BEC World sees flat revenue in 2014
BEC World, the parent company of Channel 3, expects flat revenue growth year on year in 2014, mainly due to a drop in advertising spending and fierce competition from new terrestrial-based digital TV broadcasters.
In line with other media companies in the industry, BEC World also suffered from a decline in advertising spending last year. According to Nielsen (Thailand), January-to-November advertising expenditure fell to Bt93.8 billion, a 9.8-per-cent decline from Bt104 billion in the same period in 2013.
"We expect zero growth in last year’s revenue," said Surin Krittiyaphongphun, executive vice president at Bangkok Entertainment Company (BEC), the operator of Channel 3.
Surin added that it would be great for the company if overall business performance last year could match that of the previous year.
The market saw changes in 2014, not only due to the overall decline in the media industry but also from the launch of numerous digital terrestrial TV channels.
BEC World, which is listed on the Stock Exchange of Thailand, reported revenue of Bt16.43 billion in 2013. Channel 3, an analog station run under a concession with MCOT, was the main revenue contributor for the holding company. Through its new subsidiary BEC-Multimedia, BEC World also owns three licences to operate terrestrial-based digital TV stations – two for variety programmes in high and standard definition (3HD and 3SD), and another for family programmes (3Family).
Besides suffering from the decline in the industry, an analyst at KKTrade – a member of the Kiatnakin Phatra Financial Group – estimated that with the launch of the new digital TV channels, BEC World had to shoulder the operation costs of the 3SD and 3Family channels.
The costs were estimated to be about Bt100 million to Bt150 million after adding new programming for both digital channels since September.
The analyst also said that the month-long dispute about the broadcast of analog Channel 3 on cable and satellite TV platforms delayed advertising revenue. Channel 3’s free-TV status was revoked after the National Broadcasting and Telecommuni-cations Commission (NBTC) imposed its revised must-carry rule.
As such, cable and satellite TV operators had no obligation to carry Channel 3 analog on their platforms. Channel 3 claimed the new rule would hurt its business, as 70 per cent of all households in the Kingdom watched its programmes via cable and satellite TV receivers.
Eventually, the dispute between Channel 3 and the NBTC landed in the Central Administrative Court and ended up in a win-win solution: Channel 3 analog could be simulcast via 3HD channel, operated by its affiliate BEC-Multimedia. As a result of this move, Channel 3 analog could be seen on cable and satellite TV platforms, like MCOT’s Modernine TV and Channel 7.
KKTrade’s analyst forecast BEC World would end 2014 with Bt16.42 billion in revenue.
