digital tv asia pacific briefings pdf

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Digital TV Asia Pacific

Published: May 2011

Author: Simon Murray

Copyright: Digital TV Research Ltd

Copyright notice: No part of this publication may be copied, duplicated or photocopied without written consent from Digital TV Research Ltd.

T Table of contents:

Executive summary

Australia digital TV briefing

China digital TV briefing

Hong Kong digital TV briefing

India digital TV briefing

Indonesia digital TV briefing

Japan digital TV briefing

Malaysia digital TV briefing

New Zealand digital TV briefing

Pakistan digital TV briefing

Philippines digital TV briefing

Singapore digital TV briefing

South Korea digital TV briefing

Sri Lanka digital TV briefing

Taiwan digital TV briefing

Thailand digital TV briefing

Vietnam digital TV briefing

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Executive Summary

Asia Pacific is undergoing a digital TV boom that will see penetration increase from 29% in 2010 to 73% in 2016 – or up nearly 400 million homes. Fast-growth economies, higher disposable incomes and rising populations lead this expansion. These factors will also result in 92 million more TV households between 2010 and 2016.

Asia Pacific TV households by platform (000)

Source: Digital TV Research Ltd

China and India have a massive influence over the region, due mainly to their 1 billion-plus populations. Together, they will have 608 million TV households (73% of the region’s total) by 2016. They will provide 467 million digital TV homes combined – or 77% of Asia Pacific’s total.

Although China and India dominate the region, several other large countries, especially Indonesia, Pakistan, the Philippines, Thailand and Vietnam, have underdeveloped TV markets. By 2016, these five countries will have 127 million TV households combined, but only 38% digital penetration and 24% pay TV penetration.

Despite the rapid conversion, digital TV will still have plenty of room for growth for some time to come. By 2016, Indonesia and the Philippines will still have analog penetration of 85% and 79% respectively. China will have 83 million analog homes and India 58 million.

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Of the 388 million digital homes to be added between 2010 and 2016, 68 million will come from DTT. Digital cable will contribute a further 188 million and pay DTH 29 million, with pay IPTV supplying a further 85 million.

Asia Pacific digital TV households split by country in 2016 (mil.)


So pay TV penetration will rise from 49% in 2010 to 63% in 2016, adding 156 million subs to take the total to 522 million. China will provide 296 million pay TV households, with India supplying a further 133 million. However, pay TV penetration will be higher in South Korea (91%) and Hong Kong (85%). Legitimate pay TV penetration will be lowest in Indonesia (7%), with the Philippines and Thailand the next lowest, with 23% each. Piracy remains a serious problem.

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Asia Pacific pay TV revenues (US$ mil.)


Pay TV revenues in Asia Pacific will be US$16.5 billion higher in 2016 (US$37.3 billion total) than in 2010. Japan (US$9.9 billion) will remain market leader in 2016, followed by China (US$8.5 billion) and India (US$7.8 billion). However, pay TV revenues will be flat in Australia, Hong Kong, Singapore and South Korea.

ARPU is very low in some major countries such as China and India, with several governments controlling prices. In developed countries, there is downward pressure on ARPU as pay TV competition increases and as DTT makes an impact. Additionally, rapid growth in higher-speed broadband connections allows more online video viewing (over-the-top).

ARPU is also being forced down as cable operators and telcos convert their subscribers to dual-play or triple-play bundles.

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Asia Pacific pay TV revenues split by country in 2016 (US$ million)

Source: Digital TV Research Ltd.

Cable TV will remain the highest earner, though its revenues will remain flat at US$21 billion during the forecast period. Digital cable TV revenues will climb by US$10.2 billion between 2010 and 2016 to US$17.3 billion, with analog cable TV falling from US$12.2 billion to US$4.2 billion.

There will be 358 million cable homes by 2016, up only 42 million from 316 million at end-2010. Cable penetration will be 43.0% by 2016, almost unchanged from 42.6% at end-2010.

The good news for cable operators is that the number of digital subs will nearly triple over the same period to nearly 300 million, though the analog total will fall to a third of its 2010 total. Digital cable penetration will be highest in China (52%), Singapore (47%) and South Korea (43%) by 2016. China and India will together supply 88% the total digital subs.

Although the total is falling rapidly, there will still be 59 million analog cable subs (7.1% of TV households) by 2016. About 38% of Taiwan’s TV households will still receive analog cable signals by 2016, with Pakistan on 27%. India will still have 41 million analog cable subs in 2016.

Cable operators are increasingly following the example set by the telcos, with a greater emphasis on broadband speeds than on TV services. This emphasis on broadband intensified as incumbent telcos become more involved in offering bundled services. For many telcos, TV is a periphery activity in their bundles. Telcos usually provide few channels in their basic packages. The telcos provide premium channels, but spend most effort on promoting their lower-cost bundles.

The number of homes paying for IPTV will take off from a low base to reach nearly 100 million by 2016 – or 11.8% of TV households. IPTV penetration will be

9,856

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6,656Japan

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highest in Hong Kong and Singapore in 2016, at 38% and 36% respectively. China will contribute 70 million IPTV subs by 2016. IPTV revenues will climb to US$5.4 billion by 2016, up from only US$1.1 billion in 2010. China and Japan will each supply US$1.6 billion to the 2016 total.

IPTV subs will overtake pay DTH ones in 2013. Nearly 30 million pay DTH homes will be added between 2010 and 2016, taking the total to 66 million (or 7.9% of TV households). India (45 million – or two-thirds of the regional total) will be the largest country by DTH subscribers, but penetration will be higher in Malaysia (40%) and New Zealand (39%). India will generate US$3.2 billion of the region’s US$10.3 billion DTH revenues in 2016. The number of free DTH homes will reach 52 million by 2016, up from 34 million in 2010.

After a slow start, DTT is taking off. Primary DTT households (homes not subscribing to cable, DTH or IPTV but taking DTT) will rocket from 24 million (3.2% penetration) at end-2010 to 92 million (11.1%) by 2016. China will provide 52 million of the 2016 total, followed by Japan with 12 million. However, penetration will be higher in Australia (66%) and Malaysia (31%).

Analog terrestrial signals will still be received in 20% of TV households (168 million) by 2016, though this is well down on 43% (318 million) at end-2010. In fact, analog terrestrial penetration will still be very high in Indonesia (85%) and the Philippines (71%) in 2016. China will have 83 million ATT homes at end-2016, with India supplying a further 41 million.


Australia digital TV briefing

Pay TV subscriber growth is stagnating. OzTAM estimated pay TV penetration at 29.6% (2.39 million) of the 8.08 million TV households at end-2010. This was up from 28% penetration at end-2009. This is low given Australia’s wealth and booming economy. Pay TV started as late as the mid-1990s, with heavy government regulation in place (including the anti-siphoning rules, see below). Given the lack of competition, pay TV is considered expensive. Furthermore, DTT has had widespread acceptance since its 2001 start.

The Department of Broadband Communications and the Digital Economy’s Digital Tracker estimated that 79% of homes were digital by March 2011, up from 47% two years earlier and 77% at end-2010. The difference between this figure and pay TV take-up is almost entirely due to DTT. OzTAM estimated 34.7% DVR penetration at end-2010.

Foxtel is the pay TV leader, way ahead of Austar. However, the two are not rivals as they do not operate in each others’ territories. Foxtel provides Austar with most of its program packages.

In March 2011, speculation suggested that Foxtel was considering the takeover of Austar, pending shareholder and regulatory approval.

The government wants Telstra to sell its 50% share in Foxtel. The remaining equity in Foxtel is equally split between Publishing and Broadcasting Ltd and News Corp. The government also wants Telstra to separate its wholesale and retail businesses. Foxtel had 1.63 million subscribers by end-2010, including 80,000 wholesale customers (nearly all of which are Optus cable TV subs), up from 1.62 million at end-2009. Foxtel’s direct subscriber base is split evenly between cable and DTH. DVR penetration reached 70% by end-2010, up from 55% a year earlier, with multiroom penetration at 31%. About a quarter of subs (around 400,000) took Foxtel’s 20-channel HD package at end-2010, up from 200,000 a year earlier. Annualized monthly churn was 12.5% for 2H10, down from 13.3% a year earlier.

Austar had 764,219 subs (mostly DTH) from 2.54 million homes passed by end-2010. Austar also had 193,588 MyStar DVR subscribers at end-2010, of which 70,917 took the MyStar HD DVR service. Liberty Global holds an indirect 54.2% stake in Austar through its ownership of UAP and United AUN, with the rest of the equity floated.


Optus is the only cable TV operator, but its subscriber numbers are falling. Foxtel manages the TV services for SingTel-owned Optus. It had about 80,000 cable TV subscribers at end-2010.

There is no IPTV in Australia. Telstra would compromise its Foxtel asset if it launched an IPTV service. However, this will change once the National Broadband Network – offering internet speeds up to 1,000Mbps to 93% of the population - is built (at a cost of A$41 billion). The NBN is unlikely to be operational before 2012. Australia has been slow to press for a broadband network.

Adopting the DVB-T standard and operational since 2001, primary DTT penetration via the Freeview platform reached about half the TV households by end-2010. National analog switch-off is set for end-2013, starting on a regional basis in mid-2010. HD DTT is commonplace, though Australia’s HD definition does not fit all international definitions. OzTAM estimated that total DTT penetration for the five main cities reached 89% by April 2011, with HD DTT at 83% and DVR at 41%.

Anti-siphoning rules require that 11 sports events are carried on free-to-air

TV; much to the chagrin of the pay TV operators.


China digital TV briefing

The government continues to limit foreign involvement in the TV sector; much to the frustration of the international players which want to expand into this market of 400 million TV households.

There is still confusion over some areas of responsibility between State Administration of Radio, Film and Television (SARFT) and telecoms regulator Ministry for Industry and Information Technology (MIIT), with some advocating the creation of a super-regulator.

TV regulator SARFT estimated 93 million digital cable subs from the 188 million cable subs total at end-2010. Cable networks are consolidating on a provincial level, with the SARFT drawing up a proposal for a national cable organization. National digital cable switchover is planned for 2015. Digital subscription fees are the same as analog.

The consolidation of cable assets is a response to the threat posed by IPTV. China had 6.5 million IPTV subscribers by end-2010, double the figure of a year earlier. Most IPTV subs also take cable as several IPTV networks only offer VOD and not linear channels. Many IPTV operators work together with the local cable players.

China is in the process of building a national fiber optic network, which will provide broadband speeds of 100Mbps. According to MIIT, there were 133.7 million broadband subs (of which 105.5 million were DSL) by March 2011.

Shanghai Media Group’s BesTV had more than 4 million IPTV subscribers by end-2010. SMG wants 25 million IPTV subs by end-2014 – or half the total for China.

China Telecom, in a joint venture with Shanghai Media Group, had 2 million IPTV subs by end-2010. Claiming to be the world’s largest broadband operator, the company had 63.5 million broadband subs at the same time, up 10 million on a year earlier. China Telecom wants to add a further 12 million broadband subs in 2011. It was 20Mbps to be available in all cities on southern China by 2013.

China Unicom had 49.8 million broadband subs by March 2011.


Free DTH is used to access remote communities.

DTT is available in 333 cities, with 6 million DTT homes by end-2010. The

DMB-T/H standard integrates Tsinghua University’s DMB-T and Shanghai

Jiaotong University’s ADTB-T technologies. National coverage is expected by

2012, and ATT switch-off is scheduled for 2018.


Hong Kong digital TV briefing

About 80% of Hong Kong’s 2.35 million TV homes subscribe to digital pay TV platforms. Due to homes taking more than one service, there are more multichannel subscriptions than TV households.

Hong Kong has a highly competitive market – not just for TV subscribers but also for broadband ones. The widespread acceptance of DTT puts further pressure on the pay TV players.

IPTV operator Now Broadband TV and i-Cable have had a long-running battle for TV subscriber supremacy, which has fluctuated depending on which company holds key sports rights. i-Cable regained English Premier League soccer rights in fall 2010, having lost them to Now in 2006. About 40% of EPL subscribers take the HD option. i-cable also holds the European Champions League rights until 2015. The pursuit of exclusive sports rights comes at a price, with operating costs up 30% in 2010 (though this included non-recurrent events such as the World Cup, Asian Games and Winter Olympics). i-cable increased its TV subscriber base by 10% in 2010 to 1.1 million. i-cable is also building a DOCSIS 3.0 network, with 581,000 homes activated by end-2010.

Despite losing the EPL rights, Now has exclusive rights to HBO, ESPN, Star Chinese Movies and Star News. Now also provides a quad-play service and is nearing completion of its FTTB (fiber-to-the-building) network. Now’s initial policy of providing a la carte programming forced i-cable to offer lower-priced packages, thus reducing ARPU. Although Now has an installed base of 1.04 million TV homes at end-2010, not all of these households paid for TV services. The company has stopped reported its pay TV subscriber base, but we estimate 650,000 homes.

City Telecom International controls IPTV operator Hong Kong Broadband Network Digital TV, which provides a low-cost alternative to Now and i-cable. It had 159,000 subscribers by February 2011, up only 2,000 year-on-year. CTI had 551,000 broadband subs at February 2011, with its triple-play service costing HK$199/month. CTI aggressively uses price promotions to shake up the market.

IPTV subscriptions for Now TV and HKBN reached 1.2 million by June 2010. Hutchison Global Communications has a much smaller IPTV service.


TVB Pay Vision, distributed by DTH, SMATV and IPTV, has been revitalized, including the addition of HD channels. The company had 200,000 subs by March 2011. TVB Pay Vision is 60% owned by FTA leader TVB. The ownership structure of TVB changed in January 2011.

I-cable, PCCW and City Telecom have applied for FTA DTT licenses. These should be decided upon in first-half 2011 after several delays.

DTT launched in December 2007, with TVB and ATV offering both standard

and high-definition channels. There were 1.4 million DTT homes at

September 2010, or 61% of TV households. DTT reaches 90% of the

population. Analog switch-off is set for 2012.

Hong Kong will have a unified regulator, the Communications Authority, in

2011, following the merger of the Broadcasting Authority and the

Telecommunications Authority.


India digital TV briefing

India has 140 million TV households and another 90 million that do not own a set. The number of TV households is growing at about 6 million a year. Only half of the 75 million rural homes own a set, though this figure is climbing rapidly. About 110 million households subscribe to cable and satellite.

Foreign direct investment is limited to 49% of pay TV operators’ equity, though there are moves to extend this to 74%.

DTH subscriptions reached 32 million by end-2010, up from 19 million a year earlier. However, this included about 9 million homes receiving FTA DTH signals. Much of the recent growth has been in rural homes. Monthly ARPU is as low as INR160. In mid-2010, and regulator TRAI requires the DTH operators to offer subs a la carte options. Subscriber acquisition costs are about INR2,000.

Taking advantage of regulation that forbids channel exclusivity on pay TV platforms, mobile operators Reliance and Bharti provide DTH and IPTV platforms; successfully leveraging their extensive retail networks and their deep financial resources. Price has become the main promotional tool, which drains financial resources for all the players. Dish TV, Tata Sky and Sun Direct TV have lost out as Big TV, Bharti and Videocon advance. Public broadcaster DD Direct Plus provides an FTA service to about 5 million homes.

Bharti’s Airtel Digital TV had 5.66 million subscribers by March 2011, up from 2.60 million a year earlier and 4.93 million at end-2010. Launched in June 2008, the company has distribution operations in 9,000 towns and cities.

Launched in August 2008, Reliance’s Big TV had 3.3 million subs by December 2010, up from 2.23 million subs a year earlier. Reliance Communications acquired Digicable (8.5 million subs in 46 cities) in July 2010, renaming its TV and broadband assets as Reliance Digicom.

Ultimately controlled by Zee, Dish TV crossed the 10 million subscriber mark in February 2011. It had 9.4 million ‘gross’ subscribers and 7.7 million net subs by December 2010. Dish claimed 25% of DTH subs by December 2010. ARPU was INR142 in 4Q10. Dish TV is 11% owned by US private equity fund Apollo Management.

Tata Sky, a joint venture between Star TV (20%) and the Tata Group (80%), had about 6.1 million subscribers by March 2011. The company wants 9 million subs by 2012.


Sun Direct TV had 6.4 million subs – mostly in the south – by end-2010. Sun Direct TV is a joint venture between Chennai-based Sun TV and Malaysian DTH company Astro. Sun TV provides a stable of regional-language channels, though other operators have now also moved into this area.

Videocon’s D2H wants 6 million subscribers by 2015. Claiming 3 million subs by March 2011, it has a network of 2,500 dealers and 15,000 retailers.

Digital cable rollout is stalled, due to regulatory delays. Furthermore, overbuilding has hindered operators from upgrading to more expensive digital packages. However, regulator TRAI ambitiously wants full digital cable conversion by June 2014, with December 2011 set for the four main cities and a year later for the 35 cities with populations exceeding 1 million. However, the Information and Broadcasting Ministry has more realistic deadlines of March 2015 (November 2014 for urban areas) for national conversion, March 2012 for the big four and March 2013 for the other 35 cities. Some cable operators are pre-empting this by distributing free digital settop boxes and by holding digital fees at the same level as analog. Many consider that dual-play (TV and broadband) packages will be key in future uptake.

Piracy remains a major problem, especially given the widespread under-declaration of subs numbers by the last-mile operators, which do not want to pay carriage fees to the MSOs.

There are 72 million cable subscribers to the 60,000 local cable operators. Many cable operators take their content from the 5,000 MSOs. The top 10 MSOs serve half the cable subs. The three top MSOs (In Cablenet, Hathway and Datacom and Wire and Wireless) had 14 million subs at end-2010, or 20% of cable subs. Wire and Wireless India, a subsidiary of Zee Entertainment Enterprises, had 2.5 million cable TV households across 54 cities by March 2011. In Cablenet, owned by the Hinduja Group, served 7.5 million households by end-2010. With 4.3 million subscribers by end-2009, Hathway Cable & Datacom is 64% owned by the Rajan Raheja Group, 22% by Star TV and 14% by ChrysCapital. Hathway had 8.2 analog cable subs and 1.3 million digital ones at March 2010.

IPTV has not made much impact due to low bandwidth and limited PC penetration. Furthermore, the lack of compulsory local loop unbundling means that any IPTV aspirants must construct their own networks. Network monopolists BSNL (30,000 IPTV subs) and MTNL (20,000 IPTV subs from its 1.6 million broadband homes) offer IPTV, but take-up has been adversely affected by the cheaper analog cable offers. BSNL wants 16 million broadband subs by March 2014. Reliance launched its IPTV service in Delhi and Mumbai in August 2010. The company had 181,000 broadband subs by end-2010. Bharti had 1.4 million at the same time.

DTT is not a priority in this poor country. However, DVB-T2 tenders for the transmission network were offered in August 2010.


Indonesia digital TV briefing

Despite much potential, Indonesian pay TV is underdeveloped. Pay TV penetration is low, partly due to the multitude of FTA terrestrial channels on offer and partly due to the low disposable income for most homes. Legitimate pay TV subscriptions reached 1.2 million of the 41 million TV households at end-2010. There were only 180,000 cable subs at end-2010, with nearly all of the rest taking DTH services.

Piracy remains a major problem, with up to 2 million homes receiving illegal signals.

Mediacom Sky Vision (trading as Indovision and Top TV) accounts for about 80% the legitimate pay TV subs, with 805,000 DTH subs at end-2010. Global Mediacom owns 75% of the company and also owns several major FTA broadcasters. Indovision will have an IPO soon.

Lippo Group-owned First Media had 140,000 cable subs by end-2010. The Lippo Group put the company up for sale in January 2011.

TelkomVision, trading as Yes TV and a subsidiary of Telkom, had 213,000 DTH (mainly pre-paid) and cable subscribers at end-2010. The cable total was about 30,000, with little investment expected in this network. After several delays, Telkom will launch an IPTV platform in 2011. Telkom had 1.6 million broadband subs by end-2010.

Aora TV and Skynindo provide smaller DTH platforms.

National analog terrestrial switch-off is scheduled for 2018, though only DVB-T trials have taken place so far.


Japan digital TV briefing

The natural and nuclear disasters have rocked Japan. These disasters follow years of economic stagnation.

The plethora of free-to-air content and heavy-handed regulation are stifling pay TV take-up.

The Ministry of Internal Affairs and Communications estimated 24.71 million cable subscribers (to operators producing their own broadcasts) at March 2010, or 44% household penetration. Most cable subs pay a low fee to receive only the major terrestrial channels. Only 5.55 million subscribe to premium services. A further 8.27 million households receive rebroadcast cable services from operators that act solely as retransmitters.

Telco KDDI acquired a stake in leading MSO J:Com from Liberty Global in February 2010 for ¥362 billion. Sumitomo now owns 40.0% of J:Com, with KDDI taking 29.3%. J:Com recorded 2.72 million digital cable TV subscribers by March 2011, of which about 30% took triple-play services. J:Com’s HD DVR had 582,000 subs by March 2011, compared with 510,300 subs a year earlier. In 2010, 9.5 million on-demand purchases were made, compared with 8.4 million a year earlier.

Also owned by KDDI, Japan Cable Net had 1.09 million subscribers by March 2011. KDDI wants 2.4 million FTTH subs by March 2012, up from 1.9 million a year earlier. The company also has 0.83 million DSL subs (total is falling).

Fiber-to-the-home overtook DSL as the leading broadband technology by subs in mid-2008. There were 19.77 million FTTH homes and 8.59 million DSL ones by end-2010. NTT had 15.06 million FTTH subs at March 2011 and wants 17.16 million by March 2012. The company had 2.01 million TV subs by March 2011, up from 1.28 million a year earlier. It wants 2.83 million TV subs by March 2012.

IPTV is gaining traction for the five operators, though there were still only 1.7 million subs by end-2010. Growth has been helped by the government relaxing rules that banned terrestrial channels on IPTV.

DTH is split between Broadcasting Satellites (BS), which only carry broadcast services, and Communications Satellites (CS), which carry both telecoms and broadcast services.

Sky Perfect Communications has a flat subscriber base, and has lost its position as top pay TV operator to J:Com. Sky Perfect recorded 3.74 million subscribers across all of its platforms by April 2011, of which 2.19 million were CS subs. The company also controls the Hikari PerfecTV IPTV service, which had 111,000 subscribers at April 2011. Sky had 438,000 HD subscribers at


the same time. It wants all subscribers to take HD by March 2014. The company also wants 4 million subs by March 2015.

The BS DTH platform will expand after analog switch-off, with eight to 12 new channels added to the existing 12. There were 18.01 million BS homes by December 2010. BS Digital carries channels from NHK, Wowow, Star Channel and the five major commercial broadcasters.

Analog switch-off across all platforms was set for July 2011, but it will be delayed by a year due to the disasters. Using ISDB-T standard, the government’s target was 50 million digital-ready homes and 100 million DTT-enabled devices shipped by April 2011.


Malaysia digital TV briefing

Malaysia is experiencing rare competition as the pay TV monopoly moves into broadband provision and as the incumbent telco offers TV services.

DTH platform Astro had 2.93 million subscribers in January 2010, or nearly all of Malaysia’s pay TV subs and half the 5.99 million TV households. No later figures have been released as Astro delisted in June 2010. Astro controls most of the premium content, thus limiting any competition. In December 2009, Astro launched its B.yond IPTV service, which had more than 500,000 of Astro’s total subs by March 2011, with uptake helped by its free equipment and installation offer. In December 2010, Astro extended its IPTV reach by signing a collaboration deal to deliver the service on TIME’s fiber network. Astro also wants to launch on DTT.

Telekom Malaysia launched its Hypp.TV IPTV service in March 2010 as part of a triple-play bundle. Offering some linear channels, the service requires 8Mbps. Telekom Malayisa had 1.39 million residential broadband subs at end-2010. Malaysia had 1.51 million DSL subs at end-2010, up from 1.29 million a year earlier.

Mobile operator Maxis is reported to want to launch an IPTV service by using TM’s high-speed broadband network.

Malaysia has no cable TV services.

Public broadcaster RTM launched a DVB-T standard DTT platform in 1Q10, including some channels from Astro. A DVB-T2 trial took place in March 2011. National DTT coverage is expected by 2012 when 19 channels will be on offer. Analog switch-off is set for 2015.


New Zealand digital TV briefing

About 72% of the 1.64 million TV households were digital by January 2011. Of this total, 62% only took a pay TV service from Sky or TelstraClear, 12% subscribed to a pay TV service and had DTT, and 26% were DTT only.

By controlling most premium content rights, Sky accounts for more than 90% of pay TV subs. Sky had 660,000 direct residential DTH subscribers at December 2010 – or 40% of TV households. However, the number of direct subs seems to have peaked, so the company has formed partnerships with cable and IPTV operators to re-distribute its packages. FTA DTH and DTT are its greatest threats. The company also wants to increase ARPU from existing subs, especially through its MySky HDi service that had 231,072 subs at December 2010. In 2010, churn for MySky subs was only 9.5% compared with 15.0% for non-MySky subs. News Corp.-owned Nationwide News holds a 43.65% stake in Sky.

Freeview launched FTA DTT and DTH services. Freeview reached 419,945 homes by June 2010 (26.1% household penetration), up from 255,048 a year earlier. About 55% of Freeview homes took the DTH service, with the rest being DTT. Freeview’s DTH platform started in May 2007, followed by the 15-channel DTT service in April 2008. TVNZ may add pay services to Freeview.

TelstraClear began testing a cable/IPTV hybrid service in Wellington in late 2009. The IPTV service started in September 2010. TelstraClear is transferring its cable subs to digital.

TCNZ has upgraded its DSL network to carry on-demand programs (but no linear channels). TCNZ also offers subscribers a Freeview-compatible Tivo box. The company’s fiber-to-the-node network will be completed by end-2011. TCNZ had 587,000 retail broadband subs by end-2010.

Using the DVB-T standard, analog terrestrial switch-off is due to start on a regional basis in September 2012 and will be completed by November 2013. HD DTT coverage will extend from 75% to 86% of the population by September 2011 (when the Rugby World Cup starts in New Zealand). There were 300,000 DTT homes at end-2010, up from 156,408 a year earlier.


Pakistan digital TV briefing

More than half the 18 million TV households receive multichannel signals. More than 7.5 million more homes do not own a TV set.

Piracy remains a big problem. CASBAA estimated that piracy hit the legitimate sector for US$63 million in lost revenues in 2010.

Of the 10.5 million multichannel homes, 8.5 million receive cable and MMDS signals from more than 2,300 operators. The government wants all of these operators to convert to digital by 2015. Cable and MMDS ARPU is only PKR200.

The remaining 2 million multichannel homes have satellite dishes. However, an increasing number of homes are illegally importing dishes from India to receive those channels and packages. India’s Reliance has expressed an interest in establishing operations in Pakistan. In late 2010, Russia-based General Satellite Company was reported to be interested in establishing a DTH platform for Pakistan. Several Pakistani channels have already gained distribution via AsiaSat.

Pakistan has adopted the DVB-T standard for DTT, though not much progress has been made.


Philippines digital TV briefing

Only about 5% of the 13.7 million TV households receive digital signals. Cable overbuilding is allowed, deterring operators from upgrading to more expensive digital networks. Widespread poverty is another drawback.

Sluggish regulatory change is holding back pay TV.

Piracy remains a big problem, with about 1.5 million homes receiving illegal cable signals and a similar number taking legal ones from 700 operators. CASBAA estimates monthly cable ARPU of PHP250-300, though rates in Manila are three times as high.

About a fifth of SkyCable’s 550,000 subscribers take digital services. Sky offers subs a pre-paid option. Sky Cable is owned by FTA broadcaster ABS-CBN.

There are three DTH operators, though they have had a limited impact. The Dream DTH platform had 47,000 subs at end-2010. Launched in July 2009, Cignal Digital TV claimed 120,000 subs at end-2010, up from 45,000 subs a year earlier. The company wants to double its subs base by end-2012. Cignal is owned by PLDT’s subsidiary MediaQuest Holdings. Launched in 2008 and owned by Samoa-based Global Broadcasting and Multimedia, the G-Sat DTH platform has some exclusive sports rights.

IPTV is held back by low broadband penetration and slow access speeds. The Philippines Long Distance Telephone Company (PLDT) controls 63% of DSL subs – or about 671,588 subscribers by March 2011. PLDT is constructing a next-generation network.

The National Telecommunications Commission is targeting analog switch-off by end-2020, delayed from its initial target of 2015. More details will be released in June 2011, but operations are expected to start in the major cities in 2012. The Philippines will use the ISDB-T standard, though there were some moves in May 2011 to switch to the DVB-T2 standard.


Singapore digital TV briefing

About 68% of Singapore’s 1.18 million TV households subscribe to pay TV services.

StarHub Cable Vision is the pay TV market leader, though subscriber growth is flat and TV ARPU is falling. All of its 542,000 cable subs are digital. The Hubstation DVR had 790,000 sales by end-2010. By March 2011, there were 203,000 triple-play subs and 239,000 double-play ones. About 56% of subs took at least two services by 1Q11.

StarHub lost the rights to broadcast English Premier League soccer via ESPN Star Sports to SingTel - for three seasons from 2010. In October 2010, the Media Development Authority demanded that content should be available across all platforms. However, this decision is being disputed.

Competition comes from Mio TV, SingTel’s IPTV service, which had 292,000 subs (of which 241,000 take bundles) at March 2011, up from 155,000 a year earlier. Mio offers a la carte channel selection as well as subscriptions. Mio TV started 3D broadcasts (of an EPL match) in April 2011. Singapore had 564,800 DSL subs by February 2011. Alternative telco launched the M1 IPTV service in November 2010.

Telcoms regulator IDA awarded the license for the Next Generation National Broadband Network to the OpenNet consortium, which includes SingTel and Singapore Press Holdings. The project will eventually give all homes access to speeds of 1Gbps. By end-2010, 60% of households had access, with a 95% target by mid-2012.

Residential satellite dishes are banned in Singapore.

DTT has launched using the DVB-T standard, with analog switch-off not expected before 2017. About half the TV households receive DTT signals. An HD DTT channel from public broadcaster MediaCorp launched in November 2007.


South Korea digital TV briefing

Nearly all of the 16.81 million TV households pay for TV signals, but only half receive digital channels. Multichannel penetration is high, with many homes taking more than one pay TV service.

The Korean Communications Commission awarded three full IPTV licenses (allowing operators to carry linear channels) in November 2008, thus increasing pay TV competition. About 3.58 million IPTV subs (both linear and VOD-only) were recorded by end-2010 when Korea had 17.22 million broadband subs.

Korea Telecom-owned Qook TV had 2.09 million real-time and VOD-only subscribers by end-2010, of which 1.40 million were live (linear). KT had 7.42 million broadband subs by end-2010. Qook TV had 600,000 hybrid subs with DTH SkyLife at end-2010. KT also owns a stake in SkyLife.

SK Broadband’s Broad&TV had 912,133 subscribers by March 2011, with 731,573 subscribing to full IPTV. The company wants 3 million IPTV subscribers in end-2011. LG Telecom had about 350,000 IPTV subs by end-2010.

The cable operators are not happy that their IPTV counterparts can carry linear channels. Furthermore, they can offer national services whereas the MSOs have limits on the number of geographic franchises that they can own. However, the cable operators still have exclusive carriage of 40 channels.

Cable operators have benefited from the relaxation of foreign ownership rules in 2007. C&M Communications was bought by Australia-based Macquarie Bank and local private equity firm MBK Partners for US$2 billion.

With low subscription fees and slow reactions to competition, cable penetration has reached saturation point. Only 3.46 million of the 15.3 million cable subscribers had converted to digital by end-2010, though this was up from 2.75 million a year earlier. KISDI forecasts 4.37 million digital cable subs by end-2011, but also predicts that total cable subs numbers will fall. The Korea Cable TV Association optimistically predicts 70% digital penetration of cable networks by 2012 when it expects 150 HD channels to be available. The top three cable operators (CJ HelloVision, C&M Communications and T-Broad) account for most of the digital cable subs.

With 2.9 million subscribers, sole DTH operator SkyLife is adding subs mainly through SMATV provision and by providing hybrid services to the IPTV operators. About a quarter of subs pay for the HD channels. Korea Telecom owns a 46% stake in SkyLife, having increased it from 22.5% in January 2011.


The government is encouraging local consumer electronics companies to invest in 3D TV. SkyLife launched the world’s first dedicated 24-hour 3D channel in January 2010. IPTV operators Qook TV (part of Korea Telecom), Broad&TV (a division of SK Broadband) and LG Telecom are all preparing 3D TV trials.

Slow DTT adoption led to the government to delay its end-2010 target for

95% coverage. Using the ATSC standard, analog switch-off is now scheduled

for end-2012. Fewer than 10% of homes are terrestrial only.


Sri Lanka digital TV briefing

About 70% of the 4.7 million households have a TV set.

Pay TV leader Dialog TV, which also operates the DTT platform, had 168,000 DTH subscribers by end-2010, up 13% year-on-year.

Sri Lanka Telecom launched the Peo TV IPTV service (also known as SLT Visioncom) in September 2008. Take-up has been slow, with only 26,569 subs at end-2010, up 23% from 15,000 a year earlier. The company had 213,816 DSL subs at end-2010. SLT offers quad-play services.

Lanka Broadband Networks provides digital cable TV services.

MMDS network Comet Cable (also known as Multivision) has 10,000 subscribers in Colombo.

Sri Lankans can access Indian DTH platforms by acquiring dishes from SATnet.

Using the DVB-T2 standard, DTT rollout with nine channels will start in 2011. The Ministry of Mass Media and Information wants national analog switch-off by end-2017.


Taiwan digital TV briefing

Pay TV penetration has reached 76% of the 7.78 million TV households, though digital cable TV penetration is low at only 5% of the 5.08 million total cable TV subs.

The regulator wants all cable TV to be digital by 2013. However, homes are used to paying little for analog signals. The National Communications Commission sets limits on subscriber fees, much to the annoyance of the cable operators that are trying to upgrade subs to digital. Furthermore, most popular cable channels are reluctant to move exclusively from the basic analog package to the digital tier as lower audiences would hurt their ad revenues. Kbro, China Network Systems and Taiwan Broadband account 60% of cable TV subs, with the remaining 60 operators taking the rest. The major operators are upgrading their networks to DOCSIS 3.0

Kbro, owned by Taiwan Mobile (which acquired Kbro from the Carlyle Group in December 2010), is the pay TV leader, with 1.1 million cable subs, though only 570,000 are considered pay TV subs. This brings it close to the 33% limit on total subscribers for any one company. The company offers quadruple-play services.

China Network Systems, 60% owned by Hong Kong-based MBK Partners and 40% by the Koos Group, has 1 million cable TV subscribers. MBK is in the process of selling its stake to Want Want China Holdings.

Owned by Australia’s Macquarie Bank, Taiwan Broadband Communications has 720,000 cable subscribers.

CHT’s Multimedia-on-Demand IPTV service (aka Big TV) reached 834,000 subs in March 2011, up from 665,000 a year earlier. The company wants 1 million IPTV subs by end-2011. Chunghwa Telecom (CHT) wants to migrate its 4.4 million broadband subs to its FTTx network, and reached the halfway point by March 2011. Many IPTV homes also have cable subscriptions. CHT offers fast broadband and VOD, whereas channel choice is greater on cable. CHT cannot offer linear channels, though it can lease capacity to third-parties. CHT does not carry several of the top cable channels.

Taiwan had 5.31 million fixed broadband subs at end-2010, of which 2.36 million were DSL, 1.96 million FTTx and 0.93 million cable.


There is no DTH platform.

Having adopted the DVB-T standard, analog terrestrial switch-off is

scheduled for 2013. The government will give subsidies to 100,000 low

income households. All new sets sold must have an integrated DTT receiver.

Standard definition signals started in 2004, with HD DTT beginning in May

2008.


Thailand digital TV briefing

About 40% of Thailand’s 18 million TV households receive multichannel signals, with most taking FTA DTH signals. Thailand is adding 1 million new DTH subs each year.

Piracy is a major problem, with up to 2 million homes receiving illegal signals. CASBAA estimated lost revenues to piracy at US$241 million in 2010.

True Corporation had 1.71 million legitimate subscribers to its cable TV, DTH and IPTV services by end-2010. About 93% took TrueVisions’ DTH service. About 930,000 subs paid for DTH services by end-2010, including 455,000 to the premium service. However, 520,000 took the Freeview service that is available exclusively to True’s mobile subs and a further 256,000 were FTA DTH homes. The cable and IPTV base is very low, though the company is expanding its DSL and DOCSIS 3.0 networks. The operator offers pay TV as part of triple- and quadruple-play deals.

About 5 million homes take satellite signals, with most taking FTA channels. According to AGB Nielsen, FTA DTH penetration was 22% at end-2010, and will reach 28% by end-2011. The growth of FTA forced TrueVisions to offer free channels and cheap packages, so its TV ARPU is falling.

Offering 40 channels and launched in mid-2007, Thaicom-owned FTA DTH platform DTV Service was available in 1 million homes by March 2011, up 51% year-on-year.

With 2.5 million subs at present, the Thailand Cable TV Association expects 10 million legitimate cable subs by 2018.

IPTV take-up is limited due to low fixed-line penetration outside Bangkok. True and Advanced Datanetwork Communications each have about 10,000 IPTV subs.

The National Broadcasting and Telecommunications Commission super-regulator was created in December 2010, but will not start operations until 2012.

Few concrete DTT plans have been announced, though Thailand adopted the DVB-T2 standard. A trial started in January 2011. Analog switch-off is ambitiously set for 2015.


Vietnam digital TV briefing

Of Vietnam’s 22 million homes, 19 million have a TV set. There are about 3 million legitimate pay TV households, with similar number of illegal ones.

Piracy is a major problem.

The government dominates the TV sector.

The Directorate of Broadcasting and Electronic Information estimated 2.6 million cable TV subscribers at end-2010. The government wants all cable networks to be fully digital by 2020. It wants all cities and provincial capitals to have cable TV access by 2015. Saigon Cable TV has 300,000 subscribers, and VCTV has about 500,000.

K+, a joint venture between France’s Canal Plus (49%) and VTV (51%), launched as a premium DTH platform in June 2009. VTV has about 100,000 subs to its basic package. VTC launched a rival DTH platform in July 2010. Vietnam has about 500,000 FTA and pay DTH homes.

FPT (iTV), VNPT (MyTV) and VTC all offer IPTV services, though the total is less than 100,000 subs. Vietnam has about 6 million broadband subs.

DTT is making an impact, with 2.5 million households. VTC offers 18 channels. National analog terrestrial switch-off is scheduled for 2015. The DVB-T standard has been adopted, with DVB-T2 to be introduced in 2012.

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