Satellite Operator Looks to Capitalize on Digital DTH in Phillippines
Mediascape has launched a satellite pay-TV platform, Cignal Digital TV, in the Philippines, targeting the 2 million households not served by cable.
“We are trying to hit 40,000 to 50,000 subscribers in the first year,” Benjie Fernandez, managing director of Mediascape, told Via Satellite "…The uncabled market is still a relatively substantial market here. In terms of how we are approaching the market, as a satellite operator, we are very conscious of our costs. We are marketing a service at 390 Pesos ($8.15) only for a basic package of 20 channels. These channels are within the top 25 of the ratings. It is really a value for money proposition rather than one, which is based on quantity.”
The Philippines has a population of more than 95 million people, so the Cignal Digital TV platform is targeting a very small portion of the market at this stage. However, Fernandez believes the market is long overdue for a more quality based offering. “I think in terms of quality, we will be one of the best. There will be good signal clarity,” he said. “Quality is a number one priority. We hope the industry will be more quality conscious for subscribers to better enjoy watching TV. Here in the Philippines, my feeling is that the value proposition of the industry players has been more on the number of channels than quality of channels.”
The operator has been working with NDS for conditional access and middleware for the platform. Sue Taylor, senior vice president and general manager of NDS Asia-Pacific said the move into the Philippines is a significant one for the company, as this market has been blighted by piracy issues in the past. “This is the first time we have been involved in the Philippines pay-TV market and we see this as a very encouraging sign,” she said. “There have long been problems with piracy in the Philippines as demonstrated by recent raids in the region. The legal market for pay-TV is barely above 1 million homes, around 10 percent penetration, according to recent Media Partners Asia (MPA) analysis. Piracy, over-building and capital constraints have limited development thus far.”
DTH Prospects in the Philippines
Mediascape also has PLDT, the largest telco in the Philippines, as one of its backers. In theory, the operator could link an IPTV service and the DTH service at some point in the future. “That is something to happen down the road,” said Fernandez. “It might happen. There are no concrete plans at this point. In a general sense, you are talking about the different strengths of the whole group. You have the wireless group, which is very much focused on individual consumers. You have the wired group, which is into the residential and corporate customers. You then have us looking at DTH, and maybe others platforms as well.”
Taylor is confident that DTH services can really flourish in the Philippines. “Long term, we expect DTH services to flourish in the Philippines, so long as the issue of piracy is addressed in an ongoing consistent basis,” she said. “This will be good for subscribers, providing greater access to premium content, and good for operators, allowing them to run successful businesses with innovative new services for subscribers. To maintain the healthy growth of satellite pay-TV in this market there needs to be a strong legal framework, companies operating within the framework, investment into the industry and strong consistent enforcement of anti-piracy laws.
Taylor believes the growth potential in the market is similar to what has been seen in India. “The Philippines pay-TV market is similar to the India market in the sense that both have only recently begun moving towards digitization and wider viewer choice. The total pay-TV subscribers in India is about 82 million which is much higher than the one million subscribers in the Philippines. However, the digital penetration in both markets is low at around three percent and one percent in India and the Philippines respectively. The potential for growth in both markets is huge.”