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Study: China Tops Japan in Asia-Pacific Pay-TV Market

27 Mar, 2013 By: Erik Gruenwedel

Pay-TV revenue in Asia-Pacific will increase $12 billion by 2018 to $43.9 billion total, according to a new report from Digital TV Research. The report estimates pay TV revenue (subscription video-on-demand and transactional VOD) will grow by $2.1 billion in 2013 to $33.9 billion.

The Asia-Pacific region includes more than 45 countries led by China, Japan, South Korea and Australia. Indeed, China, which is experiencing increased demand for digital entertainment, topped Japan last year for the first time in pay-TV revenue, according to London-based Digital TV Research.

By comparison, electronic distribution of home entertainment in the United States topped $5.13 billion in 2012, according to DEG: The Digital Entertainment Group.

“Pay-TV revenues will more than double in five countries [Indonesia (tripling), Pakistan, the Philippines, Thailand and Vietnam] between 2012 and 2018, but will fall in Hong Kong and South Korea,” Simon Murray, author of the report, said in a statement.

The findings underscore increased interest by Hollywood studios to sign content distribution agreements and establish production facilities in China.
Spearheading digital distribution is You on Demand, a U.S.-based service operating in China, which has secured content license deals with Screen Media, Warner Bros., Disney Media Distribution, NBC Universal, Paramount Pictures, Lionsgate, Miramax, Magnolia Pictures, Gravitas Ventures, Film Buff, K2 Communications, 3net and Big Mama Digital Entertainment (karaoke).

Fueling some of the surge is the fact that Asia-Pacific is undergoing a digital TV conversion that will see household penetration increase from 16% in 2008 to 44% in 2012 and 90% in 2018 — or up by 440 million homes between 2012 and 2018. By the end of 2013, digital penetration will reach 53%, or 420 million homes (up by 78 million from the end of 2012).

“Despite the rapid conversion, digital TV will still have plenty of room for growth for some time to come,” Murray added. “Only six of the 15 countries forecast in this report will have fully converted to digital by 2018.”

By then, the report said Indonesia and the Philippines would have digital penetration of only 42% and 34% respectively. Indonesia will still have 29 million analog homes, while India will have 31 million.

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