Piracy Costs For Cable TV Are Increasing
Piracy cost pay-television operators and broadcasters in Asia $1.75 billion in lost revenue for the year ended in June, according to a rough estimate by an industry association.
The figure, which is 14% higher than last year, tracks missed revenue stemming from pirated set-top cable boxes, unauthorized satellite connections, and gray-market cable operators. It was compiled by the Cable & Satellite Broadcasting Association of Asia, which developed the estimate with Standard Chartered Bank. The estimate was influenced by currency fluctuations.
The increase comes as the $26 billion Asian pay-TV industry is booming, with subscribers increasing by 17% in the same period last year, according Casbaa. 'As the product becomes more valuable, it is more prone to theft,' said Marcel Fenez, the chairman of the organization.
Casbaa's piracy estimate doesn't account for losses related to Internet piracy, which could be high in Internet-savvy markets such as China and South Korea.
The industry uses its estimate to lobby governments to adopt antipiracy measures and convince them that the problem costs them tax revenue. The best solution, said Mr. Fenez, is digital-cable technology that is harder to steal, but often is more expensive.
But in a region where many cable-TV systems are mom-and-pop companies stringing cable connections to homes, piracy can be a murky problem. Only $187 million of the estimated loss came from people who bought pirated set-top boxes.
The vast majority -- some $1.1 billion in lost revenue -- comes from India. Most of the 85 million cable-TV homes there pay for cable, but receive their signal through a gray-market provider that doesn't report all connections to channel providers.
Even as it loses subscription revenue through this system, the Indian TV industry still uses data on unreported subscribers to sell advertisers on pay TV's vast reach.
'Still, that is theft from the legitimate value chain,' said Mr. Fenez, and it forces channels to rely too much on cyclical advertising revenue. |
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