01-Sep-05
The four bright stars in Asia's pay television industry.

Singapore, September 01, 2005 - Asia-Pacific's pay television subscribers numbered 205 million at the end of 2004, according to Fusion Consulting estimates. Over 90% of this market resides in just four countries: Japan, Korea, China and India.

While Japan, India and China are the undisputed regional heavyweights, accounting for 65% of the region's US$25 billion revenue and 85% of the subscribers, they are each at a different stage of development.

Japan has a relatively large subscriber base of almost 20 million, but what makes it really interesting is its average revenue per subscriber household (ARPH), estimated at around US$600. This is many times more than the average Indian subscriber household, especially given the twin problems of subscriber reporting and revenue collection plaguing the Indian industry.

Dubbed by many industry insiders the "most exciting" in the region, growth in the Indian market is easily outpacing that in China and Japan. Growing at a projected compound annual growth rate of close to 10%, India's pay TV subscriber households are expected to approach 70 million by 2010, up from 50 million at the end of 2004. The market continues to attract operators, programmers and distributors, despite chaotic infrastructure and confusing regulations.

Vying with India for the "most exciting" title is China, where a huge market of over 100 million subscribers has already been established by domestic operations. This continues to grow at a rate of a few percentage points a year, as urban incomes increase. The real excitement so far however for all but a select few international players is very much in the future potential, as most foreign players are currently unable to broadcast their own dedicated channel.

An apparent clamp-down by the Chinese government on foreign companies' investments in the media business in mid-2005 seemed to quell the excitement at least temporarily, but as one source at an international programmer recently put it, "there is a public side and a private side to China's policy on foreign involvement in the media industry". So don't expect a hiatus in foreign programmers' investments into China anytime soon. And there does not seem to be any lack of appetite within China for foreign entrants. Joint ventures continue to flourish, most notably with Shanghai Media Group (SMG), which has teamed up with several foreign programmers over the past several years.

Content localisation has been a key driver of the recent upturn in the fortunes of cable and satellite players in Asia. The most obvious example of that phenomenon is the case of the Asian bellwether programmer STAR TV, owned by News Corp., which has developed and delivered several quality local channels for the Indian market. The local Indian content, notably the STAR Plus channel, was a big contributor to the company's shift into the black in 2003, following a ten year period of negative returns.

Localisation can work in other ways too. Numbering over 11 million people and 2.8 million households, the population of expatriate overseas South Asians around the world equates to that of a small country, with average incomes many times those earned on the sub-continent. Programmers like STAR, Zee and Sony have tapped this market successfully with Hindi, Bengali and Tamil language content, and Fusion Consulting now estimates it to be worth about US$400 million in advertising and subscription revenues.

China's Shanghai Media Group has announced its intention to follow in the footsteps of the Indian programmers, by creating and broadcasting programs aimed at overseas Chinese. With over 30 million ethnic Chinese living outside China, Taiwan and Hong Kong, earning incomes way above the Mainland average, this is a market that potentially holds returns even greater than those of the overseas South Asian market.

As the Asia Pacific pay-TV market continues to develop, and more domestic and international opportunities open up for both Western and Asian players, the prospects for the industry look brighter than ever.

About Fusion Consulting
Fusion Consulting is a business intelligence consultancy providing clear strategic advice on Asia-Pacific markets. With offices in Singapore, Shanghai and Hong Kong and a network of 400 industry-specialist consultants in 16 countries, the company conducts custom research and consulting to help companies understand their markets, compete more effectively and grow into new areas of opportunity.

For more information, please contact Fusion Consulting at

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