The Asian pay-TV crossed the 50 percent penetration rate a few years ago, indicating that the transition to digital is in full swing in most of the region. Asian consumers are finally loosening the purse strings to pay a premium for entertainment that they would otherwise not find on terrestrial TV. According to the recent Digital TV Asia-Pacific Forecasts report, pay-TV penetration will rise from 59.0% of TV households in 2014 to 68.4% in 2020, adding 142 million subscriptions to take the total to 642 million. China will provide 323 million pay-TV households by 2020, with India supplying a further 179 million.
China overtook Japan to become the most lucrative pay-TV market in 2012. India will take second place from 2020. Together China, India and Japan will account for two-thirds of the region’s $42 billion pay-TV revenues by 2020.
“People are looking for higher quality nowadays. They are willing to pay for consumption and enjoyment of higher quality,” says TVB Network Vision Limited VP of Content Management, Winnie Ngai.
With many pay-TV channel operators scrambling to provide compelling consumer propositions across linear and non-linear platforms, the focus is also on getting the right programming mix. Exposure to global channels through pay-TV services has led viewers to expect international standard content and image quality. This has raised questions among pay- TV operators on how much to spend on acquiring content from the U.S. and UK and how much to localise.
The growth of pay-TV is putting pressure on content providers to raise their games. Those who produce programmes that can run in any country will be the winners in a challenging marketplace.
Ever since the Comcast and NBCUniversal pay-TV channels came under the banner of Universal Networks International (UNI), the company’s regional managing director Christine Fellowes has spent time focusing on setting up the structure and refining the portfolio to take advantage of the industry’s bullish forecasts of growth.
NBCU’s cross-company “Symphony” initiative prioritises collaboration across the broader business to amplify awareness for key properties. Universal Channel aired the Fast & Furious movie franchise, leading up to the theatrical release of Universal Pictures’ Furious 7. Meanwhile, Universal Studios Singapore was also simultaneously involved in the promotion of the film.
“In addition to strengthening and increasing our commitment for ‘Express’ content from the U.S. and UK, locally relevant programming and ‘TV Everywhere’, we are focused on collaborating across NBCU’s various divisions and tapping expertise across the company,” says Fellowes.
The Indonesia Channel (TIC) has also amassed a portfolio since its launch on 2 June last year. The channel is now in over 53 million homes, with its newest partner MHz Worldview in the U.S. reaching out to another 44 million homes on various platforms.
The company spent the first year refining its on-air product and brand identity, and will begin brand marketing and promotion this June. “Partnerships with stakeholders in each country of distribution are key to our marketing success, and we plan to seek and support those partners,” says CEO Dalton Tanonaka.
‘Express’ content
‘Express programming’ has also become commonplace among the region’s biggest pay-TV brands. FOX International Channels (FIC) pioneered the day-and-date release model for a TV series with the first season of The Walking Dead. FIC now launches a multitude of shows across all genres and channels at the same time as the U.S. or its country of origin (ie. Korean content). For many shows, the broadcast time difference is now condensed to less than 24 hours. This move is in line with FOX’s brand promise of delivering content to viewers: ‘The Best. First.’
For example, FIC orchestrated an unprecedented day/date launch for COSMOS: A Spacetime Odyssey, roadblocking the premiere episode across more than 200 FIC channels worldwide simultaneously with the U.S. FOX launch. COSMOS was seen by more than 135 million people worldwide, making it the most-watched series ever on National Geographic Channels International as a result of the unprecedented rollout, 4-city global media tour and robust marketing campaign.
Tuner Inernational has also made it a priority to shorten the time subscribers have to wait to access buzz-generating titles like Gotham. Phil Nelson, Senior VP and Managing Director, North Asia and Southeast Asia-Pacific says that pay-TV providers have had to evolve quickly in order to meet the demands of audiences who are savvier than ever before and have ever-increasing ways to access content.
“Turner’s brands have invested heavily to ensure consistently high quality of content and curation, complemented by local languaging options, and delivered exclusively and quickly. In the case of Oh!K, our new Korean entertainment channel, we air localised drama series within one day of their original telecast in Korea – this is unprecedented in Southeast Asia. And on Warner TV, we have several high-profile series like Gotham and iZombie that arrive in Asia express from U.S.”
For carriers like StarHub in Singapore, OTT options have driven up the demand for current content.
A significant portion of StarHub’s content offers day and date entertainment across Hollywood, Hong Kong, Korean, Malay, Hindi and Tamil genres. For example, while StarHub subscribers have enjoyed Asian content concurrently with Hong Kong, Korea and Taiwan, HBO series Game of Thrones is shown at the same time as America on its platform. Amid market fragmentation and greater entertainment options for consumers, the number of StarHub’s pay-TV subscribers grew 2% YoY to 542,000 households in 2014. Its pay-TV revenue saw a similar increase of 3.2%.
While relatively new to viewers in Asia, AMC and Sundance Channel are looking to continue to expand its distribution on pay-TV platforms across the region. One of the biggest priorities is to offer first-run original dramas to audiences less than 24 hours after the U.S. premiere.
The second season of Halt and Catch Fire premiered on AMC on 1 June, with two highly anticipated new series Fear the Walking Dead and Into the Badlands to be aired later in the year. “This enables us to connect viewers around the world as they experience AMC’s freshest original productions together. It’s also a major benefit for platform operators to capitalise on all the marketing activity and social media conversations surrounding the launches of new series,” says AMC/Sundance Channel Global’s President, Bruce Tuchman.
More Viewing Screens
Pay-TV operators have also been experimenting with multiplatform rollouts, offering viewers on-demand and online access to programming on devices of their choice. The ubiquity of high-speed Internet is changing lifestyles and customers’ expectations. The market is moving towards IP-delivered content and innovations in order to reach more consumers effectively.
Turner, for one, works closely with its affiliate partners to create a TVE ecosystem to create a seamless viewing experience. Recent examples are the launch of the authenticated Cartoon Network Watch and Play app with TrueVisions in Thailand and Foxtel in Australia, as well as the Warner TV Encore catch-up service in Hong Kong with now TV.
“It is important that if a consumer pays for a TV subscription, they can have the same experience on a mobile device or second screen – and have access to that same content wherever they are and whenever they want it,” says Turner’s Nelson.
For Discovery Networks Asia- Pacific (DNAP), Charmine Kwan, VP, Programming, says that the advent of digital technology has opened more doors for pay-TV operators and consumers alike. “As we own a lot of our programming, it enables us to offer our content and channels across multiplatforms with ease, though we remain platform agnostic. Whether HD, VOD, or OTT – we will go wherever the operators and platforms are ready.”
Last year, the network spent USD$2 billion on content – more than three times the amount spent six years ago, and grew its portfolio of channels by 8%, resulting in close to 227 million viewers per month in Asia-Pacific.
At AMC Networks, adapting to the multiplatform era has been a priority area of focus for many years now.
In April this year, FIC announced at the Asia-Pacific Operators’ Summit that its key brands FOX, FOX Sports and National Geographic Channel would be made available over the top in partnership with leading platforms, including Avex in Japan, Tencent and its OTT partners in China, Astro in Malaysia and Cignal in the Philippines. These services range from SVOD, linear streaming to catch-up, and offer FIC’s content across all genres.
“Pay-TV in Asia is stronger than ever. Subscription growth is on an upwards trend year on year and is projected to continue to do so for years to come, according to Media Partners Asia. The industry has evolved to accommodate different viewing habits, launching various ‘TV Everywhere models’, catch-up services and OTT platforms, and these are all part of the pay-TV ecosystem,” says FIC.
Having embraced the trend of consumers demanding content on the go and viewing on personal screens, StarHub started offering multiscreen entertainment since 2013. With the increasing migration to fibre broadband, the IPTV service, StarHub TV on Fibre, will empower customers with innovative new features for a richer and more immersive viewing experience.
Likewise, UNI’s Fellowes says that the network is always looking at new opportunities and the possibility of scaling up in large markets via OTT and new, emerging technologies – both with existing partners and new players. UNI’s channels are now available as authenticated linear streamed simulcast services for broadband and mobile for Chunghwa Telecom (Taiwan), Telekom Malaysia’s HyppTV (Malaysia) and StarHub (Singapore).
“All of our channels are available for linear simulcast and we work alongside our partners to drive their business initiatives. In 2015, we will be focused on rolling out Catch- Up VOD and standalone OTT with selected partners.”
Going Local
DNAP has planned several ongoing enhancements to boost engagement with local viewers, advertisers and partners. This local-feed approach is a strategic move on a market-to- market basis that marries great global content with local flavour. “In Southeast Asia, we are deepening our local presence on-ground with new offices set up in key markets; we have also gone a step further with new split feeds for Discovery Channel and TLC in Singapore, Malaysia and the Philippines, as well as a dedicated Bahasa Malaysia-dubbed block on Discovery Channel during Astro’s primetime,” says DNAP’s Kwan.
Offering content that resonates locally also forges a better connection with audiences. One such example is the upcoming season of TLC’s hit series CAKE BOSS, which will have an episode featuring a cake to commemorate SG50 in Singapore.
StarHub developed home-grown brands such as E City and VV Drama, which in turn have become household names for Asian programming and dinner-time entertainment for subscribers. StarHub’s SuperSports brand houses locally-curated sporting channels, offering a comprehensive suite of sporting events across football, basketball, wrestling, and other key events.
HD Rollouts
Similarly to how pay-TV operators are aggressively embracing the functionality of multiplatform viewing, HD rollouts have progressed rapidly, and all major channels brands have been rushing into this space. With HD feeds, operators will be more compelled to carry content which can showcase the crystal-clear clarity of such technology.
As distribution technology improves and full digitisation takes place, this trend is only set to rise. On the consumer front, the uptake will also increase as HD becomes more affordable. HD will certainly increase and ultimately, it will become the only form of viewing that audiences will come to expect and receive.
Last year, DNAP expanded its offerings in India with the launch of two unique HD channels – TLC HD World and Animal Planet HD World. “With four times the clarity compared to SD, HD offers customers a more fulfilling viewing experience.
Consumers who have made the switch will want to stay on HD. The growth of HD continues to drive TV to become the core unit that viewers consume entertainment from, and demand naturally drives supply,” says Kwan. “Discovery is rapidly transitioning to HD across the region to ensure that our audiences receive the best viewing experience. In markets where HD platforms or operators are not yet ready, we are still continuing distribution of our channels in SD.”
Making channels available in HD is essential to strengthening relationships with platform operators, says AMC/Sundance Channel Global’s Tuchman. “Our priority is to partner closely with each platform operator to work with them to increase their subscriber base by offering exclusive, high quality programming. We currently offer both AMC and Sundance Channel to operators in SD and HD and will continue to do so in the months ahead.”
UNI has HD feeds for all of its channels in countries like Singapore. “As Full HD TV panel penetration increases, we naturally expect HD viewership to continue growing, which adds to an overall stronger audience base for channels, regardless of format,” says Fellowes.
