Wednesday, September 18, 2019

No significant impact on broadcast industry from return of licences

Aug 16. 2019
SCB Economic Intelligence Centre's  senior analyst, Kamonmarn Jaenglom
SCB Economic Intelligence Centre's senior analyst, Kamonmarn Jaenglom
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By THE NATION

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The return of seven licences by six digital TV broadcasters will have only a slight positive impact on the industry in the short-term, according to Siam Commercial Bank's Economic Intelligence Centre.

Three broadcasters – Spring 26 (Channel 26, formerly known as Now 26), Spring News Television (Springnews 19 Channel) and Bright TV (Channel 20) pulled the plugs on their channels on the midnight of August 15 after returning their licences to the National Broadcasting and Telecommunications Commission (NBTC).

Three other broadcasters returning their licences are: Voice TV (Channel 21), MCOT (Family Channel 14) and BEC Multimedia (Family Channel 13 and 3SD Channel 28). They will go off the air gradually by October.

These six commercial digital TV broadcasters had announced on on May 10 – the deadline for broadcasters intending to surrender their licences – that they would return a total of seven licences they had secured from the NBTC following an auction in 2013.

The SCB centre's senior analyst, Kamonmarn Jaenglom, said that advertising revenue of these seven channels during the past five years accounted for less than 5 per cent of total TV advertising spending.

Corporates had also curtailed spending on TV advertising due to the volatile global and local economies this year as well the increase in digital TV operators' airtime rates by over 4 per cent.

She added that the remaining broadcasters will still experience pressure from the decline in advertising revenue.

But in the medium term, they could generate more revenue and profit from the increasing advertising spending of direct TV companies.

Most of the broadcasters have adjusted their strategies by focusing on purchasing appealing international and local content, instead of producing their own content which entails a higher cost, she added.

Most of them have launched their own online channels, which fit well with the changing consumer behaviour, she said. The online channels will also become their new revenue source.

Ad spending on terrestrial and digital TVs dropped 3.33 per cent in July this year to about Bt5.774 billion, from Bt5.973 billion, according to a Nielsen media report.

Cable and satellite TV channels saw a 3.50 per cent drop in ad spending from Bt200 million to Bt193 million. Radio advertising was equally affected, dropping 1.44 per cent year on year from Bt418 million to Bt412 million, while outdoor media followed the same trend, dipping 0.34 per cent from Bt590 million to Bt588 million in July this year.

Related story: NBTC hands out refund cheques to 3 digital broadcasters

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