Asian Pay TV Operators' Views on 2011
Asian Pay TV Operators' Views on 2011
With almost all TVs sold in the Asia Pacific soon becoming fully High Definition (HD)-capable, better image quality will no longer be sufficient to boost consumer equipment purchasing, or to differentiate one offering from the next. HD is clearly a revenue opportunity for Asia's pay TV operators, with many HD channels requiring an individual subscription. Over half of the 35 Asian pay TV operators, representing polled in a recent industry survey now offer HD.
Among pay TV platforms in Asia, bundling is on the increase. 80% of operators in the region now offer bundled packages, up from 60% a year ago. The main driver behind bundling for industry players is increased new subscriptions. From the audience perspective, bundling makes navigating the increasingly wide choice of channels easier by providing branded' packages that are easy to identify with.
Operators with more advanced platforms (IPTV, digital cable) have better technical ability to customize their bundle offerings. Analog providers are not able to compete at the same level.
Disenchantments in 2010
Having appeared to have generated a lot of interest in the industry and indeed a certain amount of investment, gaming delivered over pay TV platforms and mobile TV are both starting to look like something of a busted flush.
The jury is still out on mobile TV, with opinion split on the future opportunity and many operators just not knowing whether there is revenue potential there or not. While operators with carefully considered mobile strategies that tie into a wider digital offering may be generating money, 42% of the operators polled in the 2010 Asia-Pacific Pay TV Operators Survey by GIA and ContentAsia are still unsure of the potential.
Less than one in five operators see gaming as an area of future opportunity. The titles and quality available across pay TV systems simply do not compete with those on dedicated consoles or PC platforms, making a gaming suite now more of a hygiene factor than a selling point.
Changes expected in the Asian Pay TV landscape for 2011
Asia's Pay-TV industry players are turning their attention to new technologies, such as IPTV and 3D TV. According to the GIA/ContentAsia survey, about a third of the Asia-Pacific region's pay TV operators currently provide IPTV services. IPTV is also the technology that is seen as the greatest future opportunity, aside from HD. A further third of the operators anticipate potential future subscriber demand for TV delivered over the Internet.
However, IPTV is as much of a threat to some operators as it is an opportunity. Almost one in three operators polled said they see TV, movie and video content distributed over the Internet whether legally or illegally as a threat to their future success.
This is a view held mainly by cable operators, especially those with analogue infrastructure, as it allows relatively "new to the game" telecommunication companies to play in the Pay TV space and compete with the incumbent players on a canted field. The telcos have the advantage of a pre-existing infrastructure and with little additional capital expenditure required can focus their efforts and their budgets on content acquisition, sales and marketing.
Furthermore, operators with more advanced platforms such as IPTV and digital cable have better technical ability to customize their offerings. Programming targeting niche audiences such as youth, women or specific ethnic segments is on the rise in Asia. Operators are increasingly moving into production and content generation in order to meet the needs of their local audience. Programmers focusing on selected genres, such as Chinese language, are emerging, particularly in Hong Kong, with its strong tradition of home-grown movie and TV production.
Key concerns for 2011
Piracy will remain a key concern, especially in developing Southeast Asian markets. Efforts to curb unauthorized viewing have been increasingly successful in recent years, and now need to continue if the benefits to the industry and ultimately to viewers and advertisers are to be fully realized.
With the advent of digital set-top boxes, it's now more about picking and choosing than ever before. Audiences can be very selective about content and skip the advertising. Programmers and advertisers need to come to terms with this new reality Blockbuster content is important to gain attention, and exploring new ways of integrating advertisers' and increasingly sponsors' brands and messages into that content is essential. Programmers must engage with specific audiences and stay very focused on the core values of each channel offering if they want to build viewership and pull in the big money.
About the 2010 Asia-Pacific Pay TV Operators Survey
Produced by Global Intelligence Alliance in cooperation with ContentAsia, the 2010 Asia-Pacific Pay TV Operators Survey polled senior managers at 35 operators in 14 countries across the region. The objectives of the survey were to take the temperature of the pay TV industry at a time of enormous change, and to offer objective insights into the mindsets of the people and companies that have the biggest influence on TV channels' businesses today the region's pay-TV operators.
The operators interviewed represent 67.2 million subscribers, covering about 43% of the estimated universe of 154.9 million subscribers. The 14 (out of the 35) operators who agreed to be identified are listed below.
Australia: Foxtel
Brunei: Kristal Astro
Hong Kong: Hong Kong Broadband, TVB Pay Vision, Hong Kong Cable TV
India: Indusind
Japan: WOWOW, J:Com
Pakistan: Asia Media Group
Philippines: Southern Cablevision, Global Destiny
Singapore: Starhub
Taiwan: Wonderful Cable
Vietnam: Vietnam Cable
This article and others from GIA's Telecommunication, Technology & Media practice can be found at Global Intelligence Alliance industries.
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