Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia...

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Asia Pacific Pay TV Operators Summit April 23, 2013

Transcript of Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia...

Page 1: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

Asia Pacific Pay TV Operators Summit April 23, 2013

Page 2: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

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Robust but lower subscriber growth in 2012 across Asia’s pay-TV industries

Total Pay-TV Subs, 2011 vs 2012 2012 Net Pay-TV Subs (excl. China): 13.4 mil.

413

198

444

211

0

50

100

150

200

250

300

350

400

450

500

APAC APAC (excl. China)

Su

bs

(mil.

)

2011 2012

Australasia, 0.4%

South Asia, 52%

North Asia (excl. China), 22%

Southeast Asia, 26%

Page 3: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

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Pay-TV penetration will approach 70% by 2020

APAC Pay-TV Subs and Penetration, 2004-2020

98 109 119 131 147 165 182 198 211 224 237 252 264 275 284 291 297 116 128 141 152 163 179

195 215

233 246 256 266 342 356 370 384 398

0%

10%

20%

30%

40%

50%

60%

70%

80%

0

100

200

300

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2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

% P

enetration

S

ub

s (m

il.)

China APAC excl. China % APAC Pen/TVHH % APAC Pen./TVHH excl. China

214 237

260 283 310

344 377

413 444

470 493

517

606 631 654 675 696

Page 4: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

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New additions will peak in 2015

APAC (excl. China) Net Subs Adds, 2004-2020

0

2

4

6

8

10

12

14

16

18

20

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Net

New

Ad

ds

(mil.

)

India Australasia North Asia (excl. China) South Asia (excl. India) Southeast Asia

11.0 11.3 10.2

12.4

15.5

17.8 17.0

16.0

13.4 12.7

13.4 14.3

12.7

10.6

8.8

7.4 6.5

Page 5: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

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Growth is increasingly robust in SEA but India dominates the regional landscape

APAC excl. China & India, % Share of Net Subs Adds, 2012 vs 2013

APAC excl. China, % Share of Net Subs Adds, 2012 vs 2013

Total: 13.4 mil. Total: 12.7 mil. Total: 7.7 mil. Total: 5.8 mil.

26% 15% 18%

9%

8% 8%

22%

22% 17%

0.4%

1% 1%

43% 54% 56%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2012 2013 2014

India Australasia N. Asia (excl. China) S. Asia (excl. India) Southeast Asia

Total: 13.4 mil.

45% 33%

40%

15%

18% 18%

39% 47% 39%

1% 2% 3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2012 2013 2014

Australasia N. Asia (excl. China) S. Asia (excl. India) Southeast Asia

Total: 5.9 mil.

Page 6: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

India, 63% Southeast Asia, 16%

North Asia (excl. China), 12%

South Asia

(excl. India),

8%

Australasia, 1%

6

Subscriber volume will remain driven by India and Southeast Asia

2012-2020 Cumulative Net Subs Adds, APAC (excl. China): 86.3 mil.

Key Markets: Korea: 8% Japan: 3%

Key Markets: Indonesia: 7% Vietnam: 4%

Page 7: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

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DTV transition in China and India will help drive digital penetration

10 13 16 21 32 45 60 75 97 118 139 160 178 194 206 219 228

1 4 12 28 49

67 96

126 161

191 220

246

326 345

363 381 398

0%

10%

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30%

40%

50%

60%

70%

80%

90%

100%

0

100

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600

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2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

% P

enetration

D

igit

al S

ub

s (m

il.)

China APAC excl. China % APAC Digital Pen/TVHH % APAC Digital Pen./Pay-TV Subs

APAC Digital Pay-TV Subs and Penetration, 2004-2020

11 17 28 49

81 112

156 200

258 309

359 406

504

539 569

600 626

Page 8: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

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Affordability and competition helps drives pay-TV adoption

Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012)

Australia

China

Hong Kong India

Indonesia

Japan

Korea

Malaysia New Zealand Pakistan

Philippines

Singapore

Sri Lanka

Taiwan

Thailand Vietnam

USA

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0.0% 0.2% 0.4% 0.6% 0.8% 1.0% 1.2%

% P

ay-T

V P

en./

TVH

H

Pay-TV ARPU as a % of PPP-adjusted GDP per household

Page 9: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

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Growing competition, higher incomes and economic will boost future adoption

Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2020)

Australia

China

Hong Kong India

Indonesia

Japan

Korea

Malaysia New Zealand Pakistan

Philippines

Singapore

Sri Lanka

Taiwan

Thailand Vietnam

USA

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0.0% 0.2% 0.4% 0.6% 0.8% 1.0% 1.2%

% P

ay-T

V P

en./

TVH

H

Pay-TV ARPU as a % of PPP-adjusted GDP per household

Page 10: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

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Value creation across Asia’s pay-TV markets: (2012)

Subscription Revenue Volume Size (The Big Markets), 2012

Australia

China

India

Japan Korea

Taiwan

(100)

0

100

200

300

400

500

(20) 0 20 40 60 80 100 120

Tota

l Su

bs

(mil.

)

ARPU (US$)

Subscription Revenue Volume Size (Emerging Markets), 2012

Hong Kong

Indonesia

Malaysia

Philippines Singapore

Thailand

Vietnam

(2)

0

2

4

6

8

10

12

0 10 20 30 40 50

Tota

l Su

bs

(mil.

) ARPU (US$)

Page 11: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

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Focus will be increasingly on value creation (2020)

Australia

China

India

Japan Korea

Taiwan

(100)

0

100

200

300

400

500

(20) 0 20 40 60 80 100 120

Tota

l Su

bs

(mil.

)

ARPU (US$)

Subscription Revenue Volume Size (The Small Markets), 2020

Subscription Revenue Volume Size (The Big Markets), 2020

Hong Kong

Indonesia

Malaysia

Philippines

Singapore

Thailand

Vietnam

(2)

0

2

4

6

8

10

12

0 10 20 30 40 50

Tota

l Su

bs

(mil.

) ARPU (US$)

Page 12: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

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Quantifying revenue contributions across pay-TV

Revenue contribution, 2012

10

20 5 2

11 48

0

10

20

30

40

50

60

70

80

90 Ana

log

SD

HD

VAS

Adv

ertis

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Tota

l

Rev

enu

e (U

S$

bil.

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Revenue contribution, 2020

4

43

14 4

21 86

0

10

20

30

40

50

60

70

80

90

Ana

log

SD

HD

VAS

Adv

ertis

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Tota

l

Rev

enu

e (U

S$

bil.

)

Page 13: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

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Fiber deployment will increase, mobile broadband will dominate in emerging markets

Broadband Trends By Platform, 2004-2020

0

100

200

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400

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600

700

800

900

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Bro

adb

and

Su

bs

(mil.

)

Wireless FTTx ADSL Cable

63 83 111

144 193

253

320

400

478

545 599

645 685 723

760 798

835

Page 14: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

Product innovation has already begun

Operator - Service Name Product Offering

Foxtel •  On-demand, catch up services - Authenticated model •  60 linear channels, and ~200,000 titles on demand •  App downloaded to 500,000+ devices •  12 linear channels (in-house) and PPV. •  Available to Astro and non-Astro subs in Malaysia and select intl markets •  Crosses 400,000 app downloads

•  39 linear channels and on-demand content

•  1.4mil app downloads •  Offers the FMP and HBO GO OTT services to movie pack subs •  Available on authenticated basis and stand-alone OTT

•  ~15,000 titles available as of April 2013 •  Pay OTT service for non-subs

•  Provides real time access to over 140 linear channels and ~30,000 VoD titles •  4 mil. registered users

•  Available to Fox Movies Premium subs •  Content available online 24hours/1 week after airing on linear TV

•  1,000 hours of original HBO content available, with new releases available within 12 hours after US telecast.

Page 15: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

Operators emerging as content powerhouses

In house* channels

Key Genres

Total Content Investment (US$ mil.)

71 20 16 26

Sports, News, GE, Movies, Ethnic,

Music, Kids

Sports, News, GE, Movies,

Lifestyle, Religious

Sports, News, GE, Movies, Music

*Includes on-demand and HD channels

Sports, News, GE, Movies, Factual,

Music, Kids

46

Sports, News, GE, Movies, Music

420 95 70 180 1,400

Page 16: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

Varying stages of operator evolution

Launch Phase Product & Service Differentiation Platform Agnostic Packaging HD+DVR Multi-Screen Linear

Page 17: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

When packaging works – evolution of Astro packaging

Super Pack (5)

Mini Pack (5)

Family Pack

Then (in 2010)

Multiple combinations of packs

ARPU = US$26

Mini Pack (5)

Prime Pack (2)

Plus Pack (5)

Now (in 2012)

Family Pack

Multiple combinations of packs

Overall platform ARPU = US$31

DVR + HD + VoD + MS

Astro Super Pack

But Super Pack ARPU = ~US$45

Plus Pack (2)

Page 18: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

Pay-TV remains capital intensive

ASTRO TATA SKY AIRTEL MNC SKYVISION

US$1.6 bil. US$1.0 bil. US$0.7 bil. US$0.3 bil.

Company and

Brands

Total Investments

Page 19: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

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Investment activity will accelerate

Primary Investments, 2012

5.6

2.3

0.5 0

1

2

3

4

5

6

Loans IPO Bonds

US

$ b

il.

Key M&A Deals, 2012

TAIWAN n  TBC IPO

PHILIPPINES n  Sky merger

with Destiny

INDONESIA n  MNC SkyVision,

landmark IPO deal

KOREA n  CJ M&A

INDIA n  Providence invests in Hathway

AUSTRALIA n  News Corp.

acquires CMH

MALAYSIA n  Astro, large-

scale US$1.4 bil. proceeds

Page 20: Asia Pacific Pay TV Operators Summit · Analysis of Pay TV ARPU and Penetration Dynamics in Asia Pacific (2012) Australia China Hong Kong India Indonesia Japan Korea Pakistan Malaysia

What’s next for operators? M

atur

e M

arke

ts

Developing M

arkets

Transition to all IP networks

User Interfaces and User Experience (UIEX)

Big data and analytics

Targeted Advertising

Tapping into pay-adverse homes

Focus on linear video + VAS

Content exclusivity

Clearer, simpler packaging

Return path via wireless broadband