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Digitisation opening the door for development of Taiwan’s TV industry

MUMBAI: Taiwan’s plans to restructure its regulation of the cable-TV industry was the focus of a day-long seminar in Taipei this month before 100 industry leaders, government officials, academics and foreign experts.

NCC Chairman Howard Shyr told delegates at the opening session that NCC saw the advance of digital technology as opening the door for development of Taiwan’s TV industries. Great changes continue to sweep the communications industry, he said, with convergence of the telecommunication and the broadcasting sectors. In this environment, NCC was seeking to use the trends for the benefit of Taiwan’s consumers and producers.
“Ensuring opportunities for varied services while improving customer satisfaction and increasing revenue are key issues,” he said.

Casbaa hosted the seminar together with Taiwan’s NCC, which is considering options for the restructuring.

During the day-long discussions, representatives of the international pay-TV industry made clear their view that Taiwan’s regulatory approach was in serious need of reform and liberalisation. With the government-imposed cable price cap fixed in place for 14 years, they said there was little incentive to develop new content or invest in new technologies for Taiwan’s TV market.

Academic experts at the meeting concurred. Prof. Jessica Chou of Yuan Ze University noted that Taiwan’s digital development still seriously lagged other markets in Asia, and had only recently begun to catch up as some competition was introduced to the over-regulated environment.

Prof. Yoosung Yang from Chung An University in Seoul observed that cable TV in Korea plays the same important social role as it does in Taiwan. The last two Korean administrations had implemented regulatory restructuring, Prof. Yang said, introducing new competition and removing the cable price cap in that country. As a result, consumers had more choices and cable industry revenues were up despite declines in subscription levels.

Experts on Singapore, Hong Kong and the UK noted that their cable industries had developed rapidly because they did not face a government strait-jacket on rates. A speaker from a major international content company commented that 10 years ago, there were similar restrictions in place in a few other Asian markets (notably India and Korea), and now they have moved forward and it was only Taiwan that had not liberalised its rules. He urged NCC to move forward rapidly, and boldly, to reform the cable-TV regulation.

Prof. Yang noted that the Korean government was heavily focused on the free-to-air terrestrial broadcasters, and regulatory expert Nigel Mukherjee from Ogilvy and Mather observed that all governments have “public service” goals for key sectors of the TV industry. In Hong Kong, Korea and Singapore this was met by terrestrial broadcasters, he noted. But as cable transmission in Taiwan plays such a central role in TV consumption, the proper focus for regulatory obligations and even rate controls there was on the bottom basic tier of broadcast channels. Higher tiers should not be regulated, consistent with the approach in other leading markets. The current law was too sweeping, constraining the whole analogue cable bouquet. It could not be justified on consumer protection grounds and was a real constraint to industry development.