The operators of seven struggling digital TV channels have confirmed plans to return their licences and exit the business as widely expected, leaving only 15 channels on air, down from 22.
Signing off are Channel 3 Family 1 and Channel 3 SD 28, Spring News 19, Spring 26 (formerly Now 26), MCOT 14, Voice TV 21 and Bright TV 20. They submitted letters of intent on Friday and are expected to officially go off the air in August.
They are throwing in the towel five years after paying huge sums for licences following a bidding frenzy, in the belief that operating a digital channel would be a licence to print money.
Now taxpayers are being asked to bail out the ailing industry, although the National Broadcasting and Telecommunications Commission (NBTC) insists the state assistance to all 22 operators will cost “less than 38 billion baht”.
NBTC secretary-general Takorn Tantasith said the sum would comprise 13.6 billion baht from waived licence payments from the exiting operators under a Section 44 order issued by the outgoing junta; 18.7 billion for the remaining nine years of all 22 digital TV licences that the government will subsidise; and the remainder to compensate the seven exiting channels for the remaining licence terms they must forfeit.
Mr Takorn said the digital TV business has been facing an increasing challenge from internet-based businesses such as over-the-top (OTT) platforms that are taking as much as 90% of advertising revenue from some traditional media. The NBTC acknowledged some channels had faced net losses as high as 10 billion baht over the last four years.
Mr Takorn said the NBTC would try to expedite compensation, probably no later than August, to the operators after they exit. He declined to disclose the exact amount the seven channels would receive.
“It may be several billion baht, but it is too early to say clearly,” he said.
Each channel that quits the business will receive compensation after subtracting the amount of assistance it received for the must-carry rule and broadcast network rental fee subsidy, as well as annual net profits.
“The compensation figures released by the media and analysts were not true, because the exact figures need to be calculated and rechecked by related parties,” said Mr Takorn.
He also said the NBTC had ordered the seven channels to pay proper compensation to employees at rates “no lower than” what is prescribed in labour legislation.
“The prime minister raised concerns over the compensation benefits to digital TV employees and their families who will be affected by the exit,” he said.
According to the existing timeline, the operators have to submit all related documents to the NBTC by July 10, or 60 days after submitting their letters of intent to shut down.
Suphap Kleekachai, president of the Association of Digital TV Broadcasting, has estimated that about 5,000 people will be affected by the operators’ decisions to go off air.
The NBTC will take the proposals to its board for approval in July. After getting approval, the channels have to give viewers at least 30 days’ notice before they go dark.
Shares of BEC World, which operates Channel 3 Family 1 and Channel 3 SD 28, rose 2.3% on the Stock Exchange of Thailand to 8.75 baht. But MCOT shares fell 1.85% to 10.60 baht.