{"id":3458,"date":"2015-06-22T00:00:00","date_gmt":"2015-06-22T00:00:00","guid":{"rendered":"http:\/\/worldscreen.com\/tvasia\/2015\/06\/22\/channel-hopping\/"},"modified":"2016-01-15T18:08:37","modified_gmt":"2016-01-15T23:08:37","slug":"channel-hopping","status":"publish","type":"post","link":"https:\/\/worldscreen.com\/tvasia\/channel-hopping\/","title":{"rendered":"Channel Hopping"},"content":{"rendered":"

\"\"This article originally appeared in the MIPTV 2015 issue of<\/em> TV AsiaPac.<\/em><\/p>\n

Localization, expansion and new competition are key concerns for Asia\u2019s top pay-TV channel operators.<\/em><\/p>\n

For Asia\u2019s pay-TV industry, 2015 is likely to be remembered as the year that OTT went from being a potential hiccup on the horizon to a very real concern (or a lucrative opportunity, depending on what side of the rights-ownership table you\u2019re on.) Netflix, after years of not talking about Asia at all, has landed in Australia and is arriving this fall in Japan, with other territories to follow suit as the streaming platform works towards completing its global rollout by the end of 2016. Another multi-country platform, HOOQ has rolled out in the Philippines and will be progressing to other territories throughout the year. Numerous local services in China, India, Thailand, Malaysia and other markets are starting to see traction.<\/p>\n

According to Media Partners Asia (MPA), which is behind the Asia Pacific Video Operators Summit (APOS) taking place in Bali this month, there will be some 977 million OTT customers in the region by 2020.<\/p>\n

\u201cThe market for the legal consumption of OTT services in Asia Pacific is at an early stage, with monetization models nascent in most countries,\u201d says Vivek Couto, MPA\u2019s executive director. \u201cAs barriers to entry reduce and broadband penetration increases, more disruptors are emerging and a host of new platforms are proliferating, though business models are not always scalable and issues such as piracy, content and platform operation remain problematic.\u201d<\/p>\n

As these emerging players begin to make waves, established cable and satellite channels are working hard to protect their turf\u2014from rolling out their own digital services to strengthening their packages for advertisers and battling it out for the exclusive rights to top-notch content.<\/p>\n

\u201cThe good news is, there are people who want to pay for television content,\u201d says Ricky Ow, the president of Turner International Asia Pacific. \u201cWhether it\u2019s OTT with the operators or with an independent player like Netflix, if we can try to enlarge that paying base, it\u2019s an opportunity for the whole industry.\u201d (It\u2019s worth noting that Turner\u2019s sister company, Warner Bros., is a partner in the new OTT platform HOOQ.)<\/p>\n

\u201cAny market where we can legally deliver OTT\u2014where there\u2019s a consumer need and it\u2019s not fueled by piracy\u2014represents an opportunity for us to take our content forward,\u201d says Prem Kamath, the deputy managing director for the Asia Pacific at A+E Networks. \u201cWe do own a lot of the content ourselves, so we tend to have the rights to exploit it not just on linear television, but also across OTT.\u201d<\/p>\n

As for the prospects for stand-alone OTT entities, Kamath notes that there are likely to be plenty of hurdles ahead. \u201cPay TV is still growing, penetration is not that high and ARPUs are not at the levels they are in the U.S. or Australia. There are a lot of local affiliates ramping up their own TV Everywhere (TVE) and OTT offerings in order to try and preempt the entry of platforms like Netflix.\u201d<\/p>\n

Bruce Tuchman, the president of AMC Global and Sundance Channel Global, notes that his business has \u201cprospered because of the traditional pay-TV ecosystem,\u201d adding that parent company AMC Networks was once part of U.S. cable operator Cablevision. \u201cOTT is a challenge because it creates another way for people to watch programming. Should the pay-TV ecosystem not continue to prosper, that represents a loss of revenue\u2014revenue that has helped people like us invest in quality programming. So we want to make sure that these two technologies don\u2019t collide, but work harmoniously together.\u201d<\/p>\n

Tuchman doesn\u2019t see an immediate threat of OTT eating into traditional pay-TV revenues in Asia. \u201cOne of the reasons Netflix has done so well in the U.S. is that there\u2019s typically a giant cost disparity [with the price of subscribing to cable]. It\u2019s not quite as large across Asia; in some instances it\u2019s not significant at all. It also takes a very robust broadband infrastructure, which you don\u2019t have everywhere in Asia. There are many organic reasons why OTT might develop a lot differently in Asia. The challenge for the existing channels and operators is to up their game: better navigation and authenticated TVE and VOD. We do a lot of that with our operators.\u201d<\/p>\n

Making sure their content is accessible on a variety of platforms is standard operating procedure for all of the region\u2019s leading pay channel operators.<\/p>\n

\u201cWe have launched our own OTT\/TVE service in the region through our regional websites,\u201d states Alexandre Muller, managing director at TV5MONDE Asia Pacific. \u201cIt offers up to four live channels, VOD and catch up on multiple devices.\u201d<\/p>\n

Sony Pictures Television Networks, Asia is working with its affiliate partners to get content from its brands, including AXN and SET, onto operators\u2019 TVE extensions. It\u2019s \u201can opportunity to strengthen your brand with viewers,\u201d says Hui Keng Ang, senior VP and general manager. \u201cThe key is to identify a viable business model and the optimal way to monetize the platform. Given the fragmented nature of the region, it\u2019s a tricky proposition, but one that we as an industry need to solve, quickly. The key is to build digital infrastructure and assets that can generate long-term margins.\u201d<\/p>\n

TVE has been a growth story for Universal Networks International\u2019s (UNI) Asia-Pacific business over the past year. \u201cWe are always looking at new opportunities and, given the ever-changing nature of consumers accessing content, we are excited by the possibility of scaling up in large markets via OTT and new, emerging technologies\u2014both with our existing partners and new players,\u201d says Christine Fellowes, managing director for the region. \u201cOur channels are now available as authenticated, linear streamed simulcast services for broadband and mobile on Chunghwa Telecom in Taiwan, Telekom Malaysia\u2019s HyppTV and StarHub in Singapore.\u201d<\/p>\n

This year, Fellowes adds, delivering catch-up VOD through UNI\u2019s operator partners is a primary objective.<\/p>\n

One of the newer entrants to the region, RTL CBS Asia Entertainment Network, has been, since its inception, \u201c100 percent focused on a 360-degree content approach and making all our content available via all access methods,\u201d says CEO Jonas Engwall.<\/p>\n

\u201cA huge amount of content in Asia today is consumed via mobile and the internet,\u201d Engwall notes. \u201cUnfor\u00adtunately, the bulk of this is via pirate websites, partly as a result of the industry lagging behind consumer behavior, but also due to a generally \u2018relaxed\u2019 approach towards piracy throughout Asia. RTL CBS Asia is one of the few international networks that offers all content on all platforms, which is one key element of combating piracy.\u201d<\/p>\n

RTL CBS is one of a number of channel operators employing a day-and-date strategy with programming, releasing shows as close to the U.S. airdate as possible. House of Cards<\/em> is a recent example. \u201cWe aired season three on the same day as its U.S. release and showed all 13 episodes back-to-back, which hasn\u2019t been done in Asia before,\u201d Engwall says.<\/p>\n

FOX International Channels (FIC) premiered Battle Creek<\/em> on FOX in Hong Kong and Southeast Asia on the same day as its U.S. launch. In addition, the Asian FOX feeds will be part of the global day-and-date rollout of Wayward Pines<\/em> in May.<\/p>\n

For the return of Game of Thrones<\/em> this month, HBO Asia subscribers will be able to watch the new season at the same time as viewers in the U.S. Episodes will premiere in Asia in the morning, with an encore broadcast in prime time.<\/p>\n

\u201cThe simultaneous airing of new seasons and brand-new original programs as the U.S. will help with our continued fight against piracy, and end the angst of reading about show spoilers on social media,\u201d says Jonathan Spink, HBO Asia\u2019s CEO.<\/p>\n

\u201cExpress\u201d programming has been a pillar of Fellowes\u2019 strategy at UNI. \u201cTitles like DIVA\u2019s Downton Abbey<\/em>, Universal Channel\u2019s Chicago Fire<\/em> and Syfy\u2019s Sharknado<\/em> franchise\u2014as well as up to 90 percent of E!\u2019s first-run programming\u2014are given this \u2018Express\u2019 treatment,\u201d she says.<\/p>\n

THE LOOK OF ASIA<\/strong>
\nThe best of American and British programming has certainly boosted the fortunes of many entertainment channels in Asia, but local relevance has become just as important as the market gets more crowded\u2014and OTT platforms become more aggressive in securing the rights to high-end imports.<\/p>\n

FIC is producing a wealth of content across its brands in the region, from FOX Sports to National Geographic Channel to STAR World. It has been particularly active in Chinese-language entertainment over the past year or so for its SCM and SCC channels.<\/p>\n

\u201cWe do a lot of productions in Taiwan and Hong Kong, leveraging our relationships in China,\u201d says Joon Lee, managing director for Hong Kong and Southeast Asia at FIC. \u201cWe are expanding our local productions in Taiwan, Hong Kong and to some extent Singapore. We have this project called \u2018Go Local!\u2019 where we set aside a fund to sponsor young, talented independents to make locally relevant films. Many of the funds out there are moving towards China, so the creative talent in Taiwan and Hong Kong and Singapore are left out somewhat.\u201d<\/p>\n

UNI has placed an increased emphasis on local programming over the last 12 months. E! recently premiered its first-ever Malaysian miniseries, Facing Up to Fazura<\/em>. Out of the Philippines, E! rolled out the reality series It Takes Gutz to be a Gutierrez<\/em>. Launching in June on Syfy will be the second season of The Paranormal Zone<\/em>. DIVA has commissioned a local version of the lifestyle format How Do I Look?<\/em> And in Australia, E! has renewed Fashion Bloggers<\/em> for a second season.<\/p>\n

AFFILIATE RELATIONS<\/strong>
\n\u201cWe have also strengthened our partnerships across the region, collaborating with operators to bring our brands and talent closer to subscribers,\u201d Fellowes says. \u201cWe facilitated Astro\u2019s production of two 30-minute, L.A.-focused specials, helmed by Malaysian TV personality Aznil Nawawi, arranging exclusive interviews with E!\u2019s Kim Kardashian, Giuliana Rancic and Christina Milian. And, to promote the premiere of Tricked<\/em> on Universal Channel on Telekom Malaysia\u2019s HyppTV, we brought British magician Ben Hanlin down to Kuala Lumpur. We\u2019re committed to bringing our brands closer to their fans.\u201d<\/p>\n

AXN this March premiered a pan-Asian version of FremantleMedia\u2019s Got Talent<\/em> format. Local productions, Sony\u2019s Ang says, have been beneficial to the company\u2019s ability to serve its advertising clients.<\/p>\n

\u201cMore than ever, advertisers are looking to maximize their budgets with campaigns that go beyond the traditional 30-second spot and, given our diverse and fragmented market, they are looking for high-impact, multiplatform regional campaigns. Asia\u2019s Got Talent<\/em> is a great example of how we\u2019re delivering on these expectations, with our regional partner brands seamlessly integrated into the show.\u201d<\/p>\n

FOLLOWING THE MONEY<\/strong>
\nA+E\u2019s Kamath also points to local productions, among them Photo Face-Off<\/em> on HISTORY and Mom\u2019s Time Out<\/em> on Lifetime, as having helped boost ties with ad clients. \u201cLocal productions help us drive fairly steady and strong ad-sales growth. And as an overall trend, we\u2019re seeing advertising going more local. There are more companies and brands that are really looking at localizing their ad spend, rather than doing it on a pan-regional level. That\u2019s a trend you\u2019ll see gathering steam as we go forward. That is why most broadcasters are looking at localizing their product offerings as well.\u201d<\/p>\n

\u201cIt\u2019s a local ad-sales story,\u201d affirms Turner\u2019s Ow. \u201cIt\u2019s hard to say how [the overall market is] because when one country is down, another one is up. But as a whole, we\u2019re still seeing growth in ad sales.\u201d<\/p>\n

Channels are also seeing subscriber gains as the pay-TV businesses develop in emerging markets such as Indonesia and Vietnam.<\/p>\n

\u201cTV5MONDE added 13 million new subscribers to its channel in the region over the last year,\u201d Muller says. \u201cThere are still massive growth opportunities across the region as new operators are appearing every day. Furthermore, there are still margins to grow in each of the traditional markets for our brands, and there are also plenty of possibilities in smaller ones like Myanmar, Bangladesh and Cambodia.\u201d<\/p>\n

Scripps Networks Interactive, which has only been active in Asia for the last few years, is exploring opportunities across developed and emerging markets. \u201cFor mature markets, we offer a great way to enhance [a pay-TV platform\u2019s] portfolio at minimal cost to reach additional customers,\u201d says Derek Chang, managing director for Scripps\u2019 Asia-Pacific business. \u201cFor emerging markets, our brands enhance their ability to educate consumers on the value proposition of pay TV.\u201d<\/p>\n

A+E Networks\u2019 Kamath is not discouraged by markets like the Philippines or Indonesia, where growth in pay TV has not moved as fast as those working in the industry would like.<\/p>\n

\u201cWe have yet to see the peak of the pay-TV market in most of the territories we operate in,\u201d Kamath says. \u201cHaving said that, a key challenge for us is balancing the whole aspect of regional versus local. The way most broadcaster businesses are structured right now is that we operate pan-regional beams. We\u2019re starting to localize in certain markets. As we become more and more local, balancing out the economies of scale that a regional beam offers remains a challenge.\u201d<\/p>\n

FEEDING FRENZY<\/strong>
\nLaunching more local feeds to tap into local ad buys is a priority for many channel operators. A number are also launching new brands. Scripps recently added to its portfolio with HGTV Asia. \u201cThe launch of HGTV in Asia is the first-ever expansion of HGTV outside North America,\u201d Chang says. Following the launch in Singapore, HGTV Asia has secured carriage in Australia, the Philippines and Mongolia. There have also been new launches for Asian Food Channel and Food Network.<\/p>\n

\u201cOur priority is to continue to build scale for the division in well-developed markets where Scripps Networks has a presence\u2014such as Singapore, Malaysia, Philippines, Indonesia, Hong Kong, Taiwan, Thailand and Vietnam,\u201d Chang adds. \u201cWe are also focused on growing our distribution in markets where we have had more limited distribution, like Australia, New Zealand, India, Japan, Korea and China.\u201d<\/p>\n

Turner\u2019s Ow sees continued room for growth in the kids\u2019 business, following the positive reaction to the Toonami and Boomerang launches in 2014. \u201cWe\u2019ve launched a POGO block in Thailand on one of the main terrestrial channels. I think that will help us to really build up our kids\u2019 business in Thailand in a big way. Last year we opened the Cartoon Network Amazone water park in Thailand, in addition to launching Toonami Thailand, a completely local-language channel. In Australia, we have launched an authenticated version of Cartoon Network Watch and Play for existing Foxtel subscribers. We\u2019re also looking to launch a new Cartoon Network app that hosts content that will be totally different from the main channel. It will be short form. The app is not authenticated. It\u2019s advertising driven. It\u2019s getting the brand in front of the kids, even if they are not pay-TV subscribers.\u201d<\/p>\n

On the entertainment front, meanwhile, rollout continues on the Oh!K Korean channel, and Warner TV has been relaunched with a new on-air look to appeal to a slightly younger demo with series like iZOMBIE<\/em> and Gotham<\/em>.<\/p>\n

TV5MONDE has just launched a new channel, delivering French lifestyle content, subtitled in English and Chinese.<\/p>\n

AMC\u2019s Tuchman expects to see continued traction on Sundance Channel and the more recent AMC, which replaced MGM. \u201cWe do interesting first-run, independent, unconventional content that is going to keep a lot of younger people, potential cord cutters, glued to the television to watch things that they can\u2019t find anywhere else,\u201d Tuchman says. \u201cThat\u2019s what Sundance and AMC represent in these more challenging markets. The biggest opportunity for us is to stand behind these premium brands and the original content people want. Unless things change drastically, what\u2019s clear is that audiences flock to great original products. If you don\u2019t have original products, you may not survive. If you secure and broadcast compelling, original product, you\u2019re still going to be able to build audiences in an increasingly fragmented and distracted world.\u201d<\/p>\n

Ultimately, whether you\u2019re a new entrant in Asia\u2019s multichannel market or an incumbent, the following words from RTL CBS\u2019s Engwall apply. \u201cWe have to try harder, do better than the competition, and be bolder in our approach in making ourselves seen and heard in the region.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

This article originally appeared in the MIPTV 2015 issue of TV AsiaPac. Localization, expansion and new competition are key concerns for Asia\u2019s top pay-TV channel operators. For Asia\u2019s pay-TV industry, 2015 is likely to be remembered as the year that OTT went from being a potential hiccup on the horizon to a very real concern …<\/p>\n","protected":false},"author":1,"featured_media":3459,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[75,76],"tags":[80,82,81],"class_list":["post-3458","post","type-post","status-publish","format-standard","has-post-thumbnail","","category-analysis","category-features","tag-apos-2015","tag-ott","tag-pay-tv"],"yoast_head":"\nChannel Hopping<\/title>\n<meta name=\"description\" content=\"Channel Hopping. Localization, expansion and new competition are key concerns for Asia\u00e2\u0080\u0099s top pay-TV channel operators.. 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