MBA Exclusive: A Wider Search For Future Growth
Opportunistic bets on Asia’s video ecosystem this week from Fox, Turner and TVB.
Market announcements from three large-scale TV groups show an industry still willing to take punts – part opportunistic, part hedged, but arguably not too defensive – to create new demand across Asia’s TV and video ecosystem.
Fox International Channels (FIC), an established aggregator and curator of pay channels, is banking on the success of a self-produced Chinese mini-series to pave the way to scale up similar endeavours across the region.
Hong Kong market leader Television Broadcasts (TVB) is working on a revamp of its OTT video offering, as the free TV incumbent strives to leverage its dramas and entertainment shows beyond traditional distribution platforms, and also potentially enter new partnerships.
Finally, Turner Broadcasting has generated equal measures of surprise, indignation and interest in the factual space after announcing its own offering, World Heritage Channel.
"For all three, much will depend on the quality of the end product as well as achieving scale economics in the creation and distribution of the content, especially in the case of Fox and Turner,” says Vivek Couto, director at industry consultants Media Partners Asia (MPA).
FIC’s venture – focused on creating premium Asian entertainment across theatrical and pay windows – needs enough box-office buzz as well as returns to translate into audiences and revenues across pay channels and digital platforms, ensuring the initiative becomes a long-term strategy across other segments and multiple markets.
The broadcaster has also been investing in local movies, including recent hit Sara (pictured).
Turner, on the other hand, is looking to capitalize on demand from pay-TV platforms for pure-play factual content while going up against incumbents with large-scale libraries, who are also investing heavily in original productions.
TVB, meanwhile, will need to drive volume and scale across its expanded OTT platform amidst competition from PCCW Media, and as management look to accelerate revenue generation across a Hong Kong digital business generating US$25 million a year.
We examine each of these bids in more detail.
FIC'S Asian Mini-Series
Premium Asian content remains largely underdeveloped in much of the region, and is likely to drive the next wave of consumer expenditure and distributor investment.
In recent years, much of the pricing power and consumer demand has focused around Korean content, but operators these days are less keen to pay for more Korean fare.
Chinese content, however, is another matter.
At this week’s Hong Kong Filmart, Fox SVP Cora Yim unveiled plans for Guilty as Sin, a 6-8 episode miniseries costing about US$0.5-1 million an episode, with the pilot released at the box office to generate marketing and revenue momentum for the franchise.
Cinematic exposure also helps attract talent, in a bid to mirror Hollywood-type production values.
Thereafter, the show will make its way onto Star Chinese Movies, a successful Chinese pay channel owned by FIC which is popular in Taiwan, Hong Kong and Singapore. Thereafter, monetization is likely to occur through syndication to OTT and other video platforms across key markets.
Success will also act as a catalyst to turbocharge similar projects in Southeast Asia, using both local and Chinese talent.
TVB Ramps Up OTT
OTT competition is heating up in Hong Kong, where local pay-TV leader PCCW recently moved to take a controlling stake in mobile VOD platform, Vuclip, to spearhead regional expansion, while also readying plans to expand the scale and scope of its OTT platforms in Hong Kong.
Now, free-to-air leader TVB has announced that it has 25,500 hours of content – including 1,700 hours worth of acquired dramas from Japan, Korea, Taiwan and China, in addition to 17,700 hours of its own – for a new OTT offering to go live early in 2016.
Local telecoms company Hutchison, which also holds a long-term contract to help distribute pay-TV service TVB Network Vision, has been enlisted to help with sales and distribution, although TVB’s OTT offering will be available on other networks in Hong Kong, and may extend its reach in time overseas.
The move could also indicate a greater urgency to monetize a paid window for TVB content. The new service will include pay channels that are currently available on PCCW’s IPTV platform, Now TV, as well as via TVB Network Vision, which was given an overhaul last year to reignite growth.
TURNER's Factual Play
A factual channel helps round out an Asian portfolio for Turner, largely anchored to the pay-TV window, that also includes a recently revamped English entertainment offering, Warner TV, and a six-month-old Korean drama channel Oh!K, in addition to an increasingly expansive suite of news and kids services anchored around CNN and Cartoon Network.
For World Heritage Channel, designed to offset the factual genre’s drift towards entertainment with a heavy documentary focus, Turner needs to deliver a product that distributors want to carry at reasonable rates, building enough reach and audience over time for Turner to attract regional and local advertisers.
Unlike its rivals however, Turner has no library it can fall back on, relying on acquired content until the channel reaches enough momentum and scale to consider original production, potentially in partnership with local pay-TV operators.