Table of Contents
Executive summary ........................................................................... 3
Outlook ....................................................................................................................................3
Valuation ..................................................................................................................................4
Risks ........................................................................................................................................4
Broadcasting vs. distribution divide................................................ 5
First level of consolidation: broadcasting or distributing? .........................................................5
ARPU remains a key issue . . . ..................................................................................................6
. . . as has been the broadcasters’ advertising focus ................................................................8
GEC consolidation to precede and possibly drive distribution consolidation ............................8
Cable vs. satellite divide ................................................................... 9
Satellite to gain 70% incremental market share........................................................................9
The penetration vs revenue view............................................................................................10
While cable decides ARPU . . . ...............................................................................................12
. . . satellite drives capex.........................................................................................................13
Conclusion: an emerging Nash equilibrium.............................................................................15
Cable vs. satellite divide: the international experience ............... 16
US: high ARPU-led cable market.............................................................................................16
Europe: satellite better placed in the UK.................................................................................16
Japan: high ARPUs, stable market..........................................................................................17
China: high penetration, lower ARPUs require investment .....................................................18
What has driven last-mile consolidation? ..................................... 19
Internationally, competition from DTH has forced the fragmented cable industry to
consolidate.............................................................................................................................19
The telecom parallel ........................................................................ 21
Capex drove telecom consolidation over nine years...............................................................21
“My enemy’s enemy is my friend” ................................................ 24
Appendix A: International markets ................................................ 26
Zee Entertainment........................................................................... 30
Dish TV India Ltd ............................................................................. 38