STBs which are imported from foreign Countries are purchased directly by MSOs which in turn sell to the customers directly on a lease basis thus avoiding VAT
News | by CIOL Correspondent
BANGALORE, INDIA: Domestic players of Set Top Boxes (STBS) in India facing trouble in gaining competitiveness over foreign players in spite of increasing the custom duty by 5 per cent, finds the 6Wresearch Quarterly India STB Market, Q1 2013.
In spite of giving relief to local players by increasing 5pc custom duty on imports of STBs in India, domestic players are finding difficult to produce STBs in India due to the policies loopholes enjoyed by the international players, the reprot said.
STBs which are imported from foreign Countries are purchased directly by MSOs which in turn sell to the customers directly on a lease basis thus avoiding VAT. However, local manufacturers are required to charge VAT on the production of STBs in India making their product less competitive in terms of cost and thus impacting their production of STBs in India.
According to 6Wresearch, the total shipments for STB in India amounted to 5.3mn units in CY Q1 2013. Skyworth leads the Indian set top box market, followed by Cisco, Coship and others.
With government directing rules to completely digitize the entire pay TV market by 2014, the demand for STBs is expected to increase exponentially in the coming years. Evaluating the present market scenario, majority of the total cable TV subscribers are still on analog based networks; however we expect a shift towards digital cable TV platform. Also, with the introduction of High Definition (HD) channels and smart TVs, the market for digital TV viewing is expected to increase significantly.
Imports of STBs in India constitutes the significant share of total STBs, around 85pc, in India due to the cost advantage enjoyed by the foreign players.