Tatas Set To Steer Star DTH Venture With 80% Stake

New Delhi: | Updated: Sep 24 2003, 05:30am hrs
It could well be termed as a season of partnership for Rupert Murdochs Star. After tying up with Kolkata-based Ananda Bazar Patrika (ABP) for Star News, the group is understood to have narrowed down on the Tatas as Indian partner for its Rs 250-crore direct-to-home (DTH) broadcasting project. Star is likely to make an announcement soon, government sources said.

Even as Essel Groups ASC Enterprises, promoted by Zee chairman Subhash Chandra, is ready to roll out its DTH operations from October 2, the Star venture may take off around March next year. After the ban on DTH was lifted by the government in 2000, the Star group got interested in the system once again, and applied in the name of Space TV. At that point, Star referred to Space TV as a company known to them (Star). It may be recalled that Star had to fold up its DTH setup in the late 90s, after government banned use of Ku Band for broadcasting and in turn direct-to-home broadcasting.

Although government began its scrutiny into Space TVs credentials and its links with Star, it granted the company a so-called conditional letter of intent (LoI) for DTH. The government reasoned that Star had requested for a conditional letter, to make its search for an Indian partner easier. While talks were on with some leading corporates for a few months now, finally it is going to be the Tatas, sources added. When contacted, Tata group spokesperson refused to comment.

Tata branding, sources said, is likely to be an USP for the Star DTH project. With 20 per cent foreign direct investment (FDI) cap in a DTH venture, the Tata group is expected to hold 80 per cent and Star 20 per cent. The total foreign investment allowed in DTH is 49 per cent. Star officials were unavailable for comment.

Unlike its competitor Zee, which is targeting non-cable TV areas for DTH, Star is clear that it would be present in metros and other big cities. Although Mr Murdochs DTH is expected to be meant for upper middle class urban clientele, the group is talking big on subsidies, sources said. As per its plans, the customer would pay Rs 5,000 for a set-top box and a dish antenna. Zee/ASC is offering it for Rs 3,990 plus taxes, besides Rs 400 (refundable) for smart card, according to a Zee official. The monthly subscription fee for Star DTH would be in the region of Rs 300 to Rs 400, according to sources. Zee/ASCs starting fee is Rs 150. Star is understood to have arrived at a business model after exploring several of them globally. Finally, the BSkyB model is likely to be followed for Star DTH.