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Success of transition to digital TV not a guarantee of quick profits, NBTC member says (The Nation)

04-05-2015

Success of transition to digital TV not a guarantee of quick profits, NBTC member says (The Nation)

THAILAND has made a successful transition to the era of terrestrial-based digital television from analog, according to Natee Sukonrat, a member of the broadcasting regulator. However, he admitted, this successful transition does not always mean individual holders of digital-TV licences are also successful, at least not right away.

Natee, chairman of the broadcasting committee of the National Broadcasting and Telecommunications Commission (NBTC), said Thailand had ushered in the digital-TV era more quickly than many other countries, thanks to good preparation.

His committee last year gave away vouchers to households towards their purchase of digital-TV receiving equipment after switching to the new system in 2013. Some countries such as Japan waited for six or seven years after the transition to digital before initiating a similar voucher programme

Natee said the transition to digital sparked full competition in the TV broadcasting industry, and now no single broadcaster can enjoy the lion's share of advertising and viewers, unlike in the analog era

The broadcasting committee held an auction in December 2013 for digital TV licences that resulted in the granting of 24 licences to 17 successful bidders in April last year. The total value of the licence payments was Bt50.86 billion.

According to a survey by Nielsen (Thailand), as of last month, 21 of the 24 commercial digital TV channels accounted for 28 per cent of total viewers, while the remaining six (three commercial and three public), accounted for 72 per cent. Natee said that although the digital transition in general could be seen as a success, some broadcasters might not see any profits for as much as five years, depending on many factors, including the national economy.

Recently a group of digital-TV licence holders asked the NBTC to extend the due date for the second instalment of their up-front licence fees by one year from the currently scheduled May 24. Some of them said the licensing body had to take responsibility for failing to create a favourable landscape for the business.

Recently, the NBTC board approved their request in principle. However, the final approval is subject to the results of a public hearing on key issues on Wednesday. The issues to be put to the hearing include whether the postponement should mean the digital-TV operators must pay the second and third instalments at the same time, in May next year, or whether they will pay the second instalment next May, and the third in May 2017.

The other issues are whether the operators should be required to pay the delayed instalment fee plus interest, and whether the NBTC should introduce a measure to protect consumers from the potential effects of delayed fee payments.

Regarding the economic factor, Natee said that before the December 2013 licence auction, the Fiscal Policy Office had predicted that gross domestic product would grow by 5 per cent that year and 4.5 per cent in 2014. However, what actually happened was that GDP expanded only 2.9 per cent in 2013 before plunging to 0.9-per-cent growth in 2014.

MCOT and the Public Relations Department, two of the four licensed operators of digital TV transmission networks, have also failed to meet their schedules to set up their networks. While MCOT is only a few months behind, the PRD has yet to start procuring the necessary equipment for transmission network. As it happens, though, this has not affected any commercial broadcasters as none of them planned to use the PRD network anyway.

An industry observer has said that one factor hindering the smooth progress of the digital TV industry is the lack of consensus among the five broadcasting commissioners in some cases. Natee said all of the members of his committee were free to express their opinions.