Thailand faces a new era as players tussle for a place in the future with a shift to digital broadcasting now the “big mission” for regulator, the National Broadcasting and Telecommunications Commission (NBTC).

For the NBTC, its Master Plan 2012 – 2016 aims to allocate broadcasting frequencies, regulate the market and set broadcast codes of conduct.

NBTC Commissioner Supinya Klanarong, says the goal is to transform Thailand from analogue to digital broadcaster.

“This is, I would say, a big mission – it’s a masterpiece of the NBTC, in terms of transforming analogue TV into digital television,” Klanarong told TV ASIA Plus. “Thailand is one of the very few countries in this region that still doesn’t have digital terrestrial TV; we still use the old antenna and that’s a problem,” she said.

Transformation in action
The NBTC, a creature of the 1997 Constitution, began work just 10 months ago, arriving slowly as vested interests and political powers delayed its formation. Now the NBTC has a key role charting the future for Thailand’s media industry. The NBTC is to start testing digital TV transmissions this year. Up to 50 new free TV channels are planned using existing radio frequencies. Also planned are SD, HD and 3D broadcasting, and mobile and Internet-based TV.

Under the NBTC plans, the first group of 10 digital TV (DTV) channels will be allocated to community service broadcasters, the next 10-15 channels for public services and the remainder for business or commercial services.

Deputy CEO of CASBAA John Medeiros, told TV ASIA Plus Thailand’s steps to “go digital” were welcomed. “It’s a very good thing from the point of view of people who are in the industry and Thai consumers as well, because they will have a lot more choices.”

The NBTC is to partially subsidise production of the set-top boxes required to receive the UHF signals with competition among all TV operators – analogue, digital, cable and satellite – centred on content.

The four digital license groups are classified under broadcasting, networking, broadcast facilities or infrastructure, and application services. Under the plans, potential digital TV operators will bid for the spectrum. A license fee of 2.0% of annual revenue is also required.

In pursuit of the platform niche market, the Mass Communications Organization of Thailand (MCOT), in 2010, together with Playwork launched Ving Broadband TV using MCOT’s 2.5-gigahertz broadband spectrum airing content ranging from free TV channels to premium and on-demand content. Ving offers on demand TV at 20MPS for US$29, and a premium service of 100 MPS at US$112 with hi-speed streaming. Content includes news, music, movies, travel, education, sports, variety, games and technology.

CASBAA’s Medeiros says benefits would also reach cable operator TrueVisions’ subscribers. “It’s a market place where there’s a lot more ways for people to access video content whether it’s over the internet or satellite cable or satellite from TrueVisions or other established or soon to be established providers,” he said.

Reports put the starting price at auction for a commercial digital TV service at around US$12 million per standard TV (SDTV) channel but up to US$50 million for a high definition (HDTV) channel.

Initial objectives
Under the plan, initially there would be 18 commercial SDTV channels, four HDTV commercial channels and 14 public SDTV channels on the spectrum. The existing TV concessionaires, BEC/ ThaiTV3, Channel 5, BBTV Channel 7, Modernine, NBT Channel 11 and Thai Public Broadcasting Service (TPBS), will be required to broadcast simultaneously in analogue and digital formats.

ThaiTV3’s executive director, Pravit Maleenont, says the station is ready for digital TV broadcasting.

The NBTC hopes to see up to 100 terrestrial digital TV channels operations within five years. But BEC vice president of finance, Chatchai Thiamtong, was cautious. “Digital TV is probably coming very soon,” Thiamtong said, but the number of entrants may be more limited. “The most effective barrier to entry of the broadcast industry …. It is very costly to enter because the burning rate is so high,” he said.

The real boost to Thailand’s cable and satellite industry came with the lifting of bans on international and local advertisers in 2006 and 2008 respectively, according to CASBAA in an industry paper. “The relaxation of the ban galvanised the industry,” CASBAA said. “The ability to finance content production with ad revenues allowed a host of new producers to enter the market and there was a flowering of new satellite TV channels, with Thai indigenous satellite channels increasing to over 160 in 2012 from just 30 in 2008.

Satellite and cable growth has been “staggering”, AGB Nielsen (Thailand) managing director, Suresh Ramalingam told local media. “With more than 11 million households subscribed to either satellite or cable TV, reaching the eyes of 44% of Thai consumers, this media segment is no doubt a force to be reckoned with,” Ramalingam said.

AGB Nielsen reported 22 million TV households, with 49% viewing programmes by traditional TV and 6.8 million or 31% via satellite dishes. There are 2.3 million households subscribing to local cable TV networks with 1.8 million (9.0%) subscribing to cable operator, TrueVision.

The Satellite Television Association (Thailand) predicts cable and satellite penetration will reach 80% of Thailand’s 20 million households from 50%. But CASBAA’s Medeiros warned the market may be headed for a period of consolidation. “Now, I would say, we’re in the shake-down phase where not all the indigenous satellite TV channels are going to survive. But you do have some players with substantial capability putting together substantial packages that are potentially appealing to consumers,” he said.

The absence of a regulator led to a stampede of entrants into both broadcast and cable/satellite TV markets. There has been a mushrooming of 6,000 unlicensed community and local radio stations, says NBTC Commissioner Klanarong. “Now people just occupy a frequency without (official) allocation – so sometimes there are interruptions, sometimes it’s very chaotic,” said Klanarong. “In television we also have more than 1,000 cable TV operators nationwide and we have up to three to four hundred channel providers of satellite TV – Thai – that are customers of (satellite operator) Thaicom.” The NBTC’s major challenge now is to corral delinquent operators under the NBTC’s regulatory control.

Heated competition
New entrants have included media/ broadcast giant GMM Grammy, as well as RS Productions and JSL, Global Media and Work Point Entertainment launching their own satellite TV. PricewaterhouseCoopers forecast that TV subscriptions and licence fees rose 13.7 % annually on average from 18.2 billion baht ($592 million) in 2011 to 28.7 billion baht ($932 million) by 2015. Such potential cash-flow has also attracted international channels and content providers and with the NBTC in place, investors from Taiwan and South Korea are also looking at the Thai market.

GMM Grammy through subsidiary GMM-Z, hopes to garner 150,000 pay-TV subscribers in 2012 with its 1 Sky set-top boxes. Grammy securing broadcast rights of the Euro-2012 football finals highlighted competition in the Thai market. Left adrift was TrueVisions, prevented from carrying the games on free-to-air channels it carries.

The newly formed cable operator Cable Thai Holding (CTH) is to invest 10 billion baht (US$320 million) to enhance fibre optic infrastructure network across Thailand. CTH is a collective of 350 cable TV operators aiming to boost the number of broadcast channels to 60 from 32. The group also intends to make a bid for the highly lucrative 2013 – 2016 series of Premier League Games, and compete against TrueVisions and Grammy-Z. CTH, under a contract with state telephone organisation, TOT plc, is to rent the fibre optics cables to provide services.

TrueVisions has also said it would add content to CTH’s services. “The cable TV industry will soon become borderless once we enter the ASEAN Economic Community (AEC),” said True Corporation’s chief executive Suphachai Chearavanont. “Co-operation with local companies helps us compete with other countries,” Chearavanont told local media.

In a further challenge to TrueVisions’ hold on the broadcast rights of the English Premier League; music and entertainment company, RS Plc, announced it was also throwing its name into the bidding pool. The others are GMM Grammy, Cable Thai Holding, the Malaysia-based Cubic Associated Group, Workpoint Entertainment as well as TrueVisions. Thai media said RS has already acquired broadcast rights to Spain’s La Liga seasons 2012 – 2014 and the Fifa World Cup 2014. Executives are forecasting sales of the RS TV set-top box worth 1,590 baht (US$51) to reach around 500,000 units.

At the same time, GMM Grammy has won the rights to broadcast matches from eight major football clubs through its satellite TV arm, GMM Z. The clubs include Liverpool, Manchester United, Arsenal and Chelsea from the Premier League; Real Madrid, and Barcelona from Spain; Italy’s AC Milan; and Borussia Dotmund in Germany. GMM Z is already the exclusive broadcaster of 120 Thailand Futsal Premier League matches in the coming season over 2012 – 2013.

But competition on the Thai TV airwaves remains between Thai TV3 and BBTV Channel 7. Nielsen Media data shows Thai TV3 is making inroads into Channel 7’s audience share. In July, Thai TV3 narrowed the gap to under 12 points. CIMB Securities, in a commentary, said Thai TV3’s outlook was positive set against management uncertainties at BBTV after long time executive, Surang Prempree, left BBTV at the end of 2011. Thai TV3 also gained in ad spending amid management changes at state broadcaster, MCOT Modernine. Thai TV3/ BEC’s Thiamtong says competition remains intense. “So we can say that competition between BEC and BBTV is basically the same as it was throughout the last 40 years. We are still the underdog; we are still trying to get into their turf,” he said.