Tata Sky to invest Rs 900 crore in FY14, eyes 30% growth

Company will switch to MPEG-4 format that will enable it to offer more than 300 channels from about 230 now

Direct-to-home television operator Tata Sky plans to invest Rs 900 crore this fiscal on upgrading technology as it targets a 30% growth in subscribers.

"We will invest around Rs 900 crore to shift to new technology that will help us expand our channel offerings," Tata Sky CEO Harit Nagpal told PTI.

The company will switch to the MPEG-4 format from the current MPEG-2 standard, enabling it to offer more than 300 channels from about 230 now. The changeover is part of Tata Sky's strategy to increase its subscriber base, which stands at 10 million.

"We have already started the process of moving over to the new technology. This is likely to be completed by July 2014. We have to change set-top boxes of each of our customers, hence it will take so long," Nagpal said.

Tata Sky is one of six private DTH companies offering services to 56.5 million subscribers as of March 31, according to the Telecom Regulatory Authority of India (Trai).

"We will grow by 25-30% this financial year," Nagpal said, adding that digitisation has helped to win over former analog cable customers.

DTH companies are adding 8-10 million customers every year as analog cable systems are digitised to allow all TV signals to be provided only through set-top boxes, he said.

The second phase of digitisation of cable TV systems ended on March 31 and covered 38 cities with a population of more than 1 million, according to Trai. The whole country is expected to be covered by the end of 2014.