CONVENTION 2011: A NEW CONVERSATION

TV UPFRONTS: THE SINGAPORE SCREENINGS

SAT TV: ITS AMAZING BEGINNINGS

PAY-TV REGULATION: OVER THE TOP?

COUNTRY REPORTS: KOREA, INDONESIA www.casbaa.com Volume 6 Number 4

Hong Kong Executive Office 802 Wilson House, 19-27 Wyndham Street, Central, Hong Kong Tel: +852 2854 9913 Fax: +852 2854 9530 Email: [email protected] CASBAA CONNECTIONS CASBAA

India Office Flat. No. 3, Ground Floor, Tower Block, Sagar Apartment, 6 Tilak Marg , New Delhi-110001 Tel: +91 11 45137938 Fax: +91 11 47540892 Email: [email protected] CASBAA Calendar 2012

Date Event / Meeting Venue Jan 31 (Tue) Board of Directors Meeting Hong Kong

Feb 22 (Wed) Council of Governors Meeting Hong Kong

Feb 22 (Wed) CASBAA Hong Kong

Feb 29 (Wed) Indonesia Roundtable

Feb Taiwan Briefing Taipei

Mar 20 (Tue) India Forum New Delhi

Mar 21 (Wed) BoD Doorknock New Delhi

Apr 12 (Thu) BoD Doorknock Tokyo Apr 18-19 CITVC/CCTV Digital Briefing Hong Kong May 10 (Thu) BoD Doorknock Bangkok May 16 China Overseas Networks Showcase Beijing May 21-23 CASBAA/NCTA Breakfast Boston May 22 (Tue) Digital Matters Singapore May Korea Roundtable Seoul Jun 18 (Mon) Satellite Industry Forum Singapore Jun 19 (Tue) Council of Governors Meeting Singapore Jul 19 (Thu) Board of Directors Meeting Hong Kong Sep 18 (Tue) Council of Governors Meeting Hong Kong Sep 18 (Tue) CASBAA Mixer Hong Kong Oct 4 (Thu) Board of Directors Meeting Singapore Oct 29 – Nov1 CASBAA Convention 2012 Hong Kong

Nov 1 (Thu) Charity Ball Hong Kong Nov 1 (Thu) Annual General Meeting Hong Kong

Nov 1 (Thu) Council of Governors Meeting Hong Kong Nov 26 (Mon) Hanoi Strategy Meeting (BOD) Hanoi Dec 6 (Thu) Board of Directors Meeting Singapore Dec 6 (Thu) CASBAA Mixer Singapore CONTENTS

22 REPORTS Satellite TV 22 The amazing beginnings of Asian Sat TV Regulatory Brief | OTT 27 How regulators can rebalance a tilted playing field

Upfronts 31 The digital gap some players still must bridge 38 Country Reports 34 Previews of Korea and Indonesia “In View” surveys

Look who’s talking 42 38 How technology has brought new people into the conversation

NBCU’s bigger focus on Asia, 39; SK Telecom’s long view of China, 41; ’s call for TV to get smarter, 43; Japan and how it’s open to new business, 45; Made in Malaysia, 47; BBC Worldwide on iPlayer’s part in the plan, 49

CASBAA Profiles 58 51 Andrew Jordan on broadcast association’s evolution CASBAA Convention 2011 Album 55 Lunch views, 57; Charity Ball, 58; Networking parties, 60

Volume 6, Number 4

CASBAA Connections is published quarterly by CASBAA, the association for digital multichannel television, content, DEPARTMENTS platforms, advertising and video delivery across Asia, on behalf of its 130 member companies serving the region‘s 2 Board and Council 3 billion multichannel viewers. Copyright © 2011 3 Chairman’s Report Marcel Fenez, Chairman; Simon Twiston Davies, CEO; John Medeiros, Deputy CEO; Jill Grinda, VP, Operations; 12 Media Grabs Anjan Mitra, Director, India; Adela Chen, Director, Marketing & Communications; Amanda Yang, Director, Events; Tammy Choy, 15 Briefing Head of Administration. Executive Office: 802, Wilson House 65 By the Numbers 19-27 Wyndham St, Central, Hong Kong Telephone: +852 2854 9913 68 Committees Email: [email protected] Website: www.casbaa.com 71 CEO Memo

CASBAA Q4 2011 1 BOARD AND COUNCIL Board of Directors

CHAIRMAN CHRISTINE FELLOWES MARK PATTERSON Robert Gilby ANDREW JORDAN MARCEL FENEZ Universal Networks GroupM Disney Media Distribution GE Satellite PwC International (AP)

JONATHAN SPINK JANICE LEE SOMPAN STEVE MARCOPOTO SIMON TWISTON DAVIES HBO Asia PCCW CHARUMILINDA Turner Broadcasting System CASBAA TrueVisions Asia Pacific

ELIAS ZACCACK WARD HANSFORD NEIL MONTEFIORE Council of Governors SES WORLD SKIES (Patron) Ericsson (Corporate) StarHub (Corporate)

ALAN HODGES GARY GROENHEIM Seow Eng Goh MANU SAWHNEY STEVE GARTON AETN International (Patron) Bloomberg Television – SingTel (Patron) ESPN STAR Sports Synovate (Corporate) Asia Pacific (Patron) (Corporate) ROCH PELLERIN RICKY OW SUNIL LULLA Al Jazeera Network TOM KEAVENY Sony Pictures Television ARJAN HOEKSTRA Times Television Network (Patron) Discovery Networks Asia (Patron) Eurosport (Corporate) (Corporate) Pacific (Patron) HUANG BAOZHONG DEEPAK JACOB BRICE BERTRAND BELINDA LUI APT Satellite (Patron) DEEPAKJIT SINGH (Patron) France24 (Corporate) Time Warner (Corporate) Encompass (Patron) RICHARD BOWLES WILLIAM PFEIFFER DARBY SANCHEZ JEREMY KUNG Arianespace (Patron) WARD PLATT Tiger Gate Entertainment Globecast (Corporate) TM (Corporate) Fox International Channels (Patron) SREEDHAR (Patron) GABRIELA KENNEDY ALEXANDRE MULLER SUBRAMANIAM JAMES ROSS Hogan Lovells (Corporate) TV5MONDE (Corporate) Asian Broadcasting JOHN HUDDLE Trace TV (Patron)/Lightning Network (Patron) Intelsat (Patron) International PJ WONG CHRIS HOARE iMediaHouse Asia/Focus VIACCESS (Corporate) THOMAS CHOI BENGT JONSSON JESSE CHANG Media (Corporate) Asia Broadcast Satellite Irdeto (Patron) TransAsia Lawyers (Patron) (Patron) PAUL BROWN-KENYON AUGUSTUS DULGARO LAURENCE PEAK MEASAT (Corporate) BILL WADE ITV Global Entertainment Verimatrix (Patron) AsiaSat (Patron) (Patron) NIGEL FRANCIS INDRA SUHARJONO Minter Ellison (Corporate) ROHANA ROZHAN BEN WAY Viacom (Patron) (Patron) Macquarie Group (Patron) JOE WELCH ANURRADHA PRASAD News Corp (Corporate) BRUCE DOVER TANAWAT WANSOM BAG NETWORK Australia Network (Patron) MCOT (Patron) (Corporate) HANS-GUNTHER HERRMANN MARK WHITEHEAD SUE TAYLOR GREGG DAFFNER Paul, Weiss, Rifkind, Wharton BBC Worldwide (Patron) NDS Asia Pacific (Patron) EchoStar (Corporate) & Garrison (Corporate) CHAIRMAN’S REPORT

Regulators can mitigate some of OTT’s negative impact on traditional television revenues Beyond the horizon Takeaways from Convention 2011 and thoughts on the year ahead

s the multichannel TV industry in all its growth economies and large, more established forms enters 2012, and it becomes even markets where multichannel TV still has plenty easier for consumers to gain access to of opportunities for growth. An obvious example content by over the top television and is Japan which had a significant presence at the otherA means, enlightened, regulation becomes convention. So watch for CASBAA initiatives here. more critical. Indeed, we’re convinced that regulators can mitigate some of the negative impact he looming challenge for much of the pay- on traditional television revenues. TV industry is the possibility of a slowdown That’s why the CASBAA message during Tresulting from the contraction in consumer Convention 2011, “regulate for tomorrow, not just spending. Will we see the trimming we’ve seen today”, really must be embraced by governments. in other geographies? The prevailing perception Otherwise, operators using traditional delivery seems to be that we will be less impacted by slower methods will rightly conclude they are being growth than other markets. disadvantaged by dated regulations that new This brings me to advertising. While there may entrants are to ignore. be opportunities to pick up more of our fair share, Looking back on CASBAA Convention 2011 and ATAC will continue to be at the forefront of this more generally, there were several takeaways, and effort, ad budgets look at best uncertain as we go two of them were especially encouraging. The into FY12. But whatever unfolds, I’m pleased to say first was just how much we’ve changed in the 12 we’ll have expert guidance from Group M’s Mark months since the last annual meeting. Patterson who was elected to the Board during the This year the industry was more prepared AGM and Council Meetings on November 3rd. to engage with new entrants, people and organizations who in the past might have been e will shortly be reviewing CASBAA’s perceived as outright enemies. This came across internal structures, including the Board again and again in the tone of the discussions. Wand Council, to ensure they remain as People seemed to be saying, in effect, if this is responsive and relevant to members as possible. where the world is going, let’s look for ways to We do this every few years and a review seems really build something new. especially appropriate on the heels of our 20th A second takeaway was the upbeat mood. anniversary. Despite obvious threats on the horizon, the sense Everyone knows part of CASBAA’s remit is I had talking to delegates and speakers was that, representing our industry, advocating positions overall, it’s been a good year for the industry. before regulators and other groups. We are also It’s been a good year for CASBAA too. Our tasked with connecting people within our industry membership growth in India highlights still and I can’t think of a better way of doing that than intensifying international interest there and the working on a committee, so I encourage everyone rising power of the Indian industry itself. This to get involved. is unlikely to let up as digitalization continues, Finally, I’d like to offer my thanks to the CASBAA ensuring India remains a key CASBAA focus. Executive Office for bringing off another terrific We also did some growing at the other end of Convention on top of a terrific year; and my thanks our footprint as more Japanese companies, not least to the members of the Board and Council for the flagship broadcaster NHK, join our ranks. We’re support that made that tremendous effort possible. fortunate in attracting members from both high- Marcel Fenez

CASBAA Q4 2011 3

MEDIA GRABS Regulation takes the spotlight

t’s hard to remember a time when regulatory issues city state’s regulatory slip to a 70% rating, which had it so dominated the news cycle, and credit for the trailing Malaysia. (The downgrade was laid to Singapore’s headlines in the FT and other publications must introduction of cross-carriage regulations effectively go to CASBAA’s recently released Regulating for ruling out exclusive broadcast of big ticket programs, IGrowth 2011 (RfG) report. That got the media buzzing crimping free market competition just a bit.) on issues like piracy, the cost of which CASBAA totes up To be sure it got a good airing, RfG was released in every year. time for CASBAA Convention 2011. There the chatter was RfG’s “scorecard” rating Asian regulatory regimes about OTT TV which got oodles of ink – as did Richard was also widely reported. Bloomberg Businessweek Li, honored with CASBAA’s Lifetime Achievement Award was one of many organizations that covered it, as was for getting off the ground in Asia. See Singapore’s Business Times – which highlighted the www.casbaa.com to see clippings in full.

• Campaign Asia P acific, Sep 28, 2011 2011 Sep 28, • W ApId Tv nEWS, orld Screen, • r • Afaqs!, Sep 28, 2011 Sep 29, 2011

• The Business Times, , 2011 • Bloomberg Businessweek, Sep 29, 2011 .com, Sep 28 Sep 29, 2011 • Indiantelevision Sep 29, 2011 • Yahoo! 7 Finance,

• Hong Kong Economic Journal, Nov 7, 2011 • Financial Times, Oct 5, 2011 , Sep 28, 2011 • Cable Quest Nov 2, 2011 • Broadband TV News, 12 CASBAA Q4 2011 • C ontent + Technolog Nov 3, 2011 y, Nov 9 • ClickZ.asia, , 2011 y, Nov 3, 2011 • Sing Tao D • Apple Dail aily, Nov 15, 2011

• Content + Technology Magazine, • Indiantelevision.com, Dec 1, 2011 World Screen, ews, Dec 1, 2011 Dec 1, • Dec 2, 2011 • Rapid TV N 2011

• Business Nov 2, 2011 • IndianTelevision.com, Standard, Nov 1, 2011 Nov 1, 2011 • Advanced Television, Nov 2, 2011 • The Financial Express,

• RTHK, Nov 22, 2011 , 2011 • The Economic Times, Oct 7, 2011 ews Asia, Nov 1 • Channel N Nov 1, 2011 • Bloomberg,

, 2011 • Yahoo! Singapore Finance, • Sina etwork, Nov 16 Nov 10, 2011 Taiwan, Nov 16 • JCN N Nov 16, 2011 • Media Mughals, , 2011

CASBAA Q4 2011 13

briefing Japan entry wins Child Rights Award content these days. Asahi Shimbum says that in 2003 the value of imported Korean programming was US$6.28m; by 2010, US$81.6m. Korean imports are cheap compared to expensive Japanese productions, Japan’s leading daily says, and that explains their growing popularity among broadcasters, especially satellite broadcasters. With few restrictions on foreign content, Japan now accounts for about 60% of Korean program export earnings, Asahi says. "Japan has excluded foreign programs through market competition alone,” notes a media studies academic quoted in Disabled: Iori and Ibuki, are the subject of the 2011 Child Rights the report published on September 20th: “It is a Award documentary special case in international terms." It would seem so and it is in this context that ompeting in a field of more than Tetsuo Yamakawa’s presentation at CASBAA 50 entries, Shizuoka Telecasting’s Convention 2011 becomes especially interesting. documentary on disabled siblings won The Vice-Minister for Policy Coordination in Japan’s the 2011 Asia-Pacific Child Rights Ministry of Internal Affairs and Communications Award.C The award, inaugurated by CASBAA, ABU contrasted Japan’s openness to the quota setting that and UNICEF in 2001, is given annually to the best goes on elsewhere in Asia. television program focusing on children’s rights In Korea, Yamakawa said, domestically produced in the Asia-Pacific. It was presented produced programs must account for at least 80% November 2 at CASBAA Convention 2011. of terrestrial airtime. In mainland China, he said “Iori and Ibuki – Why We Were Born” follows foreign programs cannot go beyond 25% of the the lives of a blind girl, Iori, and her younger, physically and mentally handicapped brother Ibuki who has the sad distinction of having been CASBAA Cares about Kids hospitalized 33 times. Much more important though is his capacity to repeatedly bounce back, turning himself into an enduring source of strength for sister Iori and their parents. This year’s entries came from Bangladesh, Bhutan, mainland China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, Mongolia, New Zealand, the Philippines and Thailand.

Wide open Japan L-R: CSR Committee Co-Chair, Doug Fraser, Australia Network, Simon Twiston Davies, CEO, CASBAA and James Murray, CEO, Visitors to Japan can grow old looking for an Plan International Hong Kong ATM that accepts foreign cash cards, or trying to plug their mobiles into local networks. The global Members of the multichannel TV industry in the Asia template nearly always gets a good overhaul in Pacific have rallied to raise more than US$72,000 Japan. Even familiar lay-bys like McDonald’s or the for Plan International Hong Kong through a corner 7Eleven, each one immaculate and freshly combination of individual and corporate donations stocked, turn out to be as Japanese as bullet trains. at events during the annual CASBAA Charity Ball Consumers expect it. But not so foreign TV presented by Turner at the CASBAA Convention content: Japanese are largely happy to take what 2011. comes in as delivered, especially if it is Korean

CASBAA Q4 2011 15

total broadcast time, and no more than 15% of prime time terrestrial broadcasts. For terrestrial Fair regulation’s broadcasters In Taiwan, domestic programs have to account for at least 70%. (See also Convention coverage beginning on page 42.) upside All this imported music and drama doesn’t Leaving a few weeks to digest sit well with everyone in Japan. Fuji Television, the facts before CASBAA which airs Korean fare 38 hours a week, twice the Convention 2011, CASBAA amount of competitor Tokyo Broadcasting System, released the third edition of its drew 5,000 protesters to its door last summer. They “Regulating for Growth” (RfG) charged the broadcaster with cultural betrayal and survey of pay-TV regulation, insisted it cut back Korean programs and air more policies and practices. As Japanese dramas. sketched in these pages Still, that’s a drop in the bucket compared to the before, RfG measures number of Fuji viewers who aren’t complaining. regulatory market-friendliness, or lack

New faces for CASBAA

GEO TV

CASBAA has added 24 new members (including music and digital content, also joined as corporate upgrades) this year to its growing roster of over 130 members. international and influential organisations. Most In other membership news, French-based recently, Japan’s NHK World TV, serving 137m multicultural broadcaster TRACE has upgraded its households in 120 countries and a unit of one of the membership to Patron status and Jeremy Hall-Smith region’s largest broadcast organizations, joined as a joined as an Individual member corporate member along with TATA Communications, “Our members deliver video in multiple formats to a global provider of communications technology in all corners of people’s lives and impact entire business India. Malaysian media, telecom, technology and communities from broadcasters to manufacturers entertainment group Asian Broadcasting Network to professional services of all kinds,” said CASBAA joined as a patron member; Myanmar DTH platform CEO Simon Twiston Davies. “CASBAA’s goal is Forever Group, financial and business advisors KPMG to present a unified voice for the Asian broadcast India and Getty Images, the global services supplier industry to promote multichannel TV in the region and and creators and distributors of still imagery, video, internationally.”

CASBAA Q4 2011 17 of it, across 15 jurisdictions. (See RfG’s interactive update on trends in multichannel TV distribution, features at http://www.casbaa.com/rfg2011/.) audience numbers and viewership profiles. For a The compelling finding even for those who might taste of some of the report’s revealing numbers, see not otherwise care about the fortunes of multichannel our expanded By the Numbers section on page 65. video is that markets which support market-friendly Despite impressive industry growth data, CASBAA and/or neutral regulation invariably exhibit higher said piracy remains an abiding concern, and the levels of economic activity. “[Effective regulation] report provides a blow by blow breakdown of the benefits ancillary industries, local creators and content latest situation across each of the markets covered. producers, and tax collections,” CASBAA says. In round numbers, the global TV audience In the latest round in CASBAA’s triennial series, should reach nearly 4 billion about the time you the authors find that policies in some markets are read this; nearly 800m of these viewers are in Asia. improving in that they had become “more market- Advertising continues to grow in all regions, friendly, more pro-competition, more pro-growth”; led by the Asia Pacific. All four ad categories in others, they found the regulatory scene stagnant measured – television, radio, even newspapers and or worse: “Asia by now has some clear examples of magazines, are growing. TV leads the pack. regulation-induced pay-TV market distortions and The report notes that as advances in technology regulatory failure,” they say. change the way we consume (and measure TV To compare markets of vastly different sizes, performance), digital convergence is having a CASBAA plotted industry revenue and investment salutary effect on ad growth: as internet viewing data “per pay-TV household” across the region. grows, so too does online television advertising. Economic benefits aside, CASBAA says “Effective regulation also produces benefits for consumers, who – in the best-regulated markets – have access to new forms of content (HD television has grown markedly in the three years covered by this study), new Briefly... technologies (rollout of digital distribution systems UNDER-DECLARATION in a growing number of markets), and more choice Under-declaration of cable TV subscriptions is a big in what they view on what device and when. Huge problem in some Asian markets, but in other regions investments are necessary to create these consumer too. Officials in Colombia, for example, recently benefits, and investments flow where regulation proposed revoking the operating licenses of cable- permits predictable, economically sensible returns.” TV operators who under-declare by manipulating CASBAA argues regulation in the digital economy subs data to cheat both content providers and the must be even-handed to be effective. “Television today tax collector. Discrepancies can be huge. While is delivered to consumers in many forms and over Colombia’s government statistics department many different networks – cable, satellite, mobile, reported that pay TV reached 76% of households, telco “walled gardens” and broadband internet. (See the country’s National TV Commission reported that http://www.casbaa.com/rfg2011/ also Regulatory pay TV served only 31% of the population. What Brief, page 37.) The best regulatory systems recognize gives? “What gives, indeed – three cheers for the that the industry is rapidly changing, converging, and government for taking action against the crooks,” developing new multifaceted business models.” answered CASBAA CEO Simon Twiston Davies. “It Best practice requires a level playing field, it would be nice if the enforcement agencies in Asia says, plus regulators committed to applying the followed Columbia’s example.” same or similar rules to participants regardless of technologies or business models deployed. SARFT RESTRICTS ADS In late September, China’s State Administration for Radio Film and Television (SARFT) implemented interim rules on TV advertising, setting new CASBAA guidelines that relate to content, timing, insertion, and monitoring of advertisements. The new rules prohibit breaks for ads during programs in prime Update: time and set limits on how much advertising is allowed – 20% of broadcast time in non prime time, Distribution 15% during prime time. Broadcasters can break into shows only once – for 2.5 minutes – outside of prime-time. The regulator also imposed other and viewers restrictions, including a prohibition on spots for In November, CASBAA released its latest woman’s sanitary products during the supper hour.

CASBAA Q4 2011 19

CASBAA Q4 2011 21 SATELLITE TV

Very outside the box Michael Johnson remembers the incredible beginnings of satellite television in Asia

tart with little immediate street cred invest in economies where there was money to but chutzpah to burn, Michael Johnson earn, not in developing regions like Asia. “What are improbably cleared a long succession of they going to pay you with,” the naysayers sneered, seemingly insurmountable hurdles to see “a goat?” Ssatellite television launched in Asia. Johnson who spoke on the side lines of Casbaa His proposition was at once simple and Convention 2011 was definitely thinking outside unfathomably complex. The idea was to park a the box, so far outside it some people thought he satellite over Asia and deliver multiple television was on another planet. “That was the logic you channels to half the world’s population virtually faced a lot,” he remembers. “My argument was overnight. The wider implications of such a project simply that ‘market was equal to reach’. And if we would only gradually be discovered, but sat TV were able to put a satellite that used relatively small would immediately introduce a very middle-class dishes across 60% of the world’ population then, idea: choice. Potentially hundreds of millions by definition, there had to be a business there.” would be free to watch something other than their The challenges were endless: to succeed, dreary national channel. Johnson needed access to American and Asian Though simple on paper, Johnson’s plan counted corporate elites, hard enough for someone with on forging the most unlikely alliances, and betting industry credentials let alone a man with limited on successful completion of a never before tried film and TV production successes in his CV. He also mission in space. needed friends in high places to navigate the craggy It also flew in the face of conventional wisdom, shoals of Sino-U.S. diplomacy – before and through

especially one absolute of international investment: the 1989 Tiananmen crisis. The prospect of collapse Harry Harrison Illustration:

22 CASBAA Q4 2011 was always just beyond the next turn, and it nearly came in June 1989. The scattered pieces were Everything hinged on recovering Western Union’s uncommunicative communications satellite Westar 6 starting to fit together. Satellite from space, a feat never done till NASA’s Space Shuttle Discovery retrieved it along with Westar 6 was on its way another satellite in late 1984. (Otherwise in good nick, Westar 6’s thrusters had failed preventing it to becoming AsiaSat 1 from achieving its correct orbit.) Stretching credit card access to the limit, Johnson and a couple of Westar 6 was on its way to becoming AsiaSat 1, friends managed to put enough down with the but not without a lot of high level to-ing and insurance underwriters, its latest owners, to secure fro-ing. “Two successive secretaries of defense first option to buy it. Full purchase price: US$20m, visited China during the evaluation phase prior a bargain compared to a new US$60m satellite. to the launch of AsiaSat 1,” Johnson recalls. The Department of Commerce and the White House support from pan am also played a hand in sizing up China’s potential Johnson next struck a deal with the owners of for sending up the US satellite. “The process took Pan Am, the once mighty but failing airline soon so long it crossed into the George H.W. Bush to make its final approach to bankruptcy. “Pan presidency in 1989,” Johnson says, remembering Am Pacific Satellite Corporation was a venture Bush 1 as a keen supporter from his days as CIA I started in 1986 with Pan American World director and as US Ambassador to China. Services, a wholly-owned subsidiary of the Pan Am That explained Bush, but why did his famously Corporation.” Johnson was CEO. anticommunist predecessor back the project, when Teaming up with Pan Am wasn’t as odd as it its success could only burnish China’s image? “To sounds. Pan Am World Services then had 9,000 further destabilize the Soviets, I guess. It was a aerospace employees and operated America‘s Cape pretty wild game.” Canaveral launch facilities as the civilian contractor. The story was also playing out in Hong Kong, “The President of Pan Am World Services was John of course. Not one to shy away from the top-shelf, Casey, the brother of the Secretary of Treasury,” Johnson set his sights on introducing his project to he explains. “Pan Am World Services assisted me a proper multibillionaire. Li Ka-shing was patriarch in lobbying the of the massive Hutchison Whampoa conglomerate Reagan White with interests in ports, property and much else House and besides, including telecoms. the Defense “George Magnus was the initial champion. Department over Everybody else thought I was nuts,” he says. “I 1987-88.” mean George thought I was nuts as well, but The scattered there was something that intrigued him about it. pieces were Magnus was then executive director of Hutchison starting to fit Whampoa, providing at least temporary assurance together. Pan Am he wouldn’t be thrown out of Hutchison House, World Services then the group’s headquarters. had other talent to throw into turning another corner the project, Things developed. Persuaded that China was including William getting serious, Hutchison finally came on board. Huseonica, a A consortium was formed comprised of Pan Am project manager Pacific Satellite Corp, Hutchison Telecom, CITIC, at the NASA and British Telecom (later replaced by Cable space center who & Wireless). Cedarwood Consortium would helped evaluate eventually become AsiaSat. the mission Only one problem: no one was interested in readiness of the television. The consortium saw the venture as Long March launcher. “In 1988 Dr Huseonica and purely a telecom play. “So I just stopped inserting I brought the head of China’s launch program to television into the conversation because they the US to visit NASA.” China was starting to take wouldn’t listen to that anyway.” Johnson’s idea seriously. They sweetened things But time would heal. “After the launch, I was with a side trip to Disney World. involved in the marketing and the television

CASBAA Q4 2011 23

Rapid traction also answered another worrying One story described Johnson as question. Could a thin English-language demographic across Asia sustain the venture taking a busted American satellite long enough for local programming to get off the ground? It turned out to be a richer vein than and putting it on a Chinese imagined, fattened with a good proportion of elites who claimed English as a second language. Though firecracker to serve the poorest everyone assumed local-language content would drive regional satellite TV in the long term, English pockets of the world provided its immediate lift-off clear across Asia. “English primed the pump, but the real growth was concept was picked up totally by Richard Li,” never going to be in English.” Johnson says. “Without KS there would have never Johnson remembers the story of the launch been a satellite. Without Richard, there would have being told in different ways, one characterizing never been satellite television, certainly not in those the project as “taking a busted American satellite days.” and putting it on a Chinese firecracker to serve Marketing turned out to be the right place to the poorest pockets of the world”. People were be. Pre-launch telecom sales had been light. “We skeptical and they’d have been only more skeptical put together a plan to use the transponders for a if they knew how the story began. television product [under] Hutchvision because In 1985, Johnson says he wrote a blind letter to nobody knew if the launch would be successful, the Chinese embassy in Washington, proposing that which was a very scary notion. After the launch a Long March take Westar 6 back into space and much more energy went into building a branded give China’s nascent commercial launch program television product.” And STAR, or Satellite Television a nice boost in the process. “At the end I added, ‘If Asia Region, came into being, opening with a slim China doesn’t do it, Japan will’.” package that included BBC World Service Television You’d expect a letter ending with cheek like and MTV Asia, which both turned out to be huge that would end up in the bin. But the message market drivers, and a sports channel put together apparently traveled from Washington to Beijing, with IMG, a Mandarin- eventually landing on the desk language channel and of Jiang Zemin, China’s future STAR-Plus with a schedule president, but then its top man in packed with soaps. science and technology. STAR’s footprint stretched It was a remarkable start to a from Saudi Arabia to the remarkable journey that by the Sakhalin Peninsula. “There spring of 1990 would lead to China’s were even Russian cable Xichang Satellite Launch Center at operators starting up,” the bottom of a basin in Johnson says. Although no Sichuan province. “All one was sure what form of the villagers were business would take, or clustered around the how fast it would grow, he remembers launch site,” Johnson the experts initially predicting a DTH remembers. “We were market that would scale up to 3m about a kilometer away dishes in its first year. with all the invited guests on this deck on the roof good old c-band of a building. “I think there were 11m in that time,” “As the countdown Johnson says, crediting C-band with “unlocking started, Hutchison Whampoa Group Managing Asia’s entrepreneurial energy.” Though ideal Director Simon Murray leaned over and whispered, because of its resilience in Asia’s often stormy ‘Michael, you realize that if this launch fails, that weather, C-band was considered backward stuff rocket is going to hit this deck and there can be no by developed market standards. Still, the skeptics survivors’.” would have been wiser to hold their guffaws. The countdown came and went. The ornery Long Compared to the slow penetration of new BSB kit March 3 refused to get off its haunches and go. (See in Britain, C-band equipment was dirt cheap and YouTube: 1990 AsiaSat 1 Relaunch.) But 40 nail- ubiquitous, enabling “unprecedented pick-up” that biting seconds later it fired off into perfect trajectory, set records still unmet to this day, Johnson says. and Michael Johnson cleared one more hurdle.

CASBAA Q4 2011 25

REGULATORY BRIEF Over the top? To compete with unregulated over the top television, CASBAA argues for lighter, even-handed pay-TV regulation

choing OTT concerns according to CASBAA Deputy CEO voiced at CASBAA John Medeiros. Convention 2011, industry “But it’s coming,” he says. watchers have recently “Hulu is launching in Japan. warnedE that video alternatives are ESPNplayer.com is already here, undermining pay-TV operations, and so are CNNGo and BBC.com slowing subscriber growth in several and many other services. Sony is markets as free-to-air digital TV and putting together a multichannel web-based options lure consumers OTT platform according to press away. reports.” And Google TV and Apple TV, already If only pay TV operators were allowed to match lifting off in the United States, could conceivably OTT offerings, argues CASBAA’s latest Regulating for come to Asia at some point, he says. Growth report. As the report points out, unregulated Medeiros also notes that Asia-based OTT OTT providers are free of content, language and services have started to appear, Anyplex and TVB. other restrictions imposed on pay TV operators (see com in Hong Kong being two examples. Anyplex, box). Ironically, Asia’s pay-TV operators have yet distributed in Hong Kong through Hutchison’s 3 to feel the impact of OTT for the very reasons that mobile network and Olevia TVs and other smart made building a business so challenging in the first appliances, offers long-form content from Warner place – chiefly market fragmentation and piracy, Bros, Disney and other big brands. Then there is

Pay-TV constraints OTT doesn’t face

Excerpts from ”Regulating for Growth 2011” Taxation policy: Pay-TV operators and channels all pay substantial levels of taxation Content regulation: Internet content is (in some cases such as Indian DTH, hugely largely unregulated; pay-TV content is. Is disproportionate levels) to governments. OTT it acceptable for an OTT operator (perhaps operators can be located offshore, with no (or based offshore) to deliver content that would much lower) taxation. If an OTT operator can not be allowed on the pay-TV system, for deliver the same long-form movie content to whatever reason, to the same household on the same consumer on the same screen as a the same screen? Would it not make better local pay-TV operator, would it not make sense sense to relax some of the less important to reduce the taxation disparity by reducing constraints on pay-TV – things like watershed taxation of pay-TV network operators? hours, pre-censorship requirements, etc.? Advertising regulation (1): Some governments Language policy: Some governments require restrict the number of minutes of advertising on pay-TV operators to deliver only content that pay-TV; others restrict the ratio of ad revenue is in an approved local language, or subtitled. to subscription revenue that an operator is OTT operators are already delivering language- allowed to earn. On the other hand, an OTT specialized content without any constraints. operator offering identical content faces no such If people can choose to watch programming restrictions. in a “regulated” foreign language marketed by an OTT operator, why should not the Advertising regulation (2): A growing number of pay-TV operator be free to offer the same governments are trying to restrict the capability programming? of pay-TV to compete for ad dollars with other

CASBAA Q4 2011 27

India’s Zee TV which in October announced plans to be willing to pay for it and if that content is to launch 100 OTT channels targeting Indians easily available by downloading it off P2P servers in worldwide – through a service branded Ditto TV. China or other places, why would they pay?” And because Asia’s legal environment is so fragmented asia fragmented, and IP enforcement in some markets is Even if the same content is available via P2P so weak, piracy is difficult to fight in the courts. “In downloads, Medeiros says OTT entrants are betting the US and Europe, legitimate OTT business models superior picture and sound quality will win over are not as weakened by piracy.” consumers no longer willing to settle for foggy CASBAA argues that Asia should strengthen viewing on computer screens. Time will tell. IP protection online, and should also use the “Digital markets in Asia are not yet of the size opportunity created by OTT’s lag here to move to and importance that they are in the U.S. and lighter regulation so that pay TV has an even chance Europe, or even Japan. Asian markets outside of competing. “We argue that governments currently of Japan are too fragmented – except China, put all the burdens on pay TV and none on OTT,” which is closed to foreign players. India is a huge Medeiros says. If inequities are left to continue, television market but it doesn’t have a large digital business models could change, conceivably infrastructure. The broadband network is not yet squeezing tax revenue streams. “Indeed, the logical built out,” Medeiros says. thing for pay-TV players to do now is to look for “But OTT will get here someday. How fast it ways to provide their content by OTT and avoid the comes will differ from one country to another.” taxes, avoid content restrictions, avoid ad limits, Market fragmentation also exacerbates the piracy avoid quotas and avoid this and that.” problem. “People ask: why isn’t more content in Medeiros recalls how Canadian pay-TV Asia moving quickly into OTT distribution, as in companies demanded that US-based OTT provider North America?” says Medeiros. “ In Asia piracy Netflix be treated as a regulated service in Canada saps the OTT business model – just as it does the and pay the same levies they had to pay. The traditional pay-TV business. People are reluctant to government didn’t accede to their demands but the invest and try new online business models where dispute underscored a big difference in CASBAA’s the digital environment is so ruthlessly pirated.” approach to the OTT issue. “We consciously avoid Controlled access systems help but only to a that beggar-thy-neighbor approach,” Medeiros says. degree, Medeiros says. “If you’re delivering quality “We would much prefer to see a win-win content over an OTT service your customers have outcome, which is lighter regulation basically.”

local interests. In some cases this takes the form content producers directly, if that is desired, and of rules requiring ads to be made locally; in remove the constraints on pay-TV’s ability to others “foreign” pay-TV channels are prohibited compete with OTT systems? from taking local ad revenue. But if the same channel is delivered via an OTT system, there is Sports Rights: A few countries have “anti- no constraint, producing an evident competitive siphoning” rules designed to keep sports content unfairness. Would it not be logical to reduce on free TV. But the rules don’t cover OTT systems. the barriers confronting the pay-TV network in What is to prevent an OTT operator from buying seeking ad dollars? sports content on an exclusive basis?

Local Content: In a few countries there are Intellectual Property: Pay-TV (and licensed local content quotas that must be met by pay- FTA) broadcasters are required to obtain full TV operators. An OTT operator has no similar clearance of all rights relevant to the content requirement. Where the OTT operator can they distribute for each market. They also operate more cheaply, on the basis of purely meet obligations to local and international imported content, this puts him in a situation of rights collection societies. Will OTT operators competitive advantage over the pay-TV operator. (especially if located offshore) meet all the same Would it not make sense to subsidize local obligations?

CASBAA Q4 2011 29

TV UPFRONTs Reaching all the layers Going digital means changing the advertising business model, not just tinkering with the old one. Jo Bowman reports

ay-TV networks could be missing integration of the brand and its significance into the opportunities to deepen relationships program, such as in series one, when contestants on with advertisers – and add new revenue the show had to take part in a go-kart race around streams – by failing to develop new, digital a Caltex-branded racetrack. Caltex also sponsors Poptions for presenting a richer range of content to “Hidden Cities“ on History Channel. “Our story is consumers. very much being around branded content,” Fisher Or at least that’s the view of Brian Fisher, says. Chevron International’s Caltex Global Brand Caltex recently re-launched its own brand, Manager, one of the keynote speakers at CASBAA’s with a new tagline “Enjoy the Journey”, with a recent “TV Upfronts” event in Singapore where he broader perspective on what the brand stands for. spoke on making regional television more relevant “So, even though we still talk about fuel, we’re to regional brands in trying to reposition Asia. ourselves as being a The showcase was an partner for people that opportunity for pay-TV travel, people that go networks to get “in front” on a journey, and not of key regional media just the journey on the buyers and agency road but the journey of heads, giving them an life,” says Fisher. “We early look at their new tip our hat to the glory programming highlights days of travel, when for the first half of 2012. people actually enjoyed doing it, whereas now CHALLENGE must BE it’s become a bit of a FACED chore, with traffic jams Fisher was speaking and all kinds of hassles about the challenge he like that.” believes regional TV Television networks networks need to face should be redefining up to over their digital their role in the chain of strategy beyond linear channel web sites,” he said delivery from creation to consumer, Fisher says, on the sidelines of the event. “As we move more and exploring new ways of engaging with their and more into high-speed fiber-optic internet, increasingly demanding audiences. As well as turning speeds of five million bits per second into providing new means of distribution via digital 100 million bits per second, the digital world technology allows networks to engage more changes the whole of the TV world.” deeply with viewers, in a way that simply serving Caltex has had a long and successful relationship up a program doesn’t begin to fully unearth. In with regional pay-TV channels, which goes back the future it’s quite possible that the people that as far as 2000, when the brand was a partner on produce shows in America will just download that the sponsored Discovery Channel biography series kind of thing straight away to the home. “Crossing“, which premiered with a feature on If content producers own more of the distribution Chinese actress and director Joan Chen. channel, Fisher says, they’ll have greater control Later on, the company was a partner on the over the relationship they have with the consumer. ESPN Star Sports branded content programme That means they’ll need more engaging and unique “Score Tonight”, and in more recent years has been content, ready for delivery as and when viewers a major sponsor of AXN’s Amazing Race Asia, a want it. “I read the other day that 60% of people in relationship that has involved not just association Asia when they’re watching TV are also on another with the series on screen and off air, but real device – their smartphone or laptop or tablet,” he

CASBAA Q4 2011 31 32 CASBAA Q4 2011 There’s going to be room for cable operators to provide much more than the show offering a whole raft of information programming which makes the experience much more enjoyable

says. “If you’re watching a movie channel and you you a really good discount price. see a particular actor come on, you’re going to “What we’re still doing as buyers is buying inputs be researching that actor on your mobile device, rather than outputs. You can see in so many other so you get a much richer experience. You know, fields that people are now saying ‘I don’t want to when you see a character and you think ‘I know buy widgets, I want to buy the results’, so if you him’, and you’re wondering what else he’s been give me a great ROI, I’ll pay you accordingly.” in, you can do that now. There’s going to be room for these cable operators much more than just doing the show, but also to provide a whole raft of information programming content around that show average daily viewing time – asia (per individual – in h:mm) which will make that viewing experience even Average averages based on the size of the total individuals universes. more enjoyable.”

3:24 3:10

BUILDING DEEPER LINKS 2:49 2:53 2:37 2:39 2:39 2:41 2:31 2:36 2:33 2:35 2:34 2:38 2:34 As well as building extra layers of content around 2:12 a programme, it’s an opportunity to enable viewers to build deeper associations with the brands that support and are part of the programming they love. “If you’re watching an ad or a piece of branded content and would like to know more, 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Number of territories: you might be able to click through or go through 1 2 10 11 13 15 17 17 15 14 15 16 17 18 19 18 to some other situation where you get a lot more Territories as of 2010: information about that brand.” Growing: Australia (5 Metro Cities), Australia (Regional), Kazakhstan, New Zealand, Thailand. In Asia, this is an especially topic not Declining: China National, Hong Kong, India, Indonesia, Japan (kansai region), Japan (Kanto region), (Japan Nagoya region), Korea South, Malaysia, Pakistan, Philippines, Taiwan, Vietnam. because the industry is trailing the rest of the Source: Nielsen world, but because high-speed internet is so pervasive in parts of this region, and there’s an opportunity to lead. “I think we’re seeing the high- average daily viewing time – asia (per individual – in h:mm) speed fiber-optic stuff happening quicker in Asia,” • 2010 • 2009 • Multichannel

Fisher says. Japan Kanto 4:31 Korea South 3:05 4:54 4:32 3:12 Cable In South Korea, for instance, more than half of Japan Kansai 4:24 Indonesia 3:03 households are already wired up. “This is going 4:25 3:05 Japan Nagoya 4:21 Vietnam 2:58 2:57 to be much more of an issue than trying to worry 4:24 3:10 Cab/Sat about 3D TV content,” says Fisher. “We’re going to 3:35 3:23 2:50 1:51 Philippines Kazakhstan 2:24 Cab/Sat see a lot more continued blurring of content and 3:44 Cable New Zealand 3:22 3:34 Taiwan 2:47 2:54 advertising. Regional TV networks will have to own 3:17 Pay TV 2:49 Cable more unique content.” Australia Reg. 3:16 3:16 China 2:31 2:59 Pay TV 2:38 Fisher says any problem for broadcaster is not Malaysia 3:11 1:08 Thailand 2:18 just intransigence. “They’re flexible but the model 3:18 Astro 2:16 Hong Kong 3:08 3:11 Pakistan 2:07 1:52 from where you trade on cost per spot is changing. 3:13 Multichannel 2:10 Cable

Now, just as marketers are judged on performance, 3:08 1:58 2:13 Australia 5 cities India 2:18 clients would expect to pay much more in terms of 3:03 Cab/Sat performance rather than here’s a spot and we’ll give Source: Nielsen

CASBAA Q4 2011 33 COUNTRY REPORTS

S O U T H K O R E A Shifting giant Latest CASBAA ‘Korea In View’ report focuses on a market set for big changes

outh Korea is well known as one of the Pay-TV ARPU, by country world’s seriously advanced digital markets. (USD) It leads in everything from tablets to 80 smart TVs, mobile and fixed broadband. 70 60 It is also a relative giant when it comes to pay TV. S 50 Penetration runs at over 100%, so high in fact that 40 many households have connections to more than 30 one pay-TV provider. 20 So it’s surprising to learn just how much the market 10 underachieves when it comes to yardsticks like average 0 India Japan Korea China Taiwan Pakistan Australia Thailand Sri Lanka Vietnam Singapore Indonesia ARPU earnings (US$11 monthly) or media and Hong Kong Philippines New Zealand entertainment spend, which is a fifth Japan’s. In short, Source: KCC Korea is still far from even punching its own weight. This could all be about to change. Following One country, many modes of distribution

robust efforts to introduce competition to the pay- Connections Total Household IPTV Digital Cable Skylife Cable (Analogue) TV distribution market, authorities have turned their 25,000,000 attention to promoting investment and competition Cable (Total) Total Pay TV Subs. 20,000,000 across the broadcasting industry with a series of far-reaching initiatives. And analysts are now 15,000,000

confidently predicting a new wave of growth. 10,000,000 In this respect, the upcoming edition of CASBAA’s 5,000,000 latest Korea in View report (to be released early next year) provides a timely update on these regulatory 0 changes, the most important of which include the 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 introduction of new general programming channels, Source: KCTA, company reports the opening up of the advertising agency market in broadcasting, and the removal of various barriers to approached US$3 billion in 2010, up from domestic and foreign investment in TV. just over $2 billion in 2007. While intense One thing’s for sure in all this change: competition for pay-TV subs is likely to keep competition in broadcasting and pay TV is going to pressure on subscription fees, there is optimism continue to be brutal. that broadcasting is set to win a greater share of For some the answer to these changes has been advertising spend as deregulation kicks in. to take to the courts and the report looks at a series Audiences may be bigger but they are also more of outstanding legal tussles. For others it has meant fragmented. Koreans now watch on demand, HD getting bigger with new alliances and mergers; just and even 3D content on more devices than ever about everyone who wants to stay in the game is before. Convergence is also bringing new forms of going digital. competition as all operators, including terrestrial broadcasters, provide offerings that deliver content COVERS THE FIELD across multiple screens. The report also examines the progress of IPTV The report also examines some recent examples launches, cable’s move towards digitisation, as well of foreign broadcasters accessing the market in a as the disruptive tie-up between telecom heavyweight meaningful way and the likelihood of further progress. KT and Korea’s sole DTH broadcaster Skylife to offer Among other areas Korea in View covers is a hybrid Satellite and IPTV service. It also looks at the copyright protection, where Korea has made new merger of CJ and On media and their effort to create a strides – thanks to updated legislation and more powerful new media group. active enforcement. In 2010, the market saw a Korea in View digs into trends such as where 41.9% year-on-year drop in the value of total illegal revenues are being generated and how audience content, to 510bn Korean won. viewing habits are changing. Industry sales Craig Steven

34 CASBAA Q4 2011 I N D O N E S I A More on the menu

CASBAA “Indonesia In View” report explores impact of new entrants

consumers to pay-TV in a way that hastened their migration to Indovision’s premium service. Last June, Telkomvision, the DTH unit of fixed- line telco giant Telkom broadened its pay-TV offering with “Groovia TV”, the first IPTV service in Indonesia. Launched in Jakarta, the roll-out should take in Surabaya by yearend, offering a service that can be accessed through smartphones, tablets and computers as well as TVs. Pay-TV operator First Media, serving primarily Jakarta with a triple-play service, has also announced it would be expanding its footprint, thanks to an infusion of private equity cash. It plans to add an additional 1.2m home passes in the next four years, a project said to cost US$250m. hey say good things come to those who Relaunching in December 2010 and pitching wait. Those waiting for a lift-off in the prices low, DTH platform Aora-TV picked up Indonesian pay-TV market will be hoping 100,000-plus subscribers in just nine months. a flurry of new launches further ignites a Another new DTH entrant, Skynindo, promises a Tmarket that has been frustratingly long on potential comprehensive variety of Mandarin and in-house and short on performance for most of the last decade. channels subtitled in Bahasa Indonesia. Skynindo Indonesia may have up to 50m TV households, which like Indovision, First Media and Aora is a but with legitimate pay-TV subscribers accounting member of CASBAA, covers the archipelago in HD- for only 3% of them, it is still ranked near the quality using MPEG 4 technology over C-band. bottom of any regional table. Now, however, various Other new launches include Centrin TV and analysts are becoming more optimistic. Pyramid Orange TV, both offering DTH broadcast services, Research says pay-TV penetration is expected to and NexMedia, the first pay TV operator to offer reach 7% by 2015. Alongside growth in platforms DTT services covering Greater Jakarta. and subscribers, the stage looks set for an upswing in CASBAA’s Indonesia in View will also update demand for content and potentially prices. readers on the country’s licensing So CASBAA’s Indonesia in View report scheduled regime, which requires new operators to meet specific for release early next year should make timely milestones to stay in the game. The report also looks reading. It promises a comprehensive update on at recent changes to legislation regarding ownership the expanding line-up of pay TV operators, their and investment in content – and local content strategies, platforms and competitive position in an requirements likely to impact foreign participants. evolving and complex regulatory landscape. The report will review recent initiatives to tackle New launches span direct-to-home (DTH) piracy and recent achievements in combating satellite, IPTV and hybrid services, which at last the problem; implications of Indonesia’s new count numbered five with more planned over the Broadcasting Law scheduled to come into force next 12 months. in 2012; and the political context of evolving broadcasting regulation. DOMINANT INDOVISION “Indonesia’s government has adopted a favorable The report also looks at incumbent Indovision’s policy towards building a competitive and diverse response to the arrival of new entrants. In 2008, media scene,” CASBAA CEO Simon Twiston Davies Indonesia’s dominant player launched a standalone says. “It is to be hoped that the openness and satellite DTH platform called “Top TV” in hopes market-orientation that has characterized policy of expanding the market with keener pricing and since the last revision of the Broadcasting Law will more localized content. The plan was to introduce continue.” CS

CASBAA Q4 2011 35

GEO TV Look who’s talking As TV devices changed, so the conversation changed. Jo Bowman reports

his year’s CASBAA Convention – 20 grounding of an airline. You can watch it on TV, years after the organization was founded mobile, iPad, and more and more innovation is – began by putting into perspective just coming,” he said. how much television and the business At the same time as there’s been gradual thatT provides it has changed in that time. From evolution, game-changing technologies have scheduled viewing on one or two channels until come along to quicken and guide the pace of the test pattern kicked in at midnight, we now have change. Catch-up viewing online, for which the the world and its endless options in the palm of our gold standard is the highly successful BBC iPlayer, hand. have not only made viewing more convenient but As News Australia news presenter David helped foster new, deeper relationships between Speers recalled, most people’s first experience of consumers and the content they love. live 24-hour news coverage in this region was those The key is to package and present it in a way that’s green-and-black night-vision shots of the first Gulf easy to navigate, and that inspires viewers to pursue War – watched by many Asia-Pacific viewers not their passions through content, however niche. on a 24-hour news channel but rebroadcast on a Jana Bennett, President, Worldwide Networks terrestrial channel. The internet was pretty much & Global iPlayer, BBC Worldwide, said there was unheard of. “Fast forward to today, and you can no less hunger, however, for a shared viewing watch anything, whether it’s Colonel Gaddafi being experience of live, linear television. The challenge

pulled out of a pipe in Libya ... or the unexpected for broadcasters, she said, was to use all the Harry Harrison Illustration:

38 CASBAA Q4 2011 tools in their arsenal to build up excitement and anticipation for new series and appointment viewing. “We need to create a sense of event and mass experience. Users make lots of choices as individuals, but they want to share.” The boom in broadband penetration and mobile phone adoption has fuelled the development of what Blair Westlake, Corporate VP, Media & Entertainment Group, Microsoft, called “smart glass”, and new ways of thinking about what “watching” and “TV” really meant. “I’m fascinated beyond words with the evolution of the smart, connected TV,” Westlake said. “I would bet that in the next three years, we’ll see every bit as much

Conversationalists: Sky News Australia‘s David Speers, BBC Worldwide‘s Jana change as we’ve seen in the past three.” Bennett and Microsoft‘s Blair Westlake Andy Lack, CEO of Bloomberg Media Group,

NBCU takes a harder look

Following the merger of NBCUniversal with US business is not represented on the subcontinent, cable distribution giant Comcast, many people and by the sound of things, the market presented at the Convention 2011 wondered what it all a real challenge for the company. “While every meant for Asia – and NBCUniversal International market is like some kind of algebra, India is like President Jeff Shell offered some broad hints in calculus.” his ‘In Conversation’ segment. More generally, Shell seemed to welcome For starters, he said his company was now digital’s advance, seeing it as a growth driver. geared up to devote more attention to Asia. “We are a multi-platform company that has “Internationally, we are undersized, with 92% successfully taken on the telcos,” he began. of revenues coming from the “Digital is all positive to our US,” he conceded. He said business. The money is in the the NBCU merger brought traditional TV business – and a special advantage in the ‘everywhere’ just bolsters that growth department. “One model.” difference is Comcast is not Shell added: “Digital in the guided by meeting quarterly early days was a dangerous earnings numbers and is able path but now we are in a to take a long-term focus.” much more stable place. We Shell then ran through the are now seeing subscription list of key markets on NBCU’s NBCUniversal‘s Jeff Shell models taking hold with both radar and was clearly excited about South Netflix and iTunes.” Korea: “Korea is a great market for us, with high The digital question led naturally to the penetration and high digital,” he said. subject of connected television. “Clearly the era China, on the other hand, was still a work in of connected TV is coming where the set-top progress. “We have a great theatrical business box will be IP-based and built into the terminal.” in China,” he said. But it was still early days for That implies, he said, that the functionality of developing other parts of the business in China. the set-top box will move into the cloud, making “We need the right partner and strategy.” And by “content everywhere” much easier. that Shell meant a partner with more than cash But Shell seemed less sure business models to throw into the pot. “It’s not about capital, you were in for the same radical change. “You still must have influence.” have to subscribe to something [so] we will still India still seemed to be a question have a subscription model.” The biggest change mark. Although CNBC distributes there, will probably be in electronic program guides. NBCUniversal’s flagship entertainment content “The EPG will become more important.” CS

CASBAA Q4 2011 39 40 CASBAA Q4 2011 said new technology was making it far easier for of the end user. Computers have finally become broadcasters to get their content to consumers. TVs and, with over the top or OTT technology, the The company’s just launched BTV, a service opposite is also true. A phone can be a TV in its designed for tablet computers. “It opens the door own right, or a remote control for a bigger screen. to understanding what video means in a digital For the viewer, what matters is not whether they’re world,” Lack said. “The tablet screen is going to watching via satellite, cable or the internet, but the blow a hole through those other screens.” quality of the content available to them, and the experience they’re having when they find, view and Converging technology is translating recommend it. That means companies that not so into new alliances long ago thought of themselves as rivals working together for mutual benefit. onvergence and cooperation were Ivan Verbesselt, CMO of Kudelski Group, kicked the big themes to emerge from the off the Return Engagement session by telling the Convention, in this nascent era of industry that near-ubiquitous broadband in Asia always-on consumers and always- meant that a digital lifestyle was already being connectedC technology. As the old view of TV and lived by many of the region’s consumers; meeting the internet as rivals melts away, media brands, their expectations that whatever they want to service providers and tech companies are coming watch will be available whenever and wherever to see the viewing experience from the perspective they want it is essential, he said. But in a world

SK Telecom: Taking the long view

One market that has proved yuan (US$2 billion) investment harder to crack than most for altogether. international media groups is “We plan to combine the biggest one of all – China. creative industries with real Now some companies are estate so we will have a media trying a fresh approach, starting cluster by inviting Korean from the ground up. partners and others to join.” Korea’s SK Telecom is The aim is to build a embarking on an ambitious sustainable business model project to build a state-of-the- within a creative and interactive art media city in Chengdu, the environment, including studio capital of Sichuan province. and research and development. The project which began two The telecom and media group years ago and will take two to also plans a content fund, three more to complete, reflects though specifically how this a long-term commitment to aspect of the project develops is SK Telecom‘s Jay D.Sung China, explained Jay D. Sung still under wraps. Sung wouldn’t CEO and President of SK (China) Cultural and say whether SK will enter the content financing Creative Industries Development Company. business as such but added, “SK will be a The project effectively turns Korea’s telecom facilitator and motivator to stimulate creativity and media giant into something of a property by providing the right environment.” developer, but for Sung it goes with the territory The project certainly sits well with China’s if SK is to make any headway in China. “China 12th Five-Year Plan which, among other things, is a land of opportunity but also contains various prioritizes cultural development as another avenue complexities,” he says. “For SK, China is a ‘must’ for expanding the country’s domestic economy. market, not an optional market.” But Sung offers no predictions on how fast Importantly, the project draws Chengdu the heavily regulated media sector may open up and SK into a long-term commitment, but to provide further opportunities. “China policy- also enables flexibility where new media making is likely to be incremental and not a is concerned, Sung says. Its MOU with the nuclear reaction.” Chengdu city government involves a 12.8 billion Craig Stephen

CASBAA Q4 2011 41 42 CASBAA Q4 2011 of such vast choice, what they culture,” he said. By 2015, he predicted half of really would value was a simplified TVs would be web-connected. “The key to success experience. is going to be seeing multiple screens as part of a Olivier Barberot, Chairman single experience.” & CEO, Globecast Worldwide, concurred that consistency of NEW ENTRANTS experience across devices was what New players in the business of video provision said consumers were searching for. “No there was little evidence of traditional television matter how many types of screens suffering as a result of what was going on. Over are involved... TV as an experience, the top and video on demand services were part of an emotional exchange between an unstoppable revolution, said Johannes Larcher, Globecast Worldwide‘s Olivier audiences and content, remains SVP of International of Hulu. Meeting a demand Barberot a dominant force in shaping our was paying off, not just for Hulu, but for content

Microsoft’s Blair Westlake: Get smart

The pay-TV industry will need to get smarter if smart full pay-TV package. TVs deliver on their promise and shake up viewing Time Warner Cable, habits and business models. That means embracing the for example, offers idea of choice and flexibility that come with internet a smaller number of connected TVs, or risk falling behind. channels that can be Internet, or over the top (OTT), television is fast accessed on smart matching the capability of pay-TV and ignoring TVs. developments would be a mistake, says Blair Westlake, Westlake argues Corporate VP, Media & Entertainment Group, that smart TVs Microsoft. “Don’t wait until it’s too late, even if the don’t have to be alternative is not [yet] as good.” cannibalistic from a One indicator of changing viewing habits comes pay TV standpoint, via Microsoft’s gaming console, Westlake says. but he adds a caveat: “Three and a half years ago it was used 100% for “It is potentially games, but now 40% of consumers use it for non- a concern for gaming entertainment.” incumbents if they The pay-TV industry in the US is already on board, are the only way to according to Westlake who points to recent agreements access content.” Microsoft‘s Blair Westlake by US cable heavyweights Comcast and Time Warner After all, a natural to put their content on Samsung smart TVs and tablets. logic inevitably He characterized the deals as an important “tipping comes into play. “As a general rule of thumb, markets point”. will hit a ceiling in terms of what customers will Industry analysts also forecast huge growth in tolerate,” he says. “When choice is introduced, that connected TV penetration. While connected TV’s were spells trouble [for incumbents].” only in 6% of households at the end of 2010, they are Westlake’s advice: “Do not wait for viewers to get projected to rise to 20%, or 551 million units, by 2016, out of the habit of doing something once they have an according to a report by Digital TV Research. alternative.” “We are moving towards a world without the set-top He points to Netflix in the US and says forget all box,” says Westlake. “These new TVs mean a simple the “noise” over its recent price increases and the app can take over the functions of a set-top and allow company’s (since reversed) plans to split and rebrand its your TV to be controlled through it.” streaming and DVD distribution services. Pay attention That’s compelling. “It is an economic issue as much to the changes taking place. “What we have seen is it as anything, as companies seek to save on the costs of moving to a subscription model – we have gone from periodically changing out set top boxes,” he says. hypothetical to real subscribers paying money.” One benefit of connected TV offerings is they can In short, the gap between pay TV and OTT business expand the market past those who do not want the models is narrowing. CS

CASBAA Q4 2011 43 Clockwise from top: Registration center served as Information Central; Getty Images booth conveyed industry data in spectacular fashion; Shari Swan at the podium; The China panel is in a lighter moment; Hong Kong Financial Secretary John Tsang Chun Wah opens CASBAA Convention 2011; Regulators’ Roundtable gets down to business owners, who have come to value new distribution it and helping make it available to people.” methods as additional streams of revenue rather The importance of collaboration in catering to than threats to the old way of doing things. the new consumer was clear; Hulu works with Michelle Guthrie, AP Director, Strategic Business 300 content providers, gaming platforms, mobile Development at Google,which owns YouTube, phone carriers, and distribution partners. The said online, ad-supported viewing was helping way viewers discover new content has changed, broadcasters like the UK’s Channel 4 achieve and that means working with social media, said incremental reach and ad revenue, and allowing Jayne Leung, Director, North Asia, with Facebook. consumers to discover new content that they Friends’ recommendations have an immense wouldn’t have stumbled across on the box. YouTube impact on viewing choices, she said, and social recently announced it was launching 100 new media platforms provide broadcasters with a channels. “What we really try and do is stimulate way to maintain contact with viewers even when ecosystems,” Guthrie said. We’re not creating the they’re not tuning in. “It’s all about identifying content, we’re finding partners who are developing real connections that enable content owners and

Japan: Open for business

Japan has been battered and traumatized by national opportunity for further development,” said Nobuya tragedy and economic upheaval this year, but its people Wazaki, President of WOWOW, the satellite pay TV and its government are determined that their country broadcaster. Good content would be what will make or will rise again, stronger than ever before. break pay channels, he said. “Our economy is regaining its Japanese pay-TV in vigor as a result of the warm support future will offer more than we’ve received from all corners of the TV, J:COM’s, President & globe,” said Tetsuo Yamakawa, Vice- CEO, Shuichi Mori, told the Minister for Policy Coordination with conference. Lifestyle services Japan’s Ministry of Internal Affairs & – medical services, local Communications. information, supermarket And, given its huge appetite for shopping – will all be part of technology and quality content – HD what the company plans to call TV usage is high, 100% of households J:COM Everywhere, offering can get broadband, piracy is low by whatever its customers need, world standards and 3D movies now everywhere they are. account for 60% of all movie revenue, But while Japan is an Yamakawa said – the country is still attractive and usually profitable ripe for international investment market for international and partnerships. “One thing that broadcasters, advertising enriches people’s hearts is high-quality Policy Co-ordinator Tetsuo Yamakawa revenue is still tiny given the content,” the minister said. size of the market. The digital switchover of TV signals in July this Long, strong relationships between terrestrial year would provide a significant boost to the already- channels and advertisers and their agencies have strong growth being seen in the cable and satellite TV proved hard to lure clients away from. Ward Platt, industry, he said, making subscription a simpler process President, National Geographic Channels Asia & Fox for consumers. International Channels Asia, said the onus was on the But as well as inviting content owners and pay TV industry to demonstrate its effectiveness as an distributors to engage more deeply with his country, ad vehicle. Yamakawa suggested they might draw on “cool Steve Marcopoto, President & MD, Turner Japan” and produce more content for international Broadcasting System Asia Pacific, said it was essential consumption. The local production sector is already that the sector prove its worth. “Certainly, if the recovering strongly; 80% of production houses are business is to grow and we’re going to generate already operating at or above pre-disaster levels. revenue to put back into content, we need that second “The Japanese pay-TV market has ample revenue stream,” he said. JB

CASBAA Q4 2011 45

marketeers to establish long-term connections with delivering their content is adapting too. In Europe, people,” she said. hybrid satellite and terrestrial services are being Marcel Fenez, Chairman of CASBAA and Global launched, Glen Tindall, VP Sales AP of SES, told Leader, Entertainment & Media Practice, PwC, said the Reconfiguring the Future panel session. And, the new partnerships that were being formed across Telkom Indonesia is planning TV content over the industry, in many cases between organizations mobile in mid-2012. President Director/CEO that were rivals a year ago, had set a new, more Rinaldi Firmansyah said both satellite and fiber harmonious tone in the business than even a year would be used to reach consumers across the ago – one driven far less by fear. “We’re much country’s challenging geography. What will be more prepared to engage with new players in the reassuring to everyone in the industry is that where industry; there’s definitely more willingness to quality content and an experience to match were collaborate,” he said. provided, viewers and advertisers followed – and consumers’ willingness to pay for legally obtained INFRASTRUCTURE REsTRUCTURES quality content when access to it was readily In the same way as viewers are opting not for available. Tindall said people were even willing to one screen or the other but are using all screens, pay to watch high-definition versions of content and often several at once, the infrastructure that’s they could watch for free in standard definition.

MALAYSIA: STOP LAMENTING AND COMPETE

In a market with become platform-agnostic. “Eyeballs are the name of 28 million people, the game.” proven demand for Sreedhar Subramaniam, CEO/Director, Asian high-quality content Broadcasting Network, aims to launch early next year and a multichannel with a quality, more affordable service that doesn’t penetration rate compete with Astro but serves a different part of the of just over half market. “When people do not have affordable access of all households, to information, there’s a lot of disparity in economic Malaysia’s pay growth,” he said. TV market is ripe Henry Tan, COO, ASTRO, said his company was for growth and evolving to stay at the forefront of the industry, having competition is hotting pioneered HD and 3D, it’s now looking at a la carte and up. “Nearly 50% of discretionary purchasing. Since February this year, for the population have instance, new-release movies have been available on a never had pay TV pay-per-view basis just 15 days after their cinema run; and they’re the ones there have been more than 2 million purchases already. who aren’t having Jeremy Kung, EVP, New Media & CEO, TM Net, Astro‘s Henry Tan their needs met,” said said the problem new players would have would be Kathleen Syron, Chief sourcing enough quality content – a challenge when Content Officer with YTL Communications. “There’s one strong player – Astro – already controlled much of room to serve these people ... whether there’s room it. “Malaysians deserve options,” he said. enough for all five or six of us, I don’t know.” ASTRO’s Tan hit back, saying all their content This panel session, hosted by Bruce Dover, CEO of was bought in a competitive, open market, which Australia Network, looked at how the landscape might new players were able to enter as rights agreements change as challengers take on the dominant player expired. “We compete with everybody else. We make Astro, not just in offering television but other services no apologies for winning the bids,” Tan said. Offers and on other devices. to collaborate with new players had been rebuffed in Datuk Kamal Khalid, COO of Shared Services TV the past, and pointed out that Astro had battled hard Networks, Media Prima, said free-to-air content was to gain its foothold – suffering losses in its first decade enjoying strong viewing figures, even in homes that of business; now that it was profitable, it seemed rivals subscribed to pay TV services. But where viewers go, were crying foul. “Stop lamenting and compete,” he content must also go, and the company must aim to told them. JB

CASBAA Q4 2011 47

The acronym OTT, for over-the-top TV services, is Christopher Stokes, CEO of NetResult said. Making far from being a household name. No great surprise quality content widely available in a legal way there, given that vox pop interviews done in Hong would stop a large number of people seeking out Kong and played at the Convention showed plenty illegal, inferior access to it. An online survey of of people struggled to remember what BBC and the convention audience determined that 54% of CNBC stood for. But while they might not know the respondents expected OTT to have a “very good term, they certainly use OTT services a great deal, a effect” on choice and competition. panel session on OTT showed. What the developments of the past few years – “It’s not imminent; it’s here,” said Nigel and certainly the past 20 years – have taught us, Harper, Director of ESPN Player, about OTT. In though, is that OTT won’t be the new phenomenon Singapore, he said, people were sitting on their on the block for very long. David Butorac, CEO of sofa watching F1 motor racing in HD on their TV Orbit Showtime Network, said the industry’s focus set, while simultaneously watching extra detail needed to remain on the consumer interface rather via ESPN Player on another screen. As well as an than how content was moved about. “We’re on opportunity to satisfy growing consumer demand, a continuum, growing every year and creating a OTT was also a way to help counter content piracy, richer experience for the consumer.” iPLayer: beefing up the BBC lunch, not eating it

It is no small exaggeration to say the BBC’s iPlayer It’s not trying to service has revolutionized viewing habits in Britain perform like a now generating in excess of 150m requests per channel.” month for its catch-up TV service. Numbers like these The goal in the mean the launch of the BBC’s international iPlayer is end is to ensure the guaranteed to attract plenty of interest as it seeks to international iPlayer take this success overseas. grows hand in hand According to Jana Bennett, President, Worldwide with the rollout of Networks & Global iPlayer, BBC Worldwide, the the BBC’s traditional service is more about adding to the way TV is watched channel business. than changing it. “The iPlayer gave us a foot in the “We are launching non-linear camp,” she says. “But linear TV is not dead our suite of channels – the iPlayer is not competing but providing additional in Thailand in behavior.” January, and we just To underline this point she explained that while the formally launched technology and on-demand viewing is different, the BBC Knowledge, attraction of TV stays the same. BBC Lifestyle and

“There is still the urge not to miss things. Live TV has BBC Entertainment BBC Worldwide‘s Jana Bennett gone up in the UK and the US on its own.” in Taiwan,” Bennett Increasingly there is a demand for immediate explains. “We’ve also just launched BBC Lifestyle on viewing, says Bennett. “But how do you make live NexMedia in Indonesia.” events happen?” A keynote at CASBAA Convention 2011, Bennett She cites the example of the BBC’s Top Gear series even had friendly words to offer to OTT entrants. “We where it has fans on Facebook now numbering in the respect different business models and all rights,” she millions, anticipate each show like a live event. But this said. “We are all trying to make value and profits and also brings added pressure. “We’re looking at day and reinvest.” date transmission – we must make sure it’s available.” International iPLayer’s new subscription service There are differences between the international offered via iPad is available only in Australia. There are version and its domestic UK version, which is a catch- no immediate plans to launch elsewhere in Asia, but up TV service for consumers paying a license fee. Bennett says it’s early days. It’s too early for us to say The international iPlayer uses a genre-led approach, anything about Asia at the moment but as soon as we allowing navigation “like a personal journey,” says can, we will.” In fairness, global iPlayer only launched Bennett. “We expect it to be entirely non-cannibalistic. three months ago. CS

CASBAA Q4 2011 49

CASBAA PROFILES GE Sat’s Andrew Jordan How to win friends and influence policy

An occasional series of conversations with CASBAA Members

ndrew Jordan has been a Member of CASBAA for longer than most people can remember. As his career has developed and the industry has matured,A so too has the Association. Now CASBAA’s longest-standing Member, Jordan says that what began as something of a drinking club for expat TV execs who wanted to talk shop now commands the ear of governments and regulators alike. And hosts the only don’t-miss industry events in the region. The CASBAA of 20 years ago, he recalls, “bumbled along” initially, with a fairly vague sense of purpose; what gave the organization a real structure and drive was the decision that rather than attend the couple of big Asian conferences run by external event organizers every year, the industry – through its fledgling association – should take control of its own destiny and run its own annual conferences, with themes and speakers that provided not only more variety, but more timely, relevant insights. As the Membership and the reach of the organization have grown, so too has the value of Among the most important initiatives in defining being part of it. “I do remember occasionally, in the organization’s role in the region, Jordan says, the early days, asking myself what it gave me other has been the anti-piracy push, which has educated, than the conference, but I never ask myself that named, shamed and brought to court many of now,” Jordan says. “The advocacy and regulatory the region’s worst and most costly drains on the work alone justifies the Membership, and that’s region’s television industry. The Regulating for really come on in recent years.” Growth studies, put the policies and practices of governments around the region into sharp focus. The advocacy and regulatory Now in its third iteration, the series evaluates and provides points of comparison on how video work alone justifies the content is regulated, market by market, and is scrutinized by regulators around the region, Jordan membership. There’s a great says. In a relatively short period of time, CASBAA has sense of professionalism in the built a reputation as a trustworthy and authoritative – if not always entirely welcome – voice of the organization industry, which consistently seeks to open markets and establish a level playing field. “It plays with a very straight bat and represents the interests of members whose common goal is to increase business opportunities by providing the best entertainment content,” Jordan says. Given that there was no pay-TV industry in Asia to speak of 20 years ago, local representation on the newly hatched industry body was some time

CASBAA Q4 2011 51 coming. “In the early days, satellite TV wasn’t even a panel of fellow satellite professionals at the pay TV, and TV in the region was a pretty mixed CASBAA Convention. When Jordan cast aside bag,” Jordan recalls. “It was reasonably okay in professional rivalry to help a fellow executive put places like Hong Kong and Singapore... but in together his presentation at the last minute, a new other jurisdictions there were a lot of long segments relationship was forged, and the later went on to along the lines of government ministers opening offer him a job. hydroelectric plants.” Now, of course, cable and satellite operators and Although it was primarily foreigners, from the US broadcasters are only a part of the broader business and the UK, who ran things, it soon became clear of distributing video content, and the CASBAA that success in such a diverse region as Asia could Membership – including software, telephony, not come by simply providing western content advertising and research companies – reflects that. here. Local hires were made, and now many of the Jordan says the interests of hugely varied Members most experienced hands in the industry – and in the are well balanced. “We’re all dependent on each CASBAA membership – are home-grown talent. other, and CASBAA responds to its Membership The networking element of CASBAA Membership through various committees, the AGM, the remains a key draw, on par with what the Council of Governors which is voted for by the organization achieves through lobbying and membership, and the Board of Directors, so there’s education, Jordan says. “The CASBAA Convention strong representation,” he says. “I think CASBAA is the only conference in Asia on my must-attend does a terrific job of managing expectations and list every year. You get some very bright people responding to them.” there who are a great deal of fun to be around, so Jo Bowman you can do business and enjoy yourself.” Jordan can even credit CASBAA with opening Andrew Jordan is President and CEO of GE Satellite. the door on a new career opportunity; back in He’s worked in Asia for two decades with most of 1993 when he was working for AsiaSat, he chaired the major broadcasters and satellite operators.

casbaa projects its ‘voice‘

CASBAA constantly seeks to deepen and widen Asia and worldwide. Member corporations also its ties across geographies and across the comprise leading suppliers and manufacturers of growing profusion of industries that contribute cable and satellite technology, related business to the growth of multichannel television in its service providers, communications, advertising many forms. The goal: to further strengthen our and marketing executives, media, government voice on the pivotal issues affecting our industry regulatory bodies, telecom companies, new at a time of rapid media service change. providers and network Covering 17 enablers. geographic markets CASBAA also and encompassing strives for clarity 420m connections and enforcement from China to of regulations, Australia, Japan to and regulatory Pakistan, CASBAA transparency, truly has become consistency and multichannel TV’s authoritative voice for neutrality. It pursues these goals through promoting even-handed and market-friendly lobbying, organizing conferences and regulation, and revenue growth through exchanges, research and publishing, and subscriptions and advertising. through CSR initiatives targeting projects helping CASBAA’s 130 member organizations include communities in the markets it serves. leading cable operators, satellite operators, For more information on CASBAA activities DTH and broadband operators as well as and events, and membership details, please visit multinational networks and programmers in www.casbaa.com.

CASBAA Q4 2011 53

album | social events

Research Breakfast with Synovate China Breakfast with Paul Weiss Nov 1, 2011, Hong Kong Nov 1, 2011, Hong Kong

Satellite Breakfast with GE Satellite Nov 2, 2011, Hong Kong

CASBAA Q4 2011 55

album | social events

Lunch with Youtube Lunch with FOX Nov, 2011, Hong Kong Nov 1, 2011, Hong Kong

Lunch with Irdeto Lunch with Bloomberg Nov 2, 2011, Hong Kong Nov, 2011, Hong Kong

CASBAA Operators‘ Group Nov, 2011, Hong Kong

CASBAA Q4 2011 57 album | casbaa ball CASBAA Q4 2011 59 album | parites

France24 Cocktail TV5 Party Oct 31, 2011, Hong Kong Nov 1, 2011, Hong Kong

PwC Cocktail Oct 31, 2011, Hong Kong

60 CASBAA Q4 2011 Irdeto Cocktail HBO Party Nov 1, 2011, Hong Kong Nov 1, 2011, Hong Kong

Disney Party Nov 1, 2011, Hong Kong

CASBAA Q4 2011 61

album | parites

Discovery Party Nov 2, 2011, Hong Kong

NBC Universal Party Nov 2, 2011, Hong Kong

CASBAA Q4 2011 63

BY THE NUMBERS The big picture

Multichannel industry report finds Asia extending its global lead

ASBAA’s update on trends in The report says the multichannel industry multichannel TV makes such good posted 12% YoY growth in terms of percentage of drill-down reading. CASBAA compares connected homes and dual subscription homes as the latest information from such channel choices increased. sourcesC as Nielsen, Synovate, SNL Kagan, PwC It notes that TV players are engaging with social and expresses the data in a global context. The media more while building their own online picture that results shows Asia outpacing other communities and expanding their reach via new regions in connections and in a host of categories devices and channels. But old verities prevail: As from subscriptions to advertising. (Sadly, Asia CASBAA says, “TV continues to deliver an intensity hasn’t yet surrendered its lead in non-internet of experience and audience reach that other media piracy.) struggle to match.” Continues on page 67

Asia Pacific Leads The Way Total 33Global ADVERTISING REVENUES Media: % Multichannel Homes 2008-2015 change year to date US$ 500,000,000 Television 9.7

400,000,000 Asia Pacific Radio 8.3 300,000,000

200,000,000 Newspapers 0.7

100,000,000 Magazines 4.9 - 2008 2009 2010 2011 2015 Source: Nielsen Q2 2011 Global Adview Pulse Lite Asia Pacific Total of Non Asia Pacific E.Europe W. Europe N. America Middle East Latin America 33 Source: SNL Kagan Global Advertising Trend Year on Year % Change

33 10.7 Global Media: Television Advertising % 9.4 change year to Date 7.2 5.9 Asia Pacific 14.8 4.3 ME & Africa 8.4 1.8

Lat. America 7.7

Global Europe N.America ME & Africa Lat Amercia Asia Pacific N. America 6.4

Source: Nielsen Q2 2011 Global Adview Pulse Lite Europe 3.9

Source: Nielsen Q2 2011 Global Adview Pulse Lite Asia Pacific: Total Advertising Year on Year % Change

-10 -5 0 5 10 15 20 25

Asia’s Share of MultichannelHomes in 2011 Asia Pacific 10.7 Australia 1 China 17.3 16% 6% • Latin America Hong Kong 13.5 Indonesia 21.2 Western Europe 1% • Japan -1.6 • Middle East Malaysia 14.5 16% New Zealand 1.5 • North America Philippines 14.9 Singapore • East Europe 4.8 8% 53% South Korea -1.6 • Asia Pacific Taiwan -4.2 Thailand 8.6 Source: SNL Kagan Source: Nielsen Q2 2011 Global Adview Pulse Lite

CASBAA Q4 2011 65

There are already more multichannel connections in Asia Pacific than the rest of the world combined

A few selected tasters from the report: • 92% of people with a TV tune into multichannel • 56% of multichannel homes in the Philippines TV each month, up from 86% in 2008. (TAM have a monthly household income of more India 2011) than double the average. (Synovate Media Atlas: • Half of all Pakistan’s TV homes have Philippines 2011) multichannel TV with an 80% reach in urban • CSM data from 153 cities across China shows homes. (Medialogic 2011) that 72.3% of all viewing is via multichannel TV. There are already more multichannel (CSM China: Jan-June 2011, 153 cities) connections in Asia Pacific than the rest of the • In the first half of 2011 CTR Media Intelligence world combined, the update says. CASBAA also reported advertising expenditure of US$40bn reports that China, India, Indonesia, Malaysia, (CTR 2011) Pakistan, Philippines and Thailand are all posting • 78% of Elites and Affluents in Asia have watched double-digit revenue growth; and that, in 2010, multichannel TV in the last 30 days, 83% in the Japan, India, and China were the leading Asian case of senior management (Synovate PAX: Q3 multichannel advertising, account for nearly 80% 2010 to Q2 2011 10 Markets) of the total. • 92% of people with a TV tune into multichannel TV (AGB Nielsen: People HHI MYR 3,000+ & Astro)

asia pacific: growth of multichannel homes asia pacific TV advertising growth %

407 Multichannel TV Outpacing Terrestial 363 • Terrestrial • Multi-channel 326 291 18 16 16 255 264 % 218 228 growth 181 186 09 07 06

02 01

-01

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 -06 2006 2007 2008 2009 2010 Source: SNL Kagan, MCN, SARFT, CSM, TAM India, SKY, Gallup Pakistan, Starhub, SingTel, Kantar, Nielsen Source: PWC LLP, Wilkofsky Gruen Assoc

Multichannel TV viewers are the most affluent Viewers paying for TV, watch more TV

Profile of Affluent Adult Viewers With and Without Multichannel TV % % Share of Viewing • Terrestrial TV • Multichannel TV • Terrestrial TV • Multichannel TV

60 87 77 47 47 47 48 46 73 43 44 66 27 42 64 32 31 55 28 52 25 23 48 45

13 36 34 28 23 13 India Taiwan Asia Pac* Australia Malaysia Singapore Philippines Hong Kong

Market Australia Taiwan Malaysia Singapore Philippines India Hong Kong Market Australia Taiwan Malaysia Singapore Philippines India Hong Kong

HH Income/ Occupation NT$ 70,000 RM 3,000 S$5,000 SEC ABC SEC A/B HK$30,000 HH Income/ NT$100,000+ MYR3,000+ NZ$40,000+ ABC1 KR4,400 HK$30,000+ RMB2600+ Social Group Group 1/2 Social Group

Source: Local Peoplemeter (Jan-Jun 2011)*Asia Pac: 7 markets (India, Australia, Taiwan, Malaysia, Singapore, Philippines, Hong Kong) Source: Peoplemeter (Jan-Jun 2011) SOV in Pay Homes

CASBAA Q4 2011 67 COMMITTEES CASBAA CASBAA CASBAA CASBAA Advertising CSR Connected Satellite & Research Committee Media & Industry

COUNCIL MEMBER Committee RESPONSIBLE & CO-CHAIR Mobility Group Committee DOUG FRASER council Member Responsible Australia Network BOARD MEMBER RESPONSIBLE BOARD MEMBER RESPONSIBLE Tom Keaveny CHRISTINE FELLOWES ANDREW JORDAN Discovery Networks Asia Pacific Universal Networks International CO-CHAIR GE Satellite BEN WAY Members Macquarie Co-Chair CHAIRMAN Wanda Gill NICHOLAS WODTKE PAUL BROWN-KENYON Discovery Networks Asia Pacific Disney Media Distribution Members MEASAT ROHANA ROZHAN Anand Rego Co-Chair Astro Members ESPN STAR Sports ALEXANDRE MULLER HUANG BAO ZHONG TV5MONDE ROBERT GILBY APT Satellite KAY YIN Disney Media Distribution Irdeto Members richard bowles GABRIELA KENNEDY RICHARD WOO Jeffrey Yan Arianespace Hogan Lovells AETN International Microsoft Bill Wade BENJAMIN LIAN PAUL FINSTER Greg Ho AsiaSat Irdeto Ericsson SPE Networks Asia RAYMOND CHOW PAUL BROWN-KENYON EDWINA NGAO Rix Yu MEASAT Fox International Channels/NGC ABS Fox International Channels RAJINDER SIDHU BENJAMIN LIAN stephane vesual Parintra Bulvatana The MGM Channel Irdeto EADS Astrium TrueVisions

JASON SOH KEVIN JENNINGS Gregg Daffner Duncan Morris The MGM Channel Microsoft Advertising EchoStar International Turner International Jeffrey Yan LOUIS NONOUCHI Soo Yew Weng HENRY ROBLES Microsoft MTV Networks Asia GlobeCast Universal Networks International PAUL JACKSON JI HEE NAM JANE BUCKTHOUGHT JOHN HUDDLE NDS Asia Pacific MTV Networks Asia CASBAA Intelsat JEANETTE CHAN Andrew Tan Nagravision Asia DAVID BALL Paul, Weiss NewSat ELIAS ZACCACK Paul Jackson Deepak Mathur SES WORLD SKIES NDS SES world skies JOY KAUNG JANICE LEE Sony Pictures Television PCCW MAX CHUNG Sky Perfect JSAT LOUISA BENCH ringo chan Turner International Asia Pacific Turner International Asia Pacific RYUJI SASAKI Sky Perfect JSAT MARK LEE ROMAIN OUDART TVBI TV5MONDE NGUYEN THI KIEU VAN VINASAT ADELA CHEN Tan wee-tuck Universal Networks International CASBAA KEN LAM CASBAA JILL GRINDA ADELA CHEN CASBAA CASBAA SIMON TWISTON-DAVIES AMANDA YANG CASBAA CASBAA

JILL GRINDA CASBAA

68 CASBAA Q4 2011 CASBAA voo chih yeong CASBAA CASBAA SPE Networks-Aisa

Regulatory & TIM GOODCHILD Technology Operator‘s Anti-Piracy StarHub Advisory Group Belinda Lui Time Warner BOARD MEMBER Committee Group RESPONSIBLE jesse chang sompan Charumilinda BOARD MEMBER RESPONSIBLE TransAsia Lawyers BOARD MEMBER RESPONSIBLE STEVE MARCOPOTO JANICE LEE TrueVisions Turner Broadcasting System Asia SOMPAN CHARUMILINDA PCCW Pacific TrueVisions CHAIRMAN CO-CHAIR BEN WAY Co-Chair ANNABEL ARCHER MATT MCDONALD Macquarie BOBBI CAMPBELL Turner Broadcasting System Asia Sony Pictures Television Disney Media Distribution Pacific Members CO-CHAIR Januar Chandra Co-Chair desmond Chan TAN YEE TIANG AORA andrew marshall TVB Disney Media Distribution ESPN Star Sports Rohana Rozhan ALEC SKELTON Members Astro Members Universal Networks International AARON SHAW SEAN LANGSTON Ascent Media Yi-Fong Chang ABS CHRISTOPHER HOARE Chunghwa Telecommunications Viaccess LAILA saat DAVID THOMAS Bert Klein Astro Astro TARUN MEHRA EchoStar Zee International ROBIN CHALMERS ANG SOO KHOON Lindsay Jorgensen BBC Worldwide john Medeiros BBC Worldwide HiTRON Casbaa kristen tong KEVIN PILLAR Celestial Pictures Discovery Networks Janice Lee International PCCW REKHA MAHENDRAN Discovery Networks Asia Pacific SABIL SALIM Ray Montinola ESPN STAR Sports Corporation Gushi Sethi Eurosport VINCENT TEO Neil Montefiore HBO StarHub SOO JUNG BHANG

GlobeCast DESMOND SUI MENG POON Thomas Ee StarHub Taiwan Broadband LAWRENCE YUEN Communications HBO Asia ERIC LAI Lola Maris Gabriela Kennedy Turner International AP Telkomvision Hogan Lovells BRIAN WONG Jerry Park CASBAA Jeremy Kung Irdeto TM Net JILL GRINDA Jeffrey Yan CASBAA Manuel Rougeron Microsoft VSTV

PASCAL METRAL JILL GRINDA Nagravision CASBAA

Joe Welch Newscorp yasuko takahashi NHK World

Avigail Gutman NDS

HANS-GUNTHER HERRMANN Paul, Weiss

GRACE PAUL SingTel

CASBAA Q4 2011 69

CEO MEMO

If any organization fails to listen to its customers it won’t be long before it hits a brick wall Listening to our members Planning ahead for 2012

couple of months ago a potential Patron region’s approximately 400 million multichannel Member of CASBAA asked: “What is the households, especially from advertising and most important area of responsibility for traditional cabsat distribution agreements; key the Executive Office?” I considered for a markets for CASBAA must remain India, Indonesia, momentA and responded: “Consultation!” Thailand, Malaysia, China and Vietnam; given a Without doubt the most critical part of the job newly outward looking approach from Japan, spend for the Executive Office, the Directors and the some time creating a CASBAA strategy for that Council of Governors, is to listen to Members. market; the same applies to Korea; IPR protection They (you!) are CASBAA’s shareholders, our clients (piracy in all its forms) must remain a priority. and our partners. If any organization fails to listen In the coming weeks the Executive Office will to its customers it won’t be long before it hits a present its 2012 work plan to the Chairman and the brick wall. CASBAA and its executives must be as Board Directors and the Council will be asked to reactive as possible to the needs of the Members. endorse the outline. That’s why an annual consultation exercise CASBAA will have also co-hosted an anti-piracy undertaken during the first meeting of CASBAA’s meeting in Singapore with the Motion Picture leading advisory board, the Council of Governors Association to bring into focus the billions lost due (CoG), is so important when setting the direction for to digital leakage by individuals and corporations the Association. that just “won’t pay”! While online losses are largely The November 2011 meeting of almost 40 uncountable and immeasurable, the annual cost of council members, which followed hard on the piracy is estimated to now top US$2,142 million and heels of the AGM, broke into four groups to remains a global challenge to our business. compile what should be CASBAA’s top priorities for As well, coming up on December 13, the the coming 12 months. Association will be hosting its first ever TV Upfronts Should we concentrate more on advertising? in Singapore – a half-day networking and preview Should the Association target a particular market experience for media buyers, agency heads and (Pakistan? Vietnam? Taiwan?) with a renewed ATAC stakeholders. regulatory focus? How much emphasis should Finally, wrapping up the Convention 2011, CASBAA place on OTT in 2012? What events will I am pleased to report that responses to the event bring the best value to Members? Is there a need (especially the conference programme and the parties) for a CASBAA Members Report on a specific sector have been universally positive. But perhaps there (Satellite services? Mobile TV? and again, OTT?)? was less awareness about the increased development When aggregating inputs from our break-out of the “side events”, such as the invitation only groups, it became clear that new areas of activity Regulators Roundtable; the Meeting of the CASBAA in 2012 must definitely include the creation of an Operators Group, the half day workshop dedicated OTT/TV Everywhere CASBAA group to exchange to cross media measurement; the satellite services information on both business models and regulatory breakfast meeting; pay-TV audience breakfast. We frameworks. We must also look at both regional and believe these segments added value to the Convention global experiences within the fastest developing 2011 and we would like to do more in 2012. multi-channel TV distribution sector, the telcos. From everyone here at CASBAA, we wish you a Another clear takeaway was that we must festive holiday season and a very prosperous New Year! never forget our core revenues accrued from the Simon Twiston Davies

CASBAA Q4 2011 71

CONVENTION 2011: A NEW CONVERSATION

TV UPFRONTS: THE SINGAPORE SCREENINGS

SAT TV: ITS AMAZING BEGINNINGS

PAY-TV REGULATION: OVER THE TOP?

COUNTRY REPORTS: KOREA, INDONESIA www.casbaa.com Volume 6 Number 4

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