Tata Sky, the newest direct-to-home (DTH) TV services provider claims to be on track to cross the one million subscribers in the first year of its launch.

As competition in the DTH space heats up, Tata Sky is doing some number crunching. The company has just completed 40 days of operation, and says that at present it has roped in one-lakh subscribers, and is on track to cross one million within a year of operation.

According to Vikram Kaushik, managing director and CEO, Tata Sky, "We have seen an astounding response, in fact there have been 17.5-million hits on our website in the first seven days. Right now we have 100,000 subscribers and we are right on track to hit the one-million mark in a year."

In its first month Tata Sky has tried to lure customers through its many value-added interactive services branded ''Actve''. It has eight Actve services like Actve Khabar, Actve Sports and the newly launched Actve Whiz Kids among others. The company believes that these value additions will help it score over competition.

Tata Sky''s introductory subscription offer of Rs200 and is inclusive of all taxes, but this is bound to go up soon as the company increases its reach and adds more channels to its bouquet. But the quantum of rise is not known yet.

Kaushik says, "Our rates for now are Rs200 per month, without any hidden costs. We will increase it and it will be driven by market factors. Rates will be competitive, but I cannot say what exactly we will increase it to."

The other player in the DTH space is Essel Group''s Dish TV, which has been in the market for almost three years, and has around 13 lakh subscribers currently, and hopes to double this number this fiscal.

Tata Sky currently does not offer its rival Dish TV''s Zee channels, but the company says it is in talks with Zee Turner and will offer its channels within a few weeks.

While the urban reach of such services is obvious, what Tata Sky also claims is that its B2B tie-ups with ITC, e-Choupal and Godrej are helping it to reach rural India too.

"We have customers all over India. Our services are available in 3,200 cities. In fact, 30 per cent of our connections are in rural India. We have tie-ups with companies like ITC and initiatives like e-Choupal, where our digicomps are being retailed and we are also offering pre-paid cards," says Kaushik.

Dish TV is not far behind it is talking to tech firms for deals like the one that it has with HCL for technical support and Open TV for interactive news service.

Customers sure have their plate full with cable TV, Dish TV and soon coming CAS services, but it remains to be seen how soon can DTH services take over cable TV.

"I think for a long time cable and DTH service will co-exist, in most countries abroad too both these services co-exists. However, the ratio differs. We do not see a cable wipe out soon, but we feel that with the kind of value-added services that we offer, most consumers should switch to us soon."

Meanwhile, the new phenomenon of IPTV or Internet TV is the next technology these DTH players might have to compete against.

Peeyush Agrawal, general manager (broadband services), MTNL, recently said, ''We are looking to launch IPTV in the next few months, hopefully by October.''

However, Tata Sky feels this technology has been talked about for the past few years and won''t become a reality any time soon. "I have been hearing about IPTV for the past few years, but I don''t think it will become a reality in another five to seven years. I don''t see it coming into India soon,'' says Kaushik.

M S Rana, executive director, MTNL (Mumbai), added, "IPTV will be launched soon, through this one would get over 200 channels, along with video-on-demand, on the existing TV using a set-top box, on a monthly rental basis."

This is not all, the competition will become more fierce as Anil Ambani''s ADAG enters the DTH space. ADAG''s service has got the government''s approval and should be operational by under the name of Reliance Blue Magic by mid-2007.

It now needs to be seen how soon DTH operators convince cable subscribers to switch to their services.