Tata airtel’s DTH business: Consumers in India are increasingly moving away from cable connections and turning to digital platforms to watch videos and live streaming. In such a situation, the news of merger between Tata and the Indian group in their loss-making DTH i.e. Direct to Home business Airtel Digital TV and Tata Play is coming to the fore.Bharti Airtel is going to merge its DTH business, Airtel Digital TV with Tata Play.
Tata airtel’s DTH business
If this merger happens, it will be the biggest merger in India’s DTH sector after Dish TV’s merger with Videocon D2H in 2016.Neither Bharti Airtel nor Tata Sons have officially commented on the merger, but sources indicate that the announcement could come within a few weeks. Both sides have been talking about this for months. The Economic Times has published a report regarding this.
How will the merger happen?
This merger will happen through exchange of shares. Airtel will hold a majority stake of 52-55%, while Tata Play shareholders including Tata Sons and Walt Disney will hold 45-48%. This will be a non-binding deal.
Waht is binding &non binding deal ?
A binding agreement or deal is the opposite. It is legally binding. That means both parties have to fulfill the terms of the agreement. If one party breaks it, the other can take legal action against it.A non-binding deal is an agreement that is not legally binding. Meaning, companies make such a deal to work together, there is no compulsion to fulfill the terms of the agreement.
Even if one party breaks the agreement, the other party cannot take legal action.Why is the merger happening? The decision to merge Tata Play and Airtel’s digital TV has been taken at a time when people are preferring to watch online videos and live streaming instead of TV. According to the Telecom Regulatory Authority of India, the number of DTH users has declined to 6 crore in FY24, from 7 crore in FY21.
Post the merger, Airtel Digital TV will get access to Tata Play’s 1.9 crore homes and 50 lakh broadband customers. Currently their combined number of subscribers is 3.5 crore. The merged company will have the ability to provide many more services by bundling telecom, broadband and DTH.Tata Play was started in joint venture Tata Play was started in 2006 as a joint venture with Rupert Murdoch’s News Corp.
Earlier its name was Tata Sky. When the Walt Dizzy Company acquired Murdoch’s 21st Century Fox in 2019, this stake passed to him.Airtel TV was launched in 2008 Bharti Airtel Limited launched the direct to home (DTH) satellite TV service ‘Airtel Digital TV’ in the year 2008. Initially this service was made available to customers through 21,000 retail outlets in 62 cities.Triple play strategy The merger of DTH business Tata Play and Airtel Digital TV is in support of the triple play strategy.
With this, telecom broadband and DTH services are being connected together. After this merger, Airtel’s Tata Play will reach 19 million homes.What experts say in the DTH sector?DTH expert have to say is that even though the DTH and Pay TV industry is declining, Airtel can still be the biggest player in this market. Under this, there will be the ability to provide many more services by bundling telecom broadband and DTH.
Jay Chavda He is the Founder and Writer of businesspulsecare.com. He is an I.T Engineer, Freelancer, Businessman. He posts Business, Stock/Share Market, Finance Related News and updates on the website. 🔗