Bharti Airtel and Tata Group’s Tata Play have ended talks of a DTH merger which would have created the largest direct-to-home services entity in the country, the telco said in an exchange filing late Saturday night.
In February, Airtel had notified the exchanges that it was in active discussions with the Tata Group to acquire DTH and broadband services provider Tata Play. However, those in the know said that the two could not reach common ground on some crucial aspects of the deal, and hence the talks have been terminated.
“We wish to inform you that after not being able to find a satisfactory resolution, the parties have mutually decided to terminate the discussions,” Airtel said in the exchange filing.
India’s paid DTH sector had 58.22 million subscribers as at the end of December 2024, according to the latest performance indicator data by the Telecom Regulatory Authority of India (Trai). This has shrunk from 59.91 million subscribers in the prior quarter.
The DTH subscriber base in the country has been shrinking over the past few quarters as the accessibility and availability of online streaming services has grown. Sports events like the Indian Premier League, which used to provide a spike in subscriber numbers and revenue for digital television service providers, are also now available on video streaming platforms, at times for free through ad-supported models.
From 63.52 million at end of December 2023, the DTH subscriber base has shrunk 8.3% over four quarters to end December 2024 at 58.22 million.
Tata Play is the market leader with a share of 31.49% followed by Airtel Digital TV (housed under Bharti Telemedia, a subsidiary of Bharti Airtel) at 29.89%. Other paid DTH players include Sun Direct and Dish TV with 19-20% market share each.
The merger of Tata Play and Airtel Digital TV would have created a clear number in the DTH market. More importantly, it would have given Airtel access to Tata Play’s premium customers, and its optical fibre network as the telco furthers its ambitions to expand its home-broadband footprint.
Both Reliance Jio and Airtel are sharpening focus on the home broadband which has a higher average revenue per user (ARPU) as compared to mobile subscriptions. Both are also utilising their 5G spectrum to offer fixed wireless access (FWA) services, the only viable monetisation avenue for consumer 5G.
In late April, Airtel announced that it has entered an agreement to use Adani Data Network’s 5G spectrum acquired in the 2022 spectrum auctions.
Airtel is expected to use the acquired spectrum for expanding its fixed wireless access (FWA) offerings, one of the few use cases which can be monetised in the 5G consumer market. Airtel, along with Reliance Jio, has been deploying FWA solutions in select cities.