Proposed leasing fees for HD TV 'too high'
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Some companies planning to bid for digital-television broadcast licences say the leasing fees for high-definition channels proposed by the four state-run TV broadcasters are too high.
“We are highly concerned about these network-leasing fees for HD channels, ranging from Bt13.81 million to Bt14.28 million per month,” Watchara Vatcharapol, chief executive officer of Triple V Broadcast, said yesterday.
Triple V Broadcast, wholly owned by the publisher of the Thai-language Thai Rath newspaper, currently operates Thai Rath TV. The company intends to bid for three licences, for variety channels in both high and standard definition and a news channel.
“If we choose MCOT as the network operator, the company will be charged about Bt3,300 per minute for the network service. This cost is almost on par with advertising rates currently offered by a satellite and cable TV channel,” Watchara said.
The networks for HD channels will be leased out by the Royal Army, MCOT, the Public Relations Department and Thai Public Broadcasting Service.
Additionally, media agencies are concerned that HD channels will face high initial costs, particularly what they spend on the auction itself.
Wannee Ruttanaphon, chairwoman of IPG Mediabrands Thailand and of the Media Agency Association of Thailand, said high fixed costs, particularly auction fees that begin at Bt1.51 billion, would put the HD channel operators at high risk.
On behalf of media agencies that are a key source of revenue in the Bt70-million broadcasting industry, Wannee pointed out that programme ratings were the most important factor for advertisers, not HD technology.
Meanwhile, Rose Media and Entertainment, which wishes to bid for a licence to run a children’s channel in standard definition, also expressed concerns over the high cost of network service. Puntid Tosomsakul, programme manager for broadcast business, said the leasing fees were too high for newcomers.
Network leasing fees for SD channels range from Bt4.6 million to Bt4.76 million a month.
He added that his company had earmarked about Bt300 million for operating costs, new studio investments and content production.
Natee Sukonrat, chairman of the National Broadcasting and Telecommunications Commission’s broadcasting committee, insisted: “Variety HD channels will be the flagship TV category in the coming auction of 24 digital terrestrial TV licences.”
He explained that HD channels would provide better-quality images and viewing experiences than SD ones. Besides the cutting-edge technology, there would be advantages from being one of the country’s first HDTV operators in the terrestrial system.
Furthermore, the leasing fees for digital TV network service noted by his panel on Monday were maximums, Natee added.
“The rates could be reduced if the digital TV network operators and channel operators agree during their negotiations,” he said.
Adisak Limprungpatanakij, president of Nation Broadcasting Corporation, said yesterday that he agreed with the leasing fees proposed by the four state-run TV broadcasters. The rates were reasonable for channel operators.
Under Nation Multimedia Group, NBC Next Vision aims for a news channel, Nation Kids is going for a children’s channel and Bangkok Business Broadcasting wants to secure a variety SD channel.
Adisak added that if they clinched licences to operate those channels, Thai PBS would be the digital TV network operator for NMG’s companies.
He declined to comment on how long it would take the company to see profits from this huge investment as there were many factors influencing business sustainability, such as the number of competitors, how TV ratings would be measured and the simulcast process.
The NBC president believes, however, that digital TV will be a lucrative business both for existing broadcasters and newcomers, especially if the NBTC can achieve its goal of switching off the analog system entirely within five years.
