Guest Column: Regulating video in the internet age: Pressing challenges, slow movement
Jan09

Guest Column: Regulating video in the internet age: Pressing challenges, slow movement

Video markets in Asia, as in other parts of the world, are being swept by a wave of commercial and technological adjustment to the rise of internet-delivered video, frequently referred to as “OTT” television.  Unfortunately, in most countries adjustment of regulatory policies by governments is way behind. Asia’s cities, in particular, are rapidly being wired for broadband connectivity.  In developing countries like Thailand, the Philippines, Indonesia and India a broad digital divide has opened, with major urban areas enjoying improving connectivity and the countryside still reliant on more traditional modes of video delivery to consumers. That divide is a problem needing attention, but in the meantime urban populations, at least, are enjoying a “sweet spot” of improving broadband and adequate disposable income to pay for services consumers want.  As a result, they have become the object of a “race to serve” on the part of video providers on every scale: • Traditional pay-TV operators are upgrading their VOD offerings and broadening device access to include smartphones and tablets. • At the same time, new entrants are seeking to construct the right content offerings at the right price to win over consumers.  Major global providers (Netflix and Amazon Prime) entered Asia during 2016, and immediately were confronted with the need to adapt a global approach to Asian realities (including lower price points). • A raft of regional Asian OTT platforms have expanded their offerings (including Viu TV, Hooq, IFlix, and Catchplay), alongside a plethora of locally-oriented offerings (like Hotstar, Dittotv and Voot in India, plus Toggle, Monomaxx, Doonee, USeeTV, MyK+, etc., in Southeast Asia.) These market developments have significantly ratcheted up the pressure on governments, who are seeing more and more consumers migrate to lightly-regulated (or totally unregulated) online content supply, and away from the heavily-regulated traditional TV sectors.   Governments are in a quandary – most do not wish to impede their citizens’ access to global information sources, but at the same time they see evident challenges to long-established policies for content acceptability, broadcaster licensing, taxation, advertising etc.   At the extreme, “pirate” OTT services happily locate offshore, respect no rules and meet no obligations of any kind (not limited to copyright authorization), all the while reaping millions in subscription and/or advertising revenues.  Local content industries are crying foul. This very unbalanced competitive landscape causes deep damage to network operators, content creators at home and abroad, and investors in local economies.  In general, it isn’t possible to subject online content supply to outdated “legacy” broadcasting rules, so alternative solutions have to be considered, including self-regulatory approaches (which can gain acceptance from legitimate OTT suppliers, if not the pirate scofflaws)...

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An opportunity for the Airbnb of Asia?
Jun15

An opportunity for the Airbnb of Asia?

In a week where taxi drivers around the world went on strike against Uber, and Airbnb announced an anticipated 120,000 visitor stays for the World Cup in Brazil, this post looks at the growing number of “collaborative consumption” startups in Asia and the legal and commercial challenges they will have to overcome to succeed in the region. What is “collaborative consumption”? Collaborative consumption (aka “the sharing economy” or “peer to peer”) is a broad term used to describe the shared creation, supply and consumption of goods and services. Typically it involves the use of technology platforms (usually the internet) to link supply and demand, enabling supply-side and demand-side to share resources and capacity in an efficient way. That’s the concept but it is perhaps best explained by way of example, with reference to arguably the two most disruptive collaborative consumption companies today: Uber and Airbnb. As most readers will be aware, Uber connects passengers with drivers in most major global cities, whilst Airbnb links people with temporary accommodation. If you’ve used either of those services, or any like them, then you’re already part of a new generation of collaborative consumers. “Hi, we’re ‘The Airbnb of…’” If you go to a startups event or incubator anywhere in the world, chances are you’ll have to wait all of five minutes before someone pitches their new startup idea to you as “the Airbnb of [insert industry that they think is about to be disrupted by their new idea]”. It looks like some people are getting tired of this pitch but there’s no doubt that we are still in the relatively early stages of internet-driven collaborative consumption. Although services like Uber and Airbnb are no longer used solely by tech-savvy early adopters as they were a couple of years ago, we’re still some way from the tech laggards booking their next holiday accommodation on Airbnb. Collaborative consumption startups in Asia Although the big US companies are making most of the headlines, Asia itself is in the middle of its own collaborative consumption revolution. Here are just a handful of the collaborative consumption startups making a splash in the region at the time of writing (hat tip to VulcanPost and TechinAsia for some of these): Food KitchHike is a Japanese startup that aims to let travellers experience food cooked by local people (usually in the cook’s own home); and Indian startup MealTango, and Malaysian startup PlateCulture, have a similar model.  P2P Accommodation Roomorama is an Airbnb competitor with its HQ in Singapore and global ambitions (albeit largely targeting the Asian traveller); and TravelMob is another Airbnb competitor based in Singapore – but it is specifically...

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Mapping the Social Commerce Revolution in Asia
Feb24

Mapping the Social Commerce Revolution in Asia

The convergence of social and e-commerce continues apace in Asia. More established e-commerce businesses, led by the likes of Alibaba and Rakuten, are investing heavily in social to maintain growth momentum and give them direct access to millions of users via social networks and messaging apps. One only needs to look at Rakuten’s $900 million acquisition of chat app Viber just last week, and Alibaba’s $586 million investment in the Sina Weibo microblogging platform last year, to see that e-commerce businesses are betting big on social. Across the way, social platforms are finally starting to monetise the retail opportunities that their platforms create. Alibaba’s Sina Weibo investment was seen as an effort to see off competition from its big rival, TenCent, and its messaging app WeChat, which is increasingly active in e-commerce and has a staggering 300 million users. In other parts of the region, fast-growing messaging apps like KakaoTalk and Line are partnering with retailers by offering official shopping channels, discounts and flash sales. Meanwhile, “social first” e-commerce startups are building their businesses right in the area of convergence between social and retail, whilst payment providers like Doku and service providers like aCommerce and Shopify are cashing in on all of this activity. Let’s look at some of the investments, acquisitions, partnerships and startups that are leading the social commerce revolution in Asia. Who? What? Social grabbing a piece of retail TenCent It’s no wonder that Alibaba is investing in social. A clear challenge is coming from its big Chinese rival, TenCent, and its WeChat messaging app, which has around 300 million users. In November 2013, device manufacturer Xiaomi managed to sell 150,000 units of its Mi-3 device in less than 10 minutes – exclusively via WeChat. And much more established businesses are also working closely with WeChat in the social commerce space. Chinese McDonalds fans can now pay for their meals via WeChat. Facebook, Instagram, WhatsApp Facebook is having a good deal of success with so-called “F-Commerce” in the region, taking advantage of the absence of global players like eBay and Amazon. Thailand is a good example. There are 24 million Facebook users in the country. Small and medium sized operators are using the platform to sell an ever-increasing range of products and merchants are now starting to invest in advertising on the platform. The company’s incredible $19 billion acquisition of WhatsApp will see it move into messaging apps and, one imagines, a broader range of social commerce opportunities. The acquisition also hit the share prices of the platform’s Asian competitors, like Line and WeChat. Line Japan’s Line messaging app, with its estimated 300 million users, is...

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The Premier League, Sponsored by…Asia?
Feb15

The Premier League, Sponsored by…Asia?

Asia’s interest in the Premier League is at an all-time high. A population of young, increasingly affluent and increasingly connected Asian fans are following the Premier League in their hundreds of millions. At last count, the Premier League had 820 million fans in Asia, spanning the length and breadth of the continent. Put simply, the Premier League has more supporters in Asia than anywhere else. Asian interest in the Premier League is not new. What is new, however, is the fact that fans in Asia have more money to spend, and more smartphones, tablets and PCs to watch football on, than ever before. The commercial opportunities created by this fanbase have not been lost on Premier League clubs or indeed on Asian brands and broadcasters. Cash-rich brands from Asia are pouring millions of sponsorship dollars into Premier League clubs. Premier League clubs are responding to the opportunity by bolstering their commercial teams to entice brands with increasingly innovative partnership opportunities. Asian broadcasters are in total spending more on broadcast rights than those in any other continent. This report looks at what is driving these developments, highlights some of the deals that have already been done and considers the challenges and opportunities that lie ahead on both sides of the negotiating table. Shirt sponsorships Let’s start with the shirt sponsors. It is fair to say that Asian brands are rapidly buying up the “shirt real estate” of Premier League clubs. Almost a third of Premier League clubs now have an Asian brand as their main shirt sponsor. The 2013-2014 season sees players from six of the 20 Premier League clubs stepping onto the pitch with an Asian brand emblazoned on their chest. The proportion is even higher (eight out of 23) if one includes Wigan and QPR, who were relegated at the end of the 2012-2013 but who continue to have an Asian brand shirt sponsor. Contrast this with the Premier League ten years ago, in the 2003-2004 season, when just one Asian brand was involved as a shirt sponsor, in the form of Chinese telecoms company, Kejian, which sponsored Everton. Let’s look at the deals that have now been done: Club Shirt Sponsor Country Industry Aston Villa Dafabet Cagayan, Philippines Betting and gaming Cardiff City Malaysia Malaysia Tourism Chelsea Samsung Korea Electronics Everton Chang Beer Thailand Alcoholic beverages Swansea City GWFX Hong Kong Financial services Tottenham Hotspur AIA (cup, full shirt sponsor from next season) Hong Kong Insurance Queens Park Rangers* Air Asia Malaysia Airline Wigan Athletic* 12BET Cagayan, Philippines Betting and gaming *Relegated 2012-2013 A growing menu of partnership opportunities on offer The days when shirt, perimeter fence...

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The week in Connected Asia
Dec11

The week in Connected Asia

Here is a quick round-up of stories from a busy week in Connected Asia. 1. China has the highest number of fast-growing tech companies. With 128 companies ranked in Deloitte’s Technology Fast 500 Asia-Pacific, China has emerged as the country with the highest number of fast-growing tech companies. China Communications Media Group, which is one of the largest mobile software platforms in China, was the fastest growing of them all. It has grown revenues by a staggering 266 times over the last three years. Taiwan, Australia and India were the other “stand-out” performers, although the tech sector across the region appears to be in fairly good health, despite the slowdown in China and sluggish economic growth in other parts of the world. 2. Amazon is said to be testing a cash-on-delivery business model in India. The Amazon drones made the headlines but the reported move by Amazon to test a “cash-on-delivery” model is one to watch in the e-commerce space in Asia. Consumers in India, particularly in more rural areas, are notoriously reluctant to make up-front payments via e-commerce platforms and this is a major challenge. Cash-on-delivery is far from a perfect solution though, for logistical, financial and legal reasons. First, it raises logistical issues (not least in collecting cash and dealing with rejected goods) that will need to be addressed by Amazon’s local delivery partner, India Post. Second, cash-on-delivery locks up working capital and exposes merchants to the obvious risk of “time-wasting” purchases that are ultimately rejected (although that risk does still exist to some extent with “cooling-off” periods in an up-front payment model). The shortcomings of the cash-on-delivery model are acknowledged but the hope is that it will build trust in e-commerce and that eventually consumers will move towards up-front payments. The fact that ever-innovative Amazon seems to be looking at the model suggests that it could be a long time before up-front replaces on-delivery in India. 3. Singapore’s “Do Not Call” register opens for business. The Asian data shake-up continues apace. On Sunday, Singapore’s new data regulator, the Personal Data Protection Commission, announced the opening of the “Do Not Call” registry. The “Do Not Call” rules under Singapore’s Personal Data Protection Act, which come into effect in January 2014, require businesses to verify with the registry that numbers are not listed there before engaging in direct marketing activities (voice calls, text or fax messages). Around 67,000 unique telephone numbers had been listed on the registry within 24 hours. From January, “Do Not Call” will be a new compliance burden for organisations to address. The remaining rules of Singapore’s Personal Data Protection Act (which impose obligations when it comes to the collection and...

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