Mr Kaushik, over 75 per cent of Tata Sky subscribers belong to the Section ‘A’ segment. He also revealed that Tata Sky had a 3.7-million subscriber base and hoped to touch four million in the next couple of months.

It appears that Tata Sky is following a distinct strategy of “value addition” rather than merely cutting costs like its competitors. After all, what matters in long run is how much value a product brings to the customer. Tata Sky knows this very well. As a part of the Tata group, who believe in giving best to their consumers, the fact that Tata Sky is following the same philosophy is hardly a surprise. While Tata Sky customers make a higher investment in initial stages, the returns in terms of overall experience which they get in long run, are far higher as compared to any other DTH service. This “consumer first” philosophy will help Tata Sky to go strength to strength in the future.

To read this article in detail, check out the following link:

http://www.thehindubusinessline.com/2009/06/10/stories/2009061050630500.htm