Pay-TV piracy deprives industry of $US1.54 billion for 2007
5 November 2007
Hong Kong - Piracy cost the regional pay-TV industry $I.54 billion in lost revenue in the past 12 months, up from $US1.13 billion in 2006, according to the annual survey by CASBAA and Standard Chartered Bank.
Covering Hong Kong, India, Indonesia, Malaysia, the Philippines, Singapore, Taiwan, Thailand, Vietnam, Australia, Macau and new addition Pakistan, the report also estimates at least $213 million has been lost in unpaid taxes across the region this year.
Lee Beasley, Head of Media and Entertainment of Standard Chartered Bank noted, “The pay-TV piracy situation in most of the big markets in the region needs to be seriously addressed, not just by the industry but also by government. Nonetheless, the fact that legitimate paid subscriptions are seeing an average 10% growth is a positive sign of the vast potential for the Asia Pacific pay-TV industry.”
Pakistan, surveyed for the first time, suffered revenue losses of $110 million with 4.6 million pirated cable-TV subscriptions, versus 345,000 legitimate subscriptions. Excluding Pakistan, the regional leakage was $1.43 billion, up $300 million or 26% from 2006.
Piracy in Hong Kong fell 15% to $27.4 million although the number of hacked connections remained unchanged. Simon Twiston Davies, CEO, CASBAA, attributed that to the lower cost of pay-TV subscriptions due to increased competition.
While much of India’s revenue losses has been attributed to a 20% US dollar re-alignment against the Indian rupee, Twiston Davies noted, “The India pay-TV market is the most distorted in Asia thanks to what can only be characterised as structurally-based revenue leakage.” With 73 million pay-TV connections, India continues to suffer from “heavy-handed” government regulation which has resulted in a lack of investment in infrastructure. Net losses reached $985 million in 2007, up 44% over 2006. A “systemic shortfall in analogue revenues” from local cablers was identified as a major problem.
Vietnam saw a “dramatic fall” in illegal connections as industry losses declined from $38 million in 2006 to $10 million this year. The improvement has been attributed largely to the removal of pirated international channels from local operator VTC, according to Beasley. He said the Vietnamese government has begun to fulfil its international trade commitments and to “listen” to its legitimate industry.
Thailand recorded 1.32 million unauthorized connections and suffered losses of $180 million, the second highest in the region. Despite a slight improvement in the approach to intellectual property rights by some cable operators in Thai provinces, there has been a growth of illegal Internet-based card-sharing (via remote servers) for DTH services. Calling it a new and “sophisticated” technical hack that increases the vulnerability of DTH services to piracy, Twiston Davies pressed for industry vigilance, continued investment in technical protection and legal sanctions.
CASBAA has continued to lobby governments and launched legal actions against commercial distributors of unauthorised signals in public venues in Hong Kong and pirate operators in the Philippines. The Hong Kong actions have successfully concluded while the cases in the Philippines are still before the court.
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