taiwan busines s

taiwan busines s

Whats on (International) TV?

Photo : STAR Sports

The viewing habits of the Taiwan audience tend to be more parochial than their counterparts in many other markets in the region.
BY AIMEE WONG

nternational television content in Taiwan spans the spectrum of global media from American football to Bollywood cinema. Despite challenges from industry regulations and the transition to digital technology, the Taiwan market offers quite a few surprises. In fact, in certain respects international programming here actually outshines what can be viewed elsewhere. For example, it can be difficult to view out-of-market sports teams in the United States, where most games are shown on regional sports networks based on local interest. Actually people in Asia, especially people in Taiwan, who want to watch sports are luckier than the viewers in the States, says Hsi Shen-lin, managing director of ESS Asian Networks Taiwan Branch

(part of ESPN STAR Sports), which operates more than 20 channels covering 24 countries in Asia. They can watch more than 10 Major League Baseball games in a week, most of the top-level football in Europe, and also have a chance to watch the most popular local sports like Super Basketball League (SBL) on the same platform. Though Taiwan is one of the Four Asian Tigers, the viewing behavior of its citizens differs considerably from that of audiences in Hong Kong, Singapore, and South Korea, which are more international hubs with larger expatriate communities and higher levels of English ability. News channels, for example, are one area in which foreign content providers are simply unable to gain a significant foothold in Taiwan. The Taiwanese are very fixated on

local news, says Jay Lin, CEO of Portico Media, a media production and distribution company that operates 12 digital channels on the island. Taiwan news reporting is very local, and a lot of it is social news very soap operaish, almost like National Enquirer reports. International news that tries to break into this market is hindered by a lack of language understanding and the exorbitant localization cost. In other countries like Singapore or Malaysia, people watch a lot more international news. The enormous variety of available content poses a major challenge for international providers here. How does one approach this market when Taiwanese viewers preferences vary so widely? For HBO, the answer is simply to

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broadcast the same content as across the 21 other markets in its AsiaPacific region. HBO Asia is branded in Taiwan as a Western, Hollywood channel that brings the best and the latest Hollywood blockbusters, said Jacelyn Kek, HBO Asias senior vice president for sales and marketing, in a phone interview. Taiwan enjoys the same quality content as the rest of the Asia-Pacific region. Sony Pictures Television Networks operates six brands across 22 countries in Asia, including AXN and Animax in Taiwan. The AXN content in Taiwan is similar to what is shown in other parts of the region, but with a stronger focus on movies and action/adventure drama series, especially ones that have storylines that conclude within each episode. Two of their more popular shows here are CSI and Hawaii 5-0. When it comes to reality shows, however, the Taiwanese preference is a bit different from other parts of the world. Taiwanese viewers tend to be drawn more to celebrity-driven shows, while viewers in the West prefer real, everyday people to star in such reality series, notes Calvin Wong, communications manager at Sony Pictures Television Networks-Asia. But we do see that changing, with AXN broadcasting shows such as WipeOut , which features ordinary people running obstacle courses that are gaining popularity in Taiwan. And remarkably for a country that is typically more interested in American sports like basketball and baseball than in European football and rugby, Taiwanese are particularly keen on the FIFA World Cup. Although football ratings usually hover around 0.1 (still a 10-fold growth from two years ago, when they were at 0.01), they can reach 2.5 during the tournament. Its hard to understand, because generally people in Taiwan dont watch football at all, or very few of them do, Hsi says. But they're not actually watching the World Cups for the football, he explains. Theyre watching something akin to a drama about an international world war happening in a remote country, and when everybody in the world is chasing

this event, its more than a sports event. Theyre watching a news event, a world trend, a most-talked-about topic in the world at the same time as the rest of the world. Fox International Channels (FIC), the international multimedia arm of News Corp., offers a combined force of 24 channels in Taiwan, including the FOX, National Geographic, and STAR brands. While many of FICs channels are also pan-Asian in coverage, the company does occasionally purchase content specifically for Taiwan, such as a special program with Estee Lauder to promote breast cancer awareness. It may also carry content originally produced for China that may not have much appeal in most other Asian markets. But what really sets FIC apart is its local productions, many coproduced and funded by government agencies, featuring travel and culture stories in Taiwan that are subsequently syndicated and broadcast by FICs other branches. The Taiwan to the World mini-series, a joint venture between FIC and Taiwans Government Information Office (GIO) broadcast features stories about Taiwan in 168 countries and 37 languages. The series garnered prizes from Taiwans Golden Bell Awards, the Columbus International Film and Video Festival, and the Montana CINE International Film Festival. I think Taiwan

to the World is something thats quite different, says Joanne Tsai, chief operation officer at FIC. We see ourselves as a bridge we bring the world to Taiwan and we bring Taiwan to the world. In addition, FIC has been capitalizing on Taiwans unique combination of Chinese culture and language expertise, relatively open regulatory environment, and adequate talent pool to initiate content for the Philippines, Singapore, and North America. Were trying to position Taiwan as a production hub so we can package this content and then distribute it to the world. Were already doing this for Chinese movies for STAR Chinese and providing that to North America, Singapore, and Hong Kong, Tsai says. Because of the talents and skills of the Taiwanese and because the market is very small, its more efficient in terms of talent and cost effectiveness. You can do a good show and stay within your budget. Operating a successful international brand means having access to a global network of resources, ideas, and technology. When ESPN HD was introduced in Taiwan, it was the second high-definition channel launched worldwide, after the United States. But while foreign content providers try to stay ahead of local competitors by importing concepts and technology from their overseas operations, not all features can

Joanne Tsai, COO of Fox International Channels Taiwan and its National Geographic Channel, speaks at the Earth Day Exhibition launch of the Polli-Boat, a vessel made of recycled materials to raise environmental awareness.
photo : national geographic

november 2011 taiwan business topics

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Publicity events to promote the launch of new shows in the local market: left, HBOs Game of Thrones, and right, AXNs Hawaii Five-O.
Photos: courtesy of HBO, AXN

be successfully transplanted to Taiwan. Limitations on the technology and capabilities of local cable operators may be constraints on the extent of localization. HBO, for example, supplies all subtitles in traditional Chinese with dual English/Chinese language text, but it doesnt yet offer dual-language audio tracks. While dual-language options are already a feature in the companys Singapore, Hong Kong, and Indonesia broadcasts, not all of Taiwans cable operators set-top boxes are able to handle dual-language options. Although HBO operates two HD channels in Taiwan, it has so far not been able to release HBO On-Demand, one of its signature services internationally. Its a question of progression, explains Jacelyn Kek. Once the tech capability is there, well come out with the product. Shes referring to the fact that on-demand channels are feasible only when the local television market has reached a sufficient level of network digitalization. Along with pro-

viding greater bandwidth efficiency, allowing for higher quality and greater variety in content, digitalization permits broadcasters to provide electronic program guides, multiple language options, as well as multimedia and interactivity services required for videoon-demand. Television sets with analog tuners are unable to decode digital signals without the addition of set-top converter boxes. One of the concerns for cable TV companies is the potential loss of viewership by those unwilling or unable to purchase converters and/or new televisions, resulting in decreased subscriptions and advertising revenue. For that reason, markets often require some government intervention to push the digitalization process along. By the end of this year, countries that will have completed full digitalization include Austria, Belgium, Cyprus, Denmark, Estonia, Finland, France, Germany, Israel, Latvia, Luxembourg, Malta, the Netherlands, Norway, Slo-

venia, Spain, Sweden, and Switzerland. Other countries, including the United States and Japan, have completed most of the digitalization process, but continue to operate some analog transmitters. For its part, Taiwan originally slated analog shut-off for 2012, but has pushed back this date several times. According to Jason Ho, director of the Broadcasting Contents Department of the National Communications Commission (NCC), the government is considering opening up a few more public channels and bringing more HDTV content to Taiwan before requiring 100% digitalization. He confirmed that Taiwan is now aiming for 50-75% digital viewership by 2015. The current digital viewership is only about 10-15%. Over the last three years, Taiwan has gone from a purely analog TV infrastructure to something thats a hybrid between analog and digital, says Porticos Jay Lin. Theres a lack of rapid infrastructure development for

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the operators because the rollouts of the infrastructure for digital TV are kind of slow. Fewer people are able to subscribe to it, which means fewer marketing dollars allocated to its promotion, and there wont be as much revenue attached to it. If the operators arent ready to roll out digital TV in a big way, then in turn we content providers, being subscriber-based, wont grow that quickly. A proposed new amendment to the Cable Radio and Television Act now under discussion would attempt to pressure cable operators to invest in digital infrastructure by making digital capability a stipulation for receiving new or renewed broadcast licenses. The problem is that there is no incentive for cable operators to employ digital infrastructure around the island, says ESSs Hsi. Though cable operators will be able to create new tiered packages for digital cable offerings, the total price of those packages still cannot exceed the monthly maximum of NT$600 for cable television fees that the government set 10 years ago (and because

local governments also get involved in the process, the rate set in most localities is even lower). The investment in digitalization would be billions of dollars, but the operators have no opportunity to increase their revenue, says Hsi. Thats why theres been so little progress over 10 years. No matter how this problem gets worked out, digital content will unquestionably play a key role in the future development of Taiwans cable television industry. The ease of selling content to the China market sets Taiwan apart from other countries in the region. I think there will be more local content, more collaborations with China, and more foreign channels doing local productions like a Taiwan Top Chef, says Jay Lin. If the content is able to be sold into China, it changes the economics by opening up access to a much bigger market. For the regulators, a challenge will be to find the right balance in welcoming new ideas and resources from abroad while also preserving room for local firms to flourish. We encourage

competition so that well get better shows, says the NCCs Ho. We also want good foreign shows because this can encourage local shows to improve. But in addition we have to protect local shows, so a certain percentage of programming must be local. Yet the revenue cap may in fact work against the cultivation of local products, as the creation of a show from scratch entails much higher costs than simply importing existing content with a proven popular format and applying subtitles. There is a risk that new channel operators short of revenue may find it necessary to accept more paid programs or infomercials than they normally would wish to do, says Hsi. We all say standards are very important for channel operators, but when youre doing business in less than ideal circumstances, eventually you have to follow the money. You have to change your beliefs or standards to ensure your survival, to do things you wouldnt have done in the past because you wanted to maintain your standards.

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