India leads in pay TV piracy in Asia-Pac

HONG KONG: Pay television piracy continues unabated in the Asia-Pacific region, with total loss in revenue estimated to be $1.13 billion in 2006, out of which India’s dubious contribution is a whopping $ 668 million.

According to study on piracy in Asia-pacific released by Cable and Satellite Broadcasting Association of Asia (Casbaa) here today ahead of their three-day annual convention, for the fourth consecutive year pay TV piracy has shown an increase with illegal pay TV subscription across the region growing by 20 per cent in 2006 to 5.2 million.

The report, undertaken in association with Standard Chartered bank, also highlights that pay TV piracy will result in net estimated tax revenue loss of $ 158 million to the region’s governments in 2006.

In particular, the piracy situation in India (considered the biggest accessible market, though), Hong Kong and Vietnam continues to worsen, the report said.

Asked by whether the Indian and foreign players operating in India have undertaken any concrete anti-piracy initiatives in India instead of just blaming the government, Casbaa CEO Simon Twiston Davies said, “The industry is constantly in talks with the government and the regulator on the issue.”

He added that Casbaa has also exhorted the government to “review” existing regulations and strengthen digital infrastructure.

The grey market deficit in India due to under-reporting by cable operators has grown from $ 632 million in 2005 to $ 667 million in 2006.

Thailand also suffers from rising cost of piracy and at $ 160 million revenue loss has the second highest rate of piracy in the Asia-Pacific region

Other markets facing an uphill pay TV piracy battle include Vietnam and the Philippines.

The “Greenfield” market of Vietnam has the worst ratio of piracy in the region with one legal pay TV subscriber for every 15 illegal connections.

In the Philippines, estimated net piracy costs due to illegal distributors, largely in provinces, has risen by 24 per cent in 2006.

Indonesia is not far behind with revenue leakage of $ 23.8 million as government and industry insiders indicate a substantive piracy growth.

Singapore is the only market covered by the report that brings some cheer to the industry reeling under piracy.

As a result of ongoing digitization of cable networks, the number of pirated pay TV subscriptions remains low with a 15.8 per cent decline in piracy costs.

Macau, covered in the study for the first time, has the unenviable distinction of having the region’s second highest piracy rate with 10 pirated connections for every one legal subscriber.

The study notes that the Macau government’ anti-piracy measures announced last year have been inadequate to arrest rising piracy.

The new study estimates that the cost of piracy in Hong Kong for 2006 will be $ 32.4 million, a hike of 29 per cent over last year.

“This could have a genuine impact on Hong Kong’s reputation as an intellectual property rights hub,” Davies said.

Pointing out that pay TV piracy is “corrosive” in nature and undermines investments in various markets of the Asia-Pacific region, Davies, however, said growth prospects remain good in the region.

Interestingly, piracy also results in huge losses to governments too with the study estimating that at least $ 158 million being annually lost to regional governments. The losses corporate profit tax ($ 127 million) and VAT/GST ($ 31 million).

The governments in the region taking the maximum hits due to loss in tax revenue include those in Thailand ($ 59 million), the Philippines ($ 38 million), Australia ($ 14 million) and Vietnam ($ 12 million). The India figure for this segment was not available.

No wonder, Standard Chartered head of media and entertainment Lee Beasley said, “Pay TV piracy should raise an alarm not only in the pay TV industry, but also for a range of Asian governments.”

Meanwhile, the annual Casbaa convention where industry people from the broadcasting and cable industry, investors and regulatory authorities from round the globe are converging kicks off Wednesday.

Apart from the usual rounds of seminars and debates on issues of relevance, a tech exhibition too is being organized.

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