Asian Digital Pay-TV TV Homes Hits 71 Million

HONG KONG, October 28: At its annual convention in Hong Kong, the
Cable & Satellite Broadcasting Association of Asia (CASBAA) released data
showing that there are 71 million digital pay-TV homes in the region, out of a
total of 300 million pay-TV subscriptions.

“The increase in digital pay-TV market penetration represents a
tipping point for our industry in Asia,” said Marcel Fenez, the chairman of
CASBAA.

The rise in digital-TV penetration is good news for the cable and
satellite business as it battles the rampant piracy problem in the region.
“Digital pay-TV creates far greater transparency—what might be termed a
‘digital cushion’—which can slow the growth of pay-TV piracy, while
accurately tracking pay-TV subscriptions,” said Lee Beasley, the head of Media
and Entertainment at Standard Chartered Bank in Hong Kong.

Indeed, the Asian pay-TV markets with the lowest level of
piracy—and revenue leakage—are generally those with the highest
percentage of digital deployment. “For instance, Australia, Hong Kong,
Malaysia, Japan, Singapore and New Zealand are almost 100 percent digital and
have the lowest piracy levels,” said Beasley.

Digital infrastructure also allows pay-TV operators and cable
channels to find new revenue streams via added-value services like HDTV and
interactive offerings.

According to CASBAA, the uptake of digital TV is on the rise
region-wide, including in the key markets of India and China. India now has 8.5
million digital pay-TV households, while China is home to 34 million digital
cable connections.

“India’s digital pay-TV market has been driven by the recent
exceptional growth in the digital DTH market but, at last, with 1.7 million
digital cable subscriptions, India is finally taking off,” said Fenez.

China’s most recent growth was driven by the Olympics, and Fenez
notes, “the next trick will be to enable new premium content to enter the
market to encourage increased ARPU and to stimulate additional demand.”

CASBAA also revealed the findings of the 2008 Pay-TV Piracy Survey, conducted
in collaboration with the Creative Industries Division of Standard Chartered
Bank. The
net cost of pay-TV piracy in 2008 will top $1.7 billion, up from $1.5 billion
in 2007. “Nevertheless, this is in line with market growth while digital
deployment should slow piracy as net subscriptions continue to grow,” said
Beasley.

In India, the grey market for cable TV services—consisting
largely of connections that are under reported by operators—rose to $1.1
billion. In Thailand and the Philippines, two other problem spots, the theft
and unauthorized redistribution of cable programming will result in industry
losses of $184 million and $94 million, respectively.

—By Mansha Daswani