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Digital Reinvention

Asia Pay-TV Disruption Takes Shape

The need for traditional pay-TV platforms to reinvent themselves across Asia-Pacific is becoming more pressing than ever. Larger APAC markets – Australia, China, India, Japan and Korea – are all grappling with platform transformation, anchored to cable digitalization and OTT competition.

In Southeast Asia meanwhile, pay-TV subscriber growth is flattening out in Indonesia, Malaysia and Thailand, key growth economies, as well as Singapore, focusing operator minds on Arpu and churn instead.

In the Philippines and Vietnam, where the overall pay-TV base continues to expand as DTH platforms sign up more rural customers, cable networks are also hitting the ceiling in subscriber growth, as urban areas become increasingly saturated.

It’s a strong case for a fresh approach to pricing, product and packaging, and potentially ownership too, articulated in this year’s Asia Pacific Pay-TV & Broadband Markets report, the annual review of the competitive landscape from Media Partners Asia (MPA).

It’s a journey many leading pay-TV networks have already embarked on, MPA analysts note, as competition from both free and illegal alternatives intensifies.

Rising fixed broadband penetration is applying pressure on premium packs and tiers and, in a foretaste of bigger disruption ahead, is already undermining the business case for English-language general entertainment channels.

As mobile broadband becomes increasingly affordable and accessible, OTT will make an even greater impact on industry business models, for free and pay-TV.

At the same time, free TV remains popular and in some cases is becoming even stronger, reaping the benefits of large or still fast-growing ad markets.

In many markets, these economics ensure that premium local content – which can help drive the next cycle of pay-TV growth – stays on free-to-air channels, at least for now.

Even countries where pay-TV platforms are big investors in local content, such as India, Malaysia and Thailand, are also seeing healthy concurrent growth in free satellite viewing, even though the prognosis for pay-TV is markedly different in all three markets.

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