Hit by the economic slowdown and mounting operating losses, leading direct-to-home service providers like Airtel’s Digital TV, Dish TV, Big TV and others have put their plans of launching the next level of DTH service — Digital Video Recorders (DVRs) — on hold, or are going slow.

The DVRs are upgraded DTH set-top boxes that come with an added feature to record and pause live television channels. Because of this feature, their cost is up to 10 times the price of ordinary DTH boxes, which are priced between Rs 1,500 and Rs 2,000 apiece.

So far, only Tata Sky is providing its DVR service, Tata Sky Plus. It is said to have sold only about 30,000 units since its launch about three months ago, less than 10 per cent of the Tata Sky subscriptions sold in the same period, informed sources said. Because of the cost of its DVR boxes, Tata Sky could be giving a subsidy of Rs 5,000-8,000 on every connection of Tata Sky Plus, thereby adding to its annual losses, sources said. According to a projection made by Media Partners Asia, the combined operating losses of DTH companies will cross Rs 2,000 crore in 2008-09.

“The sale of DVR service comes with heavy cost implications to DTH service providers, which only adds to their existing financial burden of offering the basic DTH services. This may be among the reasons why some of the existing DTH players are holding back the launch of their DVR services,” an industry expert said.

However, Tata Sky is quick to defend Tata Sky Plus. “We see not more than 10-15 per cent of our total subscriber base taking Tata Sky Plus. And based on its sale so far, we are right on track in meeting our target,” Vikram Mehra, chief marketing officer, Tata Sky told Business Standard, declining to share the numbers.

In the 11 million DTH subscriber market, Tata Sky is the second-largest DTH operator with 3 million subscribers, behind Dish TV that now has 4.8 million DTH subscribers. Sun Direct has crossed subscriber base of 2 million, while Big TV has about 1.2 million subscribers. However, Airtel is yet to make an announcement of its subscriber numbers for its Digital TV since it was launched in October last year.

“Under current economic circumstances, selling DVRs will be a risky proposition, especially when it has very limited appeal,” a senior executive working for a leading DTH company said.

Dish TV, which had announced the rollout of its DVR service last year, has not launched it so far. “I will blame the delay to the fluctuating dollar-rupee equation. Our DVR boxes are undergoing field test and we will launch at the earliest possible opportunity,” Salil Kapoor, COO, Dish TV, said.

However, sources say that pricing and the lack of demand for DVR boxes are among the key points that may have caused Dish TV to postpone its launch plans.

On its part, Airtel is betting big on its interactive IPTV services more than the DVR launch. “We are not saying that we will not launch our DVR service but Airtel Digital TV Interactive (Airtel’s IPTV service) offers even more attractive features than the DVRs available in the market and that too at extremely affordable price points. Also, it comes bundled with broadband and a landline connection,” Atul Bindal, president, Bharti Telemedia, said while launching Airtel’s IPTV service.

Reliance ADA group’s Big TV, too, intended to launch its own DVR boxes and the IPTV services by late last year. Both these services are now delayed, industry sources say. A Big TV spokesperson said: “... BIG TV will launch its DVR service in coming weeks.”

However, company sources say Big TV’s DVR service may not come before the beginning of the next fiscal.

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