Page 25 - AIB | The Chanel | Issue 2 2012

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people still regard Vietnam as an
extremely important market, going
forward.
Let's look at individual markets.
The key differentiator in all markets
is obviously the extent to which a
market is embracing digital and at
the end of the day that is a
consequence of broadband
infrastructure both wired and
wireless. So you see markets that
are very digital where the impact of
Over‐The‐Top is becoming much
more prevalent.
In Singapore for example where
there is good infrastructure and
also an appetite for overseas
content, the challenge from Internet
delivery of content that the
consumer is not paying for is a
concern to the traditional pay‐TV
operators. In markets such as India
where digitalization is just at the
very beginning and broadband
penetration is still very low, the
dynamics are very different. In this
region, we still have huge leakage
of revenue from piracy, in its many
different forms. What we are really
talking about is signal theft and
there are a number of markets
where that still happens ‐ India, the
Philippines, Indonesia, Thailand.
Would players be better off with an
FTA ad-supported model?
The issue is how do you get scale.
Advertising models require scale, it
takes time to build scale. TV
advertising is still very much
dominated by the terrestrial FTA
networks, pay‐TV does not have as
big a share of the pie as it should
have given the significant reach ‐
especially among more affluent
consumer groups. One of the
challenges for the pay‐TV industry
is to be able to articulate their value
to advertisers. Many of the
channels that we are talking about
are niche channels and therefore
they need to make their case to the
high end brands. It is also about
showcasing success stories of
where pay‐TV channel and
broadcasters have worked with
advertisers to deliver valued
solutions to a brandʹs needs,
beyond the 30 second spot, through
sponsorship and branded content.
Is the ratings system sufficiently
sophisticated?
Itʹs very variable and I think it
would be fair to say the whole
industry is facing a data issue. And
itʹs one that the industry needs to
address, as we get more and more
competition and we have the issue
of what the common currency is in
terms of measurement of audiences
across different media, not just TV.
Even more importantly advertisers
are seeking measures of true
engagement with consumers.
What is happening in China?
China remains potentially attractive
but a frustrating market for foreign
entrants. That is unlikely to change.
With the exception of the hotels
and foreign compounds it has been
impossible for foreign channels to
enter the market. What content
owners are looking for are other
ways of distributing their content,
and that may well be online. But
there are some challenges with
doing that, particularly in terms of
protecting that content.
From a domestic viewpoint we
are seeing new regulations on a
fairly regular basis ‐ restrictions on
the type of programming that can
be shown, restrictions as to how
much advertising can be shown
during prime time ‐ so TV remains
very challenged although still the
dominant media. The big
interesting story is whatʹs
happening online. If you look
forward five years, the anticipation
is that 40% of all advertising will be
online. With the merger between
Youku and Tudou you now have a
much more dominant online video
company.
Do you see more co-production
opportunities?
Yes, most definitely. The ongoing
trend is co‐productions both in TV
and in film. And that reflects a
realisation that entering the market
through any other means is really
very difficult. It provides an
opportunity to build relationships
and develop a brand.
What are the trends for VOD in the
region?
The big issue is still the threat of
illegal services, and this is a global
story. If as a consumer you hear
about a great new movie or TV
series that your friend on a social
network is recommending to you
and you canʹt find it anywhere
legally, people will find a way to get
access to it ‐ sadly often illegally. So
the potential for growth in VOD is
definitely there but that growth
may not be as quick as we might
expect, if the content is not made
available where people want it and
THE CHANNEL | ISSUE 2 2012 | 25
China
remains a
frustrating
market
for foreign
entrants
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