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IPTV drives Asia’s pay TV growth

The Asia Pacific pay TV sector is vibrant, with both subscribers (up by 68 million) and revenues (up by $2.35 billion) forecast to rise over the next five years. However, these forecasts are lower than the previous Asia Pacific Pay TV Forecasts report, mainly due to many cable subs in China converting to OTT.

Asia Pacific: Split of TV households by platform (million) 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 2018 2019 2024 Analog Terrestrial 63 55 2 Pay DTT 2 2 3 FTA DTT 136 138 189 FTA Sat 89 91 98 Pay Sat 83 83 89 Pay IPTV 189 217 272 Digital cable 306 309 317 Analog cable 33 17 0

Source: Digital TV Research Ltd

Simon Murray, Principal Analyst at Digital TV Research, said: “IPTV is the biggest pay TV winner – adding 83 million subscribers between 2018 and 2024 to take its total to 272 million. Much of this growth will happen in China [up by 40 million] as cable subs convert to OTT or IPTV and in India [up by 28 million].”

Reliance is poised to shake up India’s staid fixed broadband sector with its Jio GigaFiber operation as it has done in the mobile sector. , the region’s third most populous country, will also enjoy substantial IPTV growth.

Cable will suffer. Digital cable subscriptions will be flat overall. China will lose 25 million cable subs between 2018 and 2024, although India will add 13 million. Analog cable subscriptions will fall by 33 million.

The pay satellite TV sector is mature, with only 6 million subscribers to be added between 2018 and 2024 to take the total to 89 million. Due to mainly to consolidation, India will lose nearly 3 million subscribers.

China and India together will account for 80% of the region’s 681 million pay TV subscribers by 2024. About 68 million pay TV subs will be added between 2018 and 2024, with China and India together supplying two-thirds of the extra subs – so they will grow at a slower rate than the rest of the region.

Asia Pacific Pay TV Forecasts

Table of Contents

Published in March 2019, this 226-page PDF, PowerPoint and excel report comes in three parts:

• Outlook: Forecasts for 22 countries in a 61-page PowerPoint document full of charts, graphs and bullet points; • Excel workbook covering each year from 2010 to 2024 for 22 countries by household penetration, by pay TV subscribers, by pay TV revenues and by major operator. As well as summary tables by country and by platform; • Insight: Detailed country-by-country analysis in an 85-page PDF document.

For more information, please click here or contact [email protected]

Forecasts for the following 22 countries and 75 platforms:

Country No of ops Platform forecasts Australia 1 Bangladesh 1 RealVU Cambodia 3 CDN; One TV; One China 4 China Radio & TV; China Telecom; BesTV; China Unicom Hong Kong 2 i-cable; Now TV India 12 ; GTPL; Siti; In Digital; DEN; Dish TV; ; Videocon; Airtel; ; Independent; MTNL Indonesia 9 Linknet; ; Indovision; Top TV; Okevision; Orange TV; Big TV; Telkom; NexMedia Japan 3 SkyPerfecTV; J:Com; NTT Laos Malaysia 2 ; TM Mongolia 2 Univision; DDish Myanmar 2 SkyNet; 4TV/MRTV (Forever) Nepal 1 Dish Media New Zealand 2 Sky; Vodafone Pakistan 1 PTCL 2 /; Singapore 2 StarHub; SingTel TV S Korea 9 CJ Hellovision; T Broad; D’Live; CMB; Hyundai HCN; KT Olleh; Skylife; B TV; LG U+ Sri Lanka 2 Dialog; Peo Taiwan 4 Taiwan Broadband; TWM; CNS; CHT Thailand 3 Truevisions; TOT; AIS Vietnam 8 SCTV; VTVCab; HTV-CMS; VNPT; Viettel; FPT; K+; MobiTV

Indonesia pay TV insight

• Indonesia’s pay TV sector has traditionally been fairly low-key and insular. Attempts by foreigners to break into the market have not been successful. However, reports in December 2018 claimed that France’s Vivendi was interested in taking stakes in MCN Vision Networks (50%) and Media Nusantata (10%).

• However, the biggest shake-up is coming from Telkom’s Indihome. Telkom is adding IPTV subscribers rapidly to its Indihome triple-play and dual-play packages.

Main assumptions behind the forecasts • Our TV household forecasts are higher than the last edition • Pay TV penetration will continue to be pushed up by Telkom. • The flurry of satellite TV activity now will be replaced by a flurry of IPTV activity, with Telkom gaining the most. • Substantial investment in broadband networks will result in more bundle offers. • There are many satellite TV operators in Indonesia. Not all of them will survive, with several already folding. Satellite TV growth will be limited. • Intense competition is forcing down ARPUs. • Analog terrestrial switch-off is scheduled for 2018, but we do not expect it to happen until after 2024. • GDP growth forecasts have been lowered by the IMF. Source: Digital TV Research

• Pay TV penetration reached only 21.2% (9.01 million) of TV households by end-2018. This proportion will climb rapidly to 35.1% (17.50 million) by 2024.

• The number of IPTV homes will rise from 5.10 million in 2018 to 13.11 million in 2024. The number of paying IPTV homes overtook pay satellite subs in 2017. However, the proportion of homes paying for satellite TV will slowly decline. There are too many satellite TV platforms, with several expected to fold.

• Pay TV revenues will double from $884 million in 2018 to $1,670 million in 2024. IPTV will provide $1,107 million of the 2024 total; nearly triple 2018.

• Piracy remains a major problem, with 2-3 million homes receiving illegal signals from as many as 2,500 operators (charging as little as a tenth of the average fee from the legitimate operators).

• Launched in late 2014, Telkom had 4.71 million Indihome subs (52% triple-play and the rest dual-play) by September 2018; more than double from the previous year. Standalone TV services are not available. Indihome exceeded 5 million subs by end-2018 and wants 7.5 million by end-2019. We expect 12.72 million TV subs by 2024.

• IndiHome provides 100 SD channels and 31 HD ones as part of its triple-play fiber packs. IndiHome also gives access to Catchplay, HOOQ and . Its IPTV network (confusingly called Usee TV Cable) also incorporates on-demand services such as HBO.

• About 52.09% owned by the government, Telkom had 5.3 million fixed broadband subscribers (up to 100Mbps) by end-2017. The company had passed 18.6 million premises with fiber by end-2017. Telkom also had 168 million mobile subscribers at September 2018.

MNC Vision subscriber growth (000) ARPU IDR Total Indovision Top TV Okevision 2010 143,845 804 631 173 0 2011 125,430 1,163 752 335 76 2012 123,203 1,720 933 583 204 2013 114,259 2,300 1,175 774 351 2014 101,247 2,529 1,289 838 402 2015 102,946 2,433 1,139 881 412 2016 92,060 2,496 1,222 898 376 Source: MNC

• MNC Vision (trading as Indovision, Okevision and Top TV) had 2.50 million satellite TV subs by end-2017; flat year-on-year. We forecast a total of 2.60 million subscribers by 2024.

• Global controls 79.52% of MCN Vision and also owns four major FTA broadcasters such as RCTI, MNC, iNewsTV and Global TV. Its satellite TV platforms provide 137 channels, including 33 exclusive ones.

• MNC Kabel Mediakom is a fledgling FTTH network, with 1.2 million homes passed by end-2017. MNC Play had 175,000 residential customers at end- 2017; up from 116,000 a year earlier. Its IPTV platform supplies 177 channels, including 38 exclusive ones as well as those from beIN. MNC Play is not available as a standalone service. SVOD platform MNC Now provides more than 80 linear channels and 5,000 hours of on-demand content.

• Transvision had 879,000 satellite TV (mainly pre-paid) and cable TV subscribers at end-2014. We estimate 433,000 subscribers across all platforms by end-2018, rising to 483,000 by 2024. In June 2013, CT Corp, owned by billionaire Chairul Tanjung and through its Transmedia subsidiary, acquired an 80% stake in TelkomVision from Telkom.

• In October 2011, Mega Media (controlled by the Sinar Mas Group) launched the Orange TV satellite platform. Orange also offers beIN channels. Orange provides both prepaid and postpaid subscriptions. The company targets middle to lower income subscribers. We forecast 115,000 satellite TV subs by 2024. Orange launched an OTT mobile service in late 2013.

• IMTV started its satellite TV operation, BigTV, in September 2013 – aiming to attract the growing middle class with 64-93 channels for INR130,000- 510,000/month ($9.14-35.85). Indonesia Media Televisi is a subsidiary of the Lippo Group, which also owns First Media. We expect 48,000 subs by 2024.

• There are 20 licensed satellite TV operators. Skynindo is among the smaller satellite platforms. Launched in December 2010, Satellite TV went bust in late 2015, followed by Viva Plus. Owned by Kompas Gramedia Group, K- Vision launched a prepaid platform in March 2014.

• Philippines-based ABS and Sarana Media Vision launched a 60-channel FTA satellite TV platform called in February 2017. SMV holds a satellite TV license.

LinkNet operating data (000) 2014 2015 2016 2017 3Q18 Homes passed 1,433 1,673 1,826 2,000 2,150 TV subs 363 433 503 551 Broadband subs 392 457 521 570 Source: LinkNet

• LinkNet, trading as HomeCable, passed 2.15 million premises by September 2018 and wants to pass 2.8 million homes by 2021. LinkNet is also constructing an ADSL and fiber network. About 95% of customers take both TV and broadband services. We forecast 798,000 TV subs by 2024. LinkNet launched an IPO in mid-2014 for a third of its equity. Lippo Group-owned First Media controls 26.26%, with CVC taking 33%. In August 2018, Axiata was reported to be interested in the CVC stake. Linknet carries HOOQ.

• The government aims to increase broadband premises passed from 30% of households (20 million) by end-2015 to 40% (25 million) by 2018 and more than 50% (35 million) in 2025. Telkom will construct the national broadband network, called True Broadband, at a cost of $24 billion. Speeds range from 20Mbps to 100Mbps. The ITU estimated 6,044,712 million fixed broadband subscribers by end-2017.

• Part owned by Sinar Mas, broadband operator MyRepublic had 140,000 subs (up to 300Mbps) by mid-2017 from 500,000 homes passed. Its TV package provides 60 channels for IDR96,250/month (prices nearly halved in 2018).

• XL Axiata began offering triple-play bundles in in May 2018. XL Axiata had 54.91 million mobile subscribers by end-2018, of which 80% had smartphones. The operator promotes Iflix.

• National analog terrestrial switch-off was scheduled for January 2018, but it was postponed for legal and technical reasons to March 2023. We do not believe that this will happen until 2024. The Ministry of Communications and Information announced the adoption of the DVB-T2 standard in February 2012. The government has allocated IDR300 billion for 1 million settop boxes, which will be distributed to poorer households.

• Sister company of MNC Skyvision, is constructing a DTT network. Running the MNCTV, RCTI, iNewsTV and Global TV terrestrial FTA channels, MNC also operates 23 pay TV channels. Viva Group, owner of the tvOne and channels, also holds a DTT multiplex license (covering Java).

• Launched in November 2011, Nexmedia, a division of the Emtek Group which also runs FTA channels SCTV and IVM/, began as a pay DTT operator (DVB-T2) in the Greater Jakarta area, with expansion soon after to east Java. Nexmedia (also known as Mediatama Anugrah Citra) had 124,000 subscribers by end-2014. We forecast 199,000 subs by 2024.

• The International Monetary Fund forecasts that Indonesia’s Gross Domestic Product will grow below the regional average for the next five years. GDP per capita was $3,789 in 2018. Indonesia’s population was 265 million in 2018, and is growing above the regional average.

• Joko Widodo was elected as president in July 2014 in a closely fought election. Widodo, known as Jokowi, is not part of the dynasty that has ruled Indonesia since independence. Appealing to ordinary Indonesians, he aims to deal with the widespread corruption.

Indonesia pay TV forecasts

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Total households (000) TV households (000) Digital cable subs (000) Analog cable subs (000) Pay IPTV subscribers (000) Pay Satellite TV subs (000) FTA satellite TV hholds (000) Analog terrestrial hholds (000) Primary FTA DTT hholds (000) Primary Pay DTT hholds (000)

Digital homes (000) Analog homes (000) Pay TV subscribers (000) Total DTT households (000)

Digital cable subs/TV HH Analog cable subs/TV HH Pay IPTV subs/TV HH Pay Satellite TV/TV HH Free-to-air satellite TV/TV HH Analog terrestrial/TVHH Primary FTA DTT/TV HH Primary pay DTT/TV HH

TVHH/Total HH Digital/TV HH Analog/TV HH Pay TV Subs/TV HH Total DTT/TV HH

Stand-alone dig cab subs (000) Dual-play dig cable subs (000) Triple-play dig cable subs (000)

Stand-alone pay IPTV subs (000) Dual-play pay IPTV subs (000) Triple-play pay IPTV subs (000)

Indonesia pay TV forecasts

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Revenues (US$ million) Stand-alone digital cable revs Dual-play digital cable TV revs Triple-play digital cable TV revs Digital cable TV subs revenues Digital cable TV on-demand revs Digital cable TV revenues Analog cable TV subs revs Cable TV revenues

Stand-alone IPTV revenues Dual-play IPTV revenues Triple-play IPTV revenues IPTV subscription revenues IPTV on-demand revenues IPTV revenues

Satellite TV subscription revs Satellite TV on-demand revs Satellite TV revenues

DTT subscription revs DTT on-demand revenues DTT revenues

Subscription revenues On-demand revenues Total revenues

Average Revenue Per User (ARPU - US$) Stand-alone digital cable subs Dual-play digital cable TV subs Triple-play digital cable TV subs Ave digital cable (subs & VOD) Analog cable TV subs Stand-alone IPTV subs Dual-play IPTV subs Triple-play IPTV subs Average IPTV (subs and VOD) Pay Satellite TV (subs) Pay Satellite TV (subs and PPV) Pay DTT (subs) Pay DTT (subs and PPV) Average monthly ARPU

Indonesia pay TV forecasts

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Pay TV subscribers by operator (000) Linknet (digital cable) Transvision (digital cable) Transvision (satellite) Transvision (total) Indovision (satellite) Top TV (satellite) Okevision (satellite) MNC Skyvision (total) Orange TV (satellite) Big TV (satellite) Telkom (IPTV) NexMedia (DTT) Others

Share of pay TV subs by operator % Linknet (digital cable) Transvision (digital cable) Transvision (satellite) Transvision (total) Indovision (satellite) Top TV (satellite) Okevision (satellite) MNC Skyvision (total) Orange TV (satellite) Big TV (satellite) Telkom (IPTV) NexMedia (DTT) Others

Subscription & VOD revenues (US$ million) Linknet (digital cable) Transvision (digital cable) Transvision (satellite) Transvision (total) Indovision (satellite) Top TV (satellite) Okevision (satellite) MNC Skyvision (total) Orange TV (satellite) Big TV (satellite) Telkom (IPTV) NexMedia (DTT) Others

Indonesia pay TV forecasts

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Share of pay TV revenues by operator % Linknet (digital cable) Transvision (digital cable) Transvision (satellite) Transvision (total) Indovision (satellite) Top TV (satellite) Okevision (satellite) MNC Skyvision (total) Orange TV (satellite) Big TV (satellite) Telkom (IPTV) NexMedia (DTT) Others

Average Revenue Per User (ARPU - US$) Linknet (digital cable) Transvision (digital cable) Transvision (satellite) Indovision (satellite) Top TV (satellite) Okevision (satellite) Orange TV (satellite) Big TV (satellite) Telkom (IPTV) NexMedia (DTT)

Source: digital TV research

Indonesia pay TV outlook

Homes by platform (000) 60,000 50,000 40,000 30,000 20,000 10,000 0 2017 2018 2019 2020 2024 A terres 25,567 22,007 17,739 14,475 0 Pay DTT 165 170 175 179 199 Free DTT 6,206 8,498 10,909 13,444 28,616 Free satellite 2,482 2,974 3,273 3,361 3,739 Pay Satellite 3,020 2,974 3,011 3,047 3,191 IPTV 3,227 5,100 7,700 9,411 13,111 A Cable 0 0 0 0 0 D cable 703 765 829 896 997

Revenues by platform ($m) 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 2017 2018 2019 2020 2024 Pay DTT 18 19 19 20 22 Pay Satellite 380 372 372 376 394 IPTV 229 374 575 768 1,107 A Cable 0 0 0 0 0 D cable 111 119 128 136 147

Indonesia pay TV outlook

Pay TV subs by operator (000) 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 2017 2018 2019 2020 2024 Others 372 218 325 415 538 NexMedia 165 170 175 179 199 Telkom 2,965 5,000 7,500 9,128 12,718 Big TV 45 45 45 46 48 Orange TV 112 107 108 110 115 Okevision 347 342 346 350 367 Top TV 906 892 903 914 957 Indovision 1,208 1,190 1,204 1,219 1,276 Transvision 433 433 444 455 483 Linknet 563 612 663 717 798

Pay TV revenues by operator ($m) 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 2017 2018 2019 2020 2024 Others 42 36 34 43 55 NexMedia 18 19 19 20 22 Telkom 206 358 562 747 1,074 Big TV 6 6 6 6 6 Orange TV 13 12 12 12 12 Okevision 38 36 36 37 39 Top TV 95 95 95 96 100 Indovision 151 149 149 150 158 Transvision 81 79 80 81 86 Linknet 88 95 102 109 118

Digital TV Research publication schedule 2019 Asia Pacific Pay TV Forecasts March £1000/€1200/$1300 Middle East & North Africa OTT TV & Video February £1000/€1200/$1300 Forecasts Middle East & North Africa Pay TV Forecasts January £1000/€1200/$1300 Sub-Saharan Africa Pay TV Forecasts January £1000/€1200/$1300 Sub-Saharan Africa OTT TV & Video Forecasts January £1000/€1200/$1300

2018 European TV Databook November £750/€900/$975 SVOD Databook November £650/€780/$845 TV Forecasts October £1500/€1800/$1950 Western Europe TV Outlook October £1200/€1440/$1560 TV Databook October £1000/€1200/$1300 SVOD Outlook by Country October £1000/€1200/$1300 Eastern Europe OTT TV & Video Forecasts September £1000/€1200/$1300 Western Europe OTT TV & Video Forecasts September £1000/€1200/$1300 Global OTT TV & Video Forecasts September £1800/€2160/$2340 Global SVOD Forecasts September £1500/€1800/$1950 Latin America OTT TV & Video Forecasts August £1000/€1200/$1300 North America OTT TV & Video Forecasts August £500/€600/$650 Asia Pacific OTT TV & Video Forecasts July £1000/€1200/$1300 Pay TV Subscriber Prospects May £800/€960/$1040 Pay TV Revenue Prospects May £800/€960/$1040 vMVPD and D2C TV Forecasts May £900/€1,080/$1170 Forecasts May £700/€840/$910 Global Pay TV Subscriber Forecasts April £1500/€1800/$1950 Global Pay TV Revenue Forecasts April £1500/€1800/$1950 Global Pay TV Operator Forecasts April £1500/€1800/$1950 Latin America Pay TV Forecasts March £1200/€1440/$1560 North America Pay TV Forecasts March £500/€600/$650 Eastern Europe Pay TV Forecasts March £1200/€1440/$1560 Western Europe Pay TV Forecasts March £1200/€1440/$1560

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