Market Insight

CASBAA Convention 2016 - IHS Markit key takeaways

November 23, 2016  | Subscribers Only


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The CASBAA Convention 2016 brought together pay TV operators, content creators, OTT providers, advertisers, and regulators in the Asia Pacific to discuss the latest developments in the cable and satellite television broadcasting industry. The key takeaways of the three-day event in Macau were:

  1. Pay TV is here to stay but operators are witnessing an increase in consumption of content on devices other than TV screens.
  2. There is a need for a holistic measurement of traditional and digital media whilst the importance of data analytics continues to grow.
  3. Programmatic TV in Asia Pacific needs more reliable data.
  4. The role of telecommunication companies in the TV ecosystem continues to increase.

Our analysis

Mobile devices continue to consume an increasing amount of TV content within the Asia Pacific, but this does not spell the end of pay TV. The Asia Pacific markets are diverse where advances in infrastructure and media consumption patterns vary significantly. For example, broadband penetration and the purchasing power of consumers in Singapore and South Korea is high compared with the region’s developing markets, such as China and India. This translates to a wide range of opportunities and challenges for operators across the region from capturing new markets to scaling services.

Meanwhile, digital disruption in the media landscape is placing a growing importance on data analytics for pay TV operators. In February 2016, Rentrak and ComScore merged to form a cross-platform measurement company to encompass TV set-top box, digital, movie screens and demographic information. The granularity of data is critical for agencies to offer effective investments for advertisers. As a result, we will see more merger and acquisition (M&A) activity in this space to broaden coverage, realise synergies and strengthen the services from measurement companies for their clients. For example, Dentsu Aegis Network (UK and Japan) acquired five analytics companies between June and September 2016, two of which are specialized in programmatic advertising as was reported in the IHS Markit Media & Advertising M&A Market Monitor published in November 2016. Pay TV is here to stay but an integrated measurement mechanism and the availability of data analytics are essential to enable effective advertising in the region.

As media agencies encourage TV operators to embrace programmatic TV, some broadcasters are sceptical about the premise of such a strategy. IHS Markit believes the problem stems from a lack of reliable data and as such, recommends operators work together with addressable advertising companies to provide post-campaign data and analytics via set top boxes. We also see Malaysian pay TV operator Astro utilising the household purchase and retail sales data they generate from their e-commerce platform to direct their core pay TV business strategy. We expect other operators to adopt a similar process in the near future.

Discussions at CASBAA also targeted disruptions to the traditional pay TV ecosystem. The industry recognizes the increasing role of telecommunication players, notably in working with content providers in over-the-top (OTT) distribution. In particular, the co-dependence on each other to succeed whereby a telco needs content and OTT operators need distribution. As a result, we also expect more partnerships between telcos and OTT providers to form in the near future. 

 

Organization
WPP
Research by Market
Media & Advertising
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