Last Wednesday marked the first anniversary of digital TV in Thailand, and operators say the broadcasting structure designed by the National Broadcasting and Telecommunications Commission (NBTC) has failed to help the industry.
A stack of subsidy coupons for digital set-top boxes await delivery by the post office. A year after digital TV broadcasts officially began, operators claim the broadcasting structure has harmed the industry. (Photo by Thanarak Khoonton)
"It's very disappointing that digital TV has not met society's expectations," said Surin Krittayaphongphun, executive vice-president of BEC World Plc, the operator of Channel 3.
He said the structure designed by the NBTC did not suit the business environment, while the market was oversupplied with too many competing channels.
There are now 24 commercial channels, while 12 public channels are set to debut over the next 12 months.
Channel distribution remains a key problem for digital TV, similar to the analogue system.
Operators must resolve this problem themselves by paying extra fees to have satellite TV providers in remote locations carry signals to viewers in these areas.
Mr Surin said the high licence fee was also a heavy financial burden for digital TV operators.
They are required to pay the fee in advance instead of using their own funds to develop content or invest in studios or enhancing human resources.
When channel operators face serious liquidity problems, their content quality declines.
The NBTC has stipulated that all licence fees from digital TV auctions must be paid within six years.
"The failure of digital TV operators also reflects inefficiency by the national broadcasting regulator," Mr Surin said.
He said there was only a slim hope that digital channels would attract more media spending.
Birathon Kasemsri Na Ayudhya, head of commercial and business development at TrueVisions, said the present situation of too many channels was impractical and made it difficult for operators to survive in the long run.
Each channel may take a very long time to break even, he said. The number of channels quadrupled overnight, while marketing and advertising budgets for product makers and brands rose by only 5-10% per year.
Kemmathat Paladesh, president of Bangkok Media and Broadcasting Co, operator of the PPTV Channel, said regulations did not match market forces, airtime was oversupplied and broadcasting technology remained uncertain.
The NBTC is creating a terrestrial digital broadcasting platform, forcing viewers to change their watching behaviour and shifting to this system.
Mr Kemmathat said if there was no regulation change, digital operators might have to restructure to survive. They will have to either find new shareholders to provide funding or return their licences.
Payao Thammateerasuntorn, TV investment manager at Mindshare Thailand, said digital TV had caused difficulties, with media companies encountering complexities in communicating with consumers.
Col Natee Sukonrat, chairman of the NBTC's broadcasting committee, said digital TV had passed the toughest test, and the proportion of digital viewers was 27% of the total one year on. Viewers have more choices now, he said.
Col Natee said incumbent operators such as Channel 3 and 7 would gradually lose their dominance, given free-market competition.
He insisted 24 commercial channels was a suitable number.
After one year of operation, digital TV operators claim the broadcasting structure has failed to help the industry. THANARAK KHOONTON