Mumbai: Tata Sky will cancel channels or packs for about 7 million subscribers from June 15 in a bid to reduce their monthly bills and retain them on the direct-to-home platform.
The rationalisation exercise by the DTH operator is aimed at retaining customers with a monthly billing of Rs 350 monthly or less. The company lost over 1.5 million customers over the past two months after they simply cancelled or failed to renew their subscriptions, many of them calling it unaffordable.
Almost 70% of 5 million subscribers who logged in to the Tata Sky website or app in May wanted to drop channels in order to reduce their monthly bills. While viewers are losing interest because of the unavailability of fresh content and live sports, the coronavirus induced slowdown has affected the spending power of some consumers.
“One million inactive subscribers came back to our platform in March, once the lockdown was implemented. However, 1 million went out in April and another half a million didn’t recharge in May,” Harit Nagpal, Managing Director of Tata Sky, told to media. The company’s analytics team found that deactivation was mostly by subscribers with a monthly billing of less than Rs 400.
“The analytics showed which customers were vulnerable and finding it difficult to pay. So, rather than losing customers entirely, we decided to drop some packs and channels and reduce their monthly bills,” Nagpal explained. “So, for the first time, we will use analytics to downgrade and not up-sell packs.”
Tata Sky has identified 6-7 million of its 18 million subscribers who will benefit from the exercise and save Rs 60-100 per month. Tata Sky’s decision is a good move to retain subscribers.
“As it is difficult to gain new subscribers in the era of video streaming and OTT, Tata Sky’s move will ensure that the customer is retained on the platform for a longer period of time,” said Dokania. “However, as broadcasters are already hard-pressed for advertising revenue, it will be interesting to see how they will take this new arrangement.”
Nagpal said downgrading customers was better than losing them. “If I am able to control churn, broadcasters still earn, but if the customer leaves, there is no revenue to share. I think it is time to rationalise the packs and retain the consumer. When things go back to normal, we expect customers to start adding channels and we, too, will go back to promoting upgrades,” Nagpal said.
Tata Sky has started giving 15-day notice to subscribers of the change in their packs. Nagpal said if consumers want to retain the channels being discontinued, they have to make a missed call.
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