Indonesia’s net advertising revenue in 2006 was over US$1.1billion, of which around 70% (US$775million) was spent on TV advertising and 30% on print. And predictions indicate that both TV and print advertising will rise by 15% annually over the next three years. This is especially good news for Indonesia’s largest media company MNC, which derives around 95% of its revenues from advertising. MNC owns free-toair TV networks RCTI, TPI and Global TV, which according to AGB Nielsen Research, garner a combined audience share of 35.4%; followed by Trans TV’s 18% share for its two networks. Surya Citra has an audience share of 17.2%; Indosiar 15.9% and Bakrie/News Corp 5.6%. Media Partners Asia estimate that MNC commands 37% of terrestrial TV advertising revenues, followed by Surya Citra’s 17% and Indosiar’s 8% shares. Much of MNC’s success has been attributed to its strategy of audience segmentation across its TV networks and other media assets. The media power-house also broadcasts program channels like 24-hour news channel MNC News; MNC Entertainment; and MNC Music channel, programmed with 70% local music & 30% foreign music. The company promises more channels in the pipeline as part of its content distribution strategies. On the print side, MNC owns the 2005-launched daily newspaper Seputar Indonesia, known as ‘Koran Sindo’. Success of weekly infotainment tabloid Genie, focusing on lifestyle and celebrity gossips, led to the launch of two more publications, Tabloid Realita and Tabloid Mom&Kiddie. And MNC Networks operates and manages one of the largest radio networks in Indonesia; comprising four brands: Trijaya FM, ARH Global, Radio Dangdut TPI and Women Radio and in partnership with more than 36 radio stations. MNC recorded revenue of IDR2,209billion (US$234,000) for the first nine months of 2007, an increase of 51% compared to the same period in 2006; of which 48% was profit, compared to 45% the previous year. Hary Tanoesoedibjo, Group CEO of MNC, expected adspend to continue strong in the fourth quarter. “Hence, we are on track of beating our internal projections of revenue and net profit towards the end of the year.” End June 2007 saw MNC report that revenue and operating income were up 58% and 100%, on the same period the previous year. Advertising revenue, comprised of advertising on both TV and non-TV, was showing 53% YoY growth. Non-advertising revenue, which includes content, value added services (VAS) and others, was growing at a rate of 106% YoY; its increase directly attributed to content revenue, which saw exponential growth of more than 1000% YoY. Indeed, the company’s content strategy is cited by CEO Tanoesoedibjo as having been key to success thus far. MNC’s content production of movies, drama-series, reality shows, situational comedies, and TV films, is currently around 60,000 hours per year – reported to rise by 16% a year. The company is also eyeing content distribution. “We are aiming to make our large content library available to be enjoyed by local as well as international viewers. Part of our distribution strategies is to licence content broadcast to other broadcasters and also to create program channels that can be broadcast on pay-TV.” Talent shows count among the networks’ most successful content, including Indonesian Idol, Kontest Dangdut Indonesia, Audisi Pelawak Indonesia and Miss Indonesia. RCTI recently hosted and staged the panregional Asian Idol. Mid-2007 also saw MNC raise US$412million in its IPO and announce that more than US$200million was to be spent on expanding its media and broadcasting business, including content development and potential acquisitions. An additional US$65million will be used to repay bonds and finance future capital expenditure. Post IPO, PT Global Mediacom owns 70% of MNC; Singapore’s MediaCorp. acquired a 6.5% stake in the company for US$90million. Mediacom also realized its long-mooted plan to assume a majority stake of MNC Sky Vision (Indovision), the leading pay-TV operator with 290,000 subs, more than half of the legitimate market. Most recently announced news was MNC’s intention to buy, through one of its wholly owned subsidiaries, not less than 51% of outstanding shares in ailing Chinese telco Linktone Ltd. A provider of interactive media and entertainment products and services to consumers in China, Linktone is also currently an exclusive advertising agent and main content provider for Qinghai Satellite Television, a satellite TV channel reaching 24 provinces in China with 276 million viewers. According to third party sources, China’s advertising spending market is US$14.7billion and is estimated to grow by more than 15% per year over the next several years, making it one of the world’s largest and the fastest growing advertising market in Asia. Said Tanoesoedibjo, “MNC is committed to transforming Linktone into a leading, diversified regional media player for three key reasons. Firstly, we believe the Chinese media market has many similarities to emerging markets, such as Indonesia, in terms of both the level of fragmentation and the enormous potential for growth. Secondly, Linktone’s advanced capabilities in mobile content provide a strong platform for MNC to establish a dominant position in the WVAS sector in Indonesia and an ability to expand into ‘new media’ market opportunities throughout Asia. Finally, we believe that this partnership represents not only a compelling cross-media platform, but one of the first genuinely credible efforts to create a regional cross-media player in some of the most exciting markets in Asia.”