Speaking about TV, I had a very interesting lecture about the (quick) history of television broadcasting in Indonesia.
It was an event held by one of our customer. Since we were one of the speaker, we also had a chance to attend the whole session.
Until 1988, television was a controlled media in Indonesia. There was only once channel TVRI. Government owned national broadcasting. Although they permitted at one time, No TV ads were allowed, due to the fear of “consumptivism” as the result of these ad.
(There was an annectdote that our former President found out that a rural farmer bought a fridge, though he doesn’t have electricity, and used it as clothing cabinet; only because he saw an ad about it on TV. Since then ad was banned).
Imagine how’s life with only one channel….
Then in 1989 RCTI started as a (terrestrial) pay TV station, broadcasting 100% Hollywood content. With decoder. Covering Jakarta and surroundings. The subscriber number maxed at around 125k when they licensed EPL live.
Then regulation changed in 1991 and they allowed FTA license. In 1993, five licenses were granted: RCTI, SCTV, Indosiar, TPI, and ANTV. (Those who live long enough here knew why these 5.)
Business model was ad-funded, as with all FTA.
And the rest 20-year is history.
Ad industry now is valued at around US$5 bio. About 60% goes to the TV.
There are now 10 National FTA TV, plus 1 TVRI, 200+ local TV, 3 Pay TV (and one upcoming IPTV). All competing for the same 43mio households.
Content has shifted from imported movies to more local (or locally adapted) shows. Quality is another issue ya… Sports is always an exception.
Content production houses thus have flourished as well.
It is one of the most cut throat FTA market in Asia.
So the question now is where the industry is going?
Digital Terestrial TV transition (DVB-T) in 2013/2017 will change the industry structure as well. There will be network companies and content companies.
Noting that, digital dividend will gradually become available soon.
And then another question, if there’s a good future for Pay TV and IPTV and Mobile (pay) TV. (There’s a future predicted at 14% revenue growth by MPA, but definitely not easy).
How are Pay TV’s going to grow their revenue? Worldwide statistics show that subs revenue is around 45%, the rest is ads.
But I’m used to (and still expect) ad-free channels at my Pay TV. I saw the growth of Pay TV ads nowadays.
How about these interactivity features boasted by IPTV (and to some extend fixed-line based return channel for Sat TV)? Has anyone successfully implemented these?
Still IPTV and the overall industry will have have challenges from the OTT (Internet TV) and social media channel (“Social Entertainment”). How will they react?
Note also that IPTV initiatives by Telco are only considered successful in Hongkong and France. Overall IPTV subs worldwide accounts for 30mil household (SNL Kagan, E’09). Asia alone has 650mil TV households.
To be frank, I have more questions than answers at this moment…
Definitely an interesting era to be in. The convergence (read: collission) of media, telco, and Internet.
At the end… Long live the customer. More choices, more convenience, but more complications.
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