Bharti Airtel and Tata Group’s Tata Play have officially called off their negotiations regarding a potential merger in the direct-to-home (DTH) sector. This move, announced late Saturday, would have resulted in the formation of India’s largest DTH service provider.
In February, Airtel indicated progress in talks with Tata Group, aiming to acquire Tata Play, a provider of DTH and broadband services. However, sources close to the discussions revealed that the two companies could not agree on several key points, leading to the conclusion of talks.
Mutual Decision to End Discussions
Airtel confirmed in their exchange filing, "After failing to reach a satisfactory resolution, both parties have decided to mutually terminate the discussions." This decision marks a significant shift in the landscape of India’s DTH industry.
Current State of India’s DTH Market
As of December 2024, India’s paid DTH sector reported 58.22 million subscribers, down from 59.91 million in the previous quarter, according to the Telecom Regulatory Authority of India (Trai). This decline reflects a broader trend where the subscriber base has consistently decreased due to the rising popularity of online streaming platforms.
- DTH Subscribers Trend:
- December 2023: 63.52 million
- December 2024: 58.22 million (8.3% decline)
The availability of major sports events, such as the Indian Premier League, on streaming services—often free with advertisements—has further contributed to this trend, leading to a drop in traditional DTH subscriptions.
Market Dynamics and Key Players
In the competitive DTH market, Tata Play leads with a 31.49% market share, closely followed by Airtel Digital TV at 29.89%. Other notable players include Sun Direct and Dish TV, each holding around 19-20% of the market.
The merger between Tata Play and Airtel Digital TV could have revolutionized the DTH landscape, enhancing Airtel’s access to Tata Play’s premium customer base and its extensive optical fiber network, which is vital for expanding Airtel’s home broadband services.
Shifting Focus to Home Broadband
Both Reliance Jio and Airtel are increasingly concentrating on the home broadband segment, which typically yields a higher average revenue per user (ARPU) compared to mobile subscriptions. They are also leveraging their 5G spectrum to introduce fixed wireless access (FWA) services, a promising avenue for monetizing consumer 5G.
In late April, Airtel announced a partnership with Adani Data Network to utilize its 5G spectrum acquired during the 2022 auctions. This strategic move positions Airtel to broaden its FWA offerings, aligning with industry trends and consumer demands.
In summary, the halted merger talks between Airtel and Tata Play underscore the dynamic nature of India’s DTH market as it adapts to evolving consumer preferences and technological advancements.
