ASTRO ALL ASIA NETWORKS plc
ASTRO ALL ASIA NETWORKS plc
http://www.astroplc.com/
--Owner:
ASTRO listed on Bursa Malaysia in October 2003. Major shareholders of the Group include the Usaha Tegas Group (42.7%) and Khazanah Nasional Berhad (21.6%), the investment arm of the Malaysian Government.
--Briefing
ASTRO ALL ASIA NETWORKS plc (ASTRO) is the region’s leading cross-media operator with direct-to-home satellite television services in Malaysia, Brunei and Indonesia. It is also the leading commercial radio broadcaster in Malaysia and a major publisher of TV guides and lifestyle magazines. ASTRO has formed joint ventures in other countries to launch new broadcasting, multimedia and Internet services. The Group has strategic alliances with leading software developers and content producers to jointly develop both technology and content to provide satellite-delivers, broadband, IP enhanced multimedia and interactive services over multiple platforms across the Asia Pacific region.
ASTRO’s subsidiary, MEASAT Broadcast Network Systems, has a 20-year exclusive licence for satellite direct-to-home (DTH) transmission in Malaysia. Astro, our subscription TV service, currently broadcasts 55 channels to more than 1.93 million subscribers, or some 35% of television homes. Through a joint venture, ASTRO also distributes these services in Brunei. The DTH service utilises high-powered KU band transponder capacity on the MEASAT system. The addition of a third spacecraft to the MEASAT fleet later this year will allow ASTRO to significantly expand its current bouquet of services in Malaysia and Brunei, and to the region.
The Group now operates eight FM terrestrial radio stations in Malaysia, including the top-ranking stations for all the key Malay, Chinese, Indian and English vernacular demographics. These stations cumulatively reach more than 10 million listeners a week or 62% of all radio listeners, and command over 79% of the radio industry's advertising expenditure. In addition, it also packages 17 music channels in six languages for distribution over its DTH platform. The Group also provides studio infrastructure and airtime sales and programming services for two radio stations in Kolkatta, India and is now looking to introduce this business model into other markets in the region.
Through subsidiary Celestial Pictures, ASTRO has all rights to the collection of 760 movies produced by Shaw Brothers from the 1950s through the 1990s. These films, which have never been exploited beyond their initial theatrical release, are being digitally re-mastered and are the foundation for its pay-TV Celestial Movies Channel, and a global content distribution business spanning more 40 territories in Asia, Europe and the Americas. In addition to the Shaw titles, Celestial Movies also features the best of Chinese and other Asian films and is watched by more than one million viewers in Malaysia, Brunei, Indonesia, Singapore, Hongkong, Australia, Mainland China and Thailand.
Leveraging on its multi-lingual skills and experience, the Group is also actively involved in content origination. During FY2005, Astro produced about 1300 hours of in-house content in the key Malay, Chinese, English and Indian languages, with a further 5,000 hours of subtitling, and to a lesser extent, dubbing. Tayangan Unggul and Astro Shaw, the Group’s film entertainment units, are Malaysia’s leading film producers with award-winning films to their credit. The Group also publishes TV Guides and lifestyle magazines in Malaysia -- including the country’s highest circulation magazine, Astroguide -- and in Hongkong, through a joint venture with Television Broadcasts Limited (TVB). The Group also produces animated content through its subsidiary, Philippine Animation N.V Group, Philippine’s leading animation studio.
The Group provides interactive TV services and aggregates and distributes other multimedia content to a variety of users through the many communication and mobile devices available today. The Group also offers broadband content through its portal, Astro.tv. ASTRO has a 25% stake in a joint-venture with MAXIS Communications, an affiliate company and Malaysia 's leading mobile operator, to own 3G spectrum and provide 3G services.
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生意重点:
(1) a 20-year exclusive licence for satellite direct-to-home (DTH) transmission in Malaysia,
(2) 80+% 营业额来者电视订户. 10+%来者广告.
(3) 电视订户超过2MILLION. yearly increase is 20,000~30,000, the trend is gradully weaker.
Malaysia Population : Jun 2007 estimate, 27,122,000,
30% Chinese = ~8 million, since Chinese is majority of subscriber, this market share is coming to saturation.
8% india,
50+% Malay.
(4) Major cost comes from Content, although early infrastructure capital expiditure is huge.
Cost is quite stable regarless of revenue, cusomers.
(5) Growth stratergy:
Demostic:
----More Malay, India lang- Programme Production, try to exploit more pentration into this population.
---- More channels allowed by new-expanded capicity from Measat-3 sateline.
---- Subscription Fee Hike.
International:
---- Indonesia, try to compliance to goverment's..., to make business development on track.
----India, enter a new market in form of a partnership as the local dominant India program content producer.
(6) Ratios:
--EPS ~ 160M/1932M shares = ~ 8.3cts,
--PE ~ 50,
--P/B ~ 4RM/ 0.95RM = ~ 4
--ROE =(Net Income/Revenue)*(Revenue/Assets)*(Assets/Shareholders’ Equity)
ROE = 160M/2224M * 2224M/3000M * 3000M/1847M = 160M/1847M
--Current Ratio = Total Current Asset/ Total Current Liabilities (i.e., CA/CB?)
Current Ratio = 1657M / 961 M
--Debt-To-Equity Ratio = Non-current debt / Equity
Debt-To-Equity Ratio = 217M / 1847M
--CAGR ?
Business Mode:
The company is a high-CapEx at early stage, than high growth & high cash in middle stage, and then stable high cash flow (less growth) in third stage (limited by population).
Now, the company is in the later middle stage, and is going towards the third stage in domestic market (Malaysia).
So, expandison to oversea could partially shift the company to 1st stage, and then, if successful, becomes a bigger growth company.
So, now, all depends its venture to India and Indonesia!!
Risk:
(1) Technical Failure.
(2) Loss in India and Indonesia
Valuation:
If, If we could consider Malaysia Business alone, the CFF is coming to 600M, per share ~30cts,
It you time it by 15, it comes to 4.5RM
...................
How to valuate?
1 comment:
Mobile TV in Asia Report
ABOUT THIS REPORT This report was commissioned by the Cable & Satellite Broadcasting Association of Asia (CASBAA) and was researched and written by the digital research agency Tomorrow. Its objective is to assess the current state of Mobile TV in the Asia region, as well as exploring the factors necessary for its future success. In forming our views in this report, we conducted interviews with the leading executives responsible for shaping the regional direction of Mobile TV.
In addition we collected an archive of video material of consumers directly interacting with mobile video products in a range of individual markets. Along with this executive summary, CASBAA will deliver to its members both an expanded version of this report with further detail on local case studies as well as a market insight video.
Mobile TV is at the crossroads
On one hand, a significant number of countries across Asia are on the brink of deploying commercial mobile broadcasting services. On the other, the advertising and subscription models necessary to make those services a profitable reality are still far from developed.
Expectations remain high. Analysts are nothing if not bullish, with worldwide Mobile TV audience projections ranging from 120 million (Juniper) to 488 million (Gartner) within five years. The problem is - while those numbers may tell you ‘how big’, what they don’t tell you is ‘how do we get there?’.
There are no easy answers to that question.
Until very recently, most of the debate around Mobile TV has focused on technology and standards. However, having the right platform in place is only part of the equation. Over the next eighteen months, operators, content owners and technology providers will need to co-ordinate to create integrated ecosystems in every launch market in order to achieve the single most important consumer milestone - ease of use.
Every ecosystem will be different, because Asia itself is not a homogenous market. There are significant differences across the region both in consumer income levels, as well as domestic infrastructure, spectrum availability and access to technology. While there might be millions watching mobile broadcast in Japan and Korea, in other emerging markets like India and Indonesia – the vast majority of phones are still in black and white.
For anyone interested in investing more in this space - the critical question is knowing when to act, and what the right engagement model should be. To address that issue that we have organised the insights from our research into a simple checklist, designed to explore what the DNA of commercial success in the Mobile TV space might look like.
The Checklist The 10 essentials
1. THE NETWORK
Mobile video takes a lot of bandwidth. And the more people that are watching at any one time, the more difficult that becomes if you are using a conventional telecommunications network.
The reason for that is simple.
Telephone networks were designed for one person talking to another, not one person talking to everyone else at once. Or in other words, broadcast.
Its possible to stream content on an individual basis, but that places strain on the network. A typical 3G network, for example, will be capable of streaming video to about 6 users per cell. Another way of looking at that is one person watching mobile TV in a unicast cell is roughly equivalent in data to about twenty people talking. Not surprisingly then, having the right kind of mobile video distribution platform in place often requires two distinct networks.
The first should be purpose built for mass distribution. Depending on local market conditions, the broadcast network might be based on DVBH, MediaFlo, satellite or terrestrial DMB or even some variant of WIMAX. The choice of technology is not as important as the ability for content owners to distribute a variety of channels, in a high quality viewing experience even in peak load situations.
The second type of network will typically be unicast - designed to facilitate on demand services. In the immediate future, this network is most likely to be based on 3G or 3.5G technology, and will allow the streaming or download of content on an individual subscriber basis.
2. EASE OF USE
The consumer experience of Mobile TV has to be simple and easy to use. Watching TV on a phone should be no more challenging than watching it in a living room. In our research, we found dramatic differences in the ways that operators approached the navigation and organization of content. Video that is hidden deep within pages of menus, requiring multiple clicks to access is not a compelling content experience. In comparison, Mobile TV services in Korea allow for easy switching of channels and access to a mobile EPG. There are a number of factors that contribute to the user experience of Mobile TV:
• Navigation and interface design
•Content organisation and packaging
• Service integration and consistency across different handsets
• Content and channel info made available through a mobile EPG
3. THE ECOSYSTEM
Having a healthy Mobile TV ecosystem means that the integration between content providers, network operators and device manufacturers is sufficiently robust that it results in both a viable commercial model and a seamless service experience for audiences. Having the right ecosystem in place typically involves resolving up front a variety of issues relating to both technology and as well rights management. This will often require a consortium model that includes all the necessary stakeholders.
There are four aspects of a healthy Mobile TV ecosystem:
• The device • Middleware
• The delivery platform
• Content and rights management
An example of a relatively sophisticated media ecosystem is Apple iTunes.
Apple combined attractively designed music and telecommunications devices (iPod/iPhone), with consistent middleware to allow users to manage their content assets (iTunes), with a universal delivery platform (Internet), and finally a large selection of well priced music and video content (negotiated deals with music labels and TV studios).
4. DEVICES
Its essential that consumers have access to a range of well designed, appropriately priced devices that suit either specific use (watching TV) or combined use (communications or navigation).
In a number of early Mobile TV consumer trials, a consistent theme was the dissatisfaction of survey respondents with the first generation of mobile video devices. Cumbersome, with poor battery life and confusing navigation - handset design was a major factor in negative consumer sentiment toward embracing future services.
Design is not the only issue. In many emerging Asian markets, handset costs are also a significant factor. 3G was slow to take off in the Phillipines, largely due to device pricing. It may happen again. You can launch a Mobile TV subscription service for only US$10 a month, but if the only device that can support your service is a handheld that sells for about US$500 - you may slow your adoption rate.
5. COVERAGE
Mobile TV coverage needs to be wide, deep and consistent.
Achieving this generally requires more than just a powerful broadcast transmitter, but also a plan for consumption in office buildings or in subways.
One of the reasons that the subscription Mobile TV service in Korea has been able to win subscribers over a rival free service, is that they have installed relays in train tunnels to ensure consistent coverage and good reception during commuter travel times.
6. REVENUE
When it comes to collecting revenue from consumers there are three issues that matter - pricing, billing and transactions.
Pricing of Mobile TV services needs to be transparent, tiered and tailored to local market conditions. In our survey of regional operators, we found a growing awareness that data charges are perceived by consumers as a barrier to media consumption on their phones. However expect change to be slow - mainly because its not an easy shift for telcos. Flat rate pricing requires a rethink of both business models and also the re-engineering of backhaul networks.
Billing is another challenge. In markets such as Malaysia and the Phillipines, the majority of users are on prepaid accounts. Pay TV provider Astro discovered the problems that entails if the average top up is 15R, and your service costs 20R. They devised an alternative billing strategy to avoid defaults. Astro’s solution was to implement ‘ bill chunking’, which levies 5R every week for 4 weeks rather than a single lump sum.
The final issue is transactions. If premium SMS, ringtones, and mobile ecommerce in Japan are any indication - there are considerable revenue opportunities if you can manage to integrate Mobile TV promotion with micro transactions.
7. REGULATION
There are two types of regulation that require careful attention.
The first relates spectrum. Setting up new mobile broadcasting infrastructure in a local market will generally require new spectrum, which in turn involves anticipating the planning and allocation procedures of local authorities.
Even in markets where spectrum is available and assigned, the second type of regulation that is likely to arise concerns content and broadcast licensing.
Uncertainties about mobile broadcast licenses in the Philippines, and content provision in China are examples of factors that can slow the development of Mobile TV services. The commercial viability of the free T-DMB service in Korea, despite its advanced device and delivery platform, is also restricted by regulations on the placement of advertising.
In the end, its a question of balance. There needs to be a sufficiently flexible regulatory regime, that whilst delivering certainty on the use of spectrum and technology, doesn''t overly restrict either the ability to distribute content or commercialise audiences through advertising.
8. CONTENT
As has been the case in the subscription television industry, content is a major driver of consumer adoption. Local language and premium sports content have been consistently successful in Mobile TV deployments.
Premium sports content has been a familiar strategy in the launch of Mobile TV services. In Europe, DVB-H was launched in Italy during the 2007 Soccer World Cup. France are adopting a similar strategy in 2008. In Asia EPL was the focus of StarHub’s Mobile TV proposition, while Korea’s TU Media has used their baseball programming (MLB) to successfully differentiate their subscription service from its free to air mobile broadcast competitors.
One mitigating factor, however, is the availability of the same content on other platforms. In Japan, for example, consumer adoption has been slow relative to Korea mainly due to the fact that the service comprises of a simple retransmission of existing free television programming.
9. ADVERTISING
Mobile advertising remains a sleeping giant, and at present highly contingent on three crucial variables:
• Mobile TV audience size
• Effectiveness of mobile ad serving and targeting technology
• Sophistication of the local ad market
To date, markets which have launched free services dependent on advertising have struggled due to the relative immaturity of the three factors listed above.
Despite an audience of approximately 3.14 million, it is believed that the six operators free T-DMB service in Korea have lost between US$22 million and US$33 million since launching in 2005. Further, most of the operators we interviewed in the Asian region believe that their current mobile video audiences are too small at present to warrant advertising sales.
The mobile phone represents a highly personalised advertising delivery channel. And unlike conventional TV, the target audience is an individual not a household.
However, as yet, we don’t know how valuable this market is going to be. Google CEO Eric Schmidt has already said that mobile ads should be at least twice as valuable as non-mobile ads.
He may be right. A personal device that combines communications, rich media playback and also GPS capability that provides location data adds up to a potentially very powerful advertising opportunity.
That is, when the local market knows how to both value and buy it.
10. LIFESTYLE
The final point on our checklist relates to how we live. The layout of a city like Hong Kong, with its high urban density and lots of tall office buildings causes problems for radio signal interference. In contrast, the flat spread of Beijing is almost perfect for mobile broadcast.
Populations which commute to work every day by subway typically require broadcast relays to be installed to ensure consistency of reception, while those cities where people drive may find themselves using integrated navigation/television devices.
Every city has a context - a pattern grid of existing media consumption and usage. Understanding this provides insight into how quickly new services like Mobile TV will become embedded into the fabric of everyday life.
THE WILDCARD
There is a caveat to this list. And it is simply this – the Internet. Although the Slingbox may be too complex for the average consumer it is a powerful reminder of the power of the Internet as a work around to the best laid plans of media companies.
It also why we need to routinely evolve our thinking. When all media is digital and IP based – you can no longer really think about individual screens as distinct mediums. The screen in a someone’s living room may be bigger than the one in their pocket – but ultimately it is part of one big interaction between consumers and content brands, all delivered by the same network.
If there is anyone that already understand this - it is the new generation of Asian media consumers. Born in the nineties, they already spend their afternoons downloading entertainment in Internet cafes in China or exchanging virtual items on Cyworld in Korea. In their world, there is no piece of content not easily available to them - anytime, anywhere or on any device they choose.
This new generation is unlikely to approach Mobile TV with the same mindset as us. Media is a fluid concept for them. They talk about it, share it, and use it to represent who they are. On networks like Facebook, Mixi or QQ they even use common tastes in entertainment as a way of meeting each other.
It is perhaps ironic that when it comes to Mobile TV, so many of us already assume that the most interactive device ever invented – the mobile – will in the hands of the new generation become a passive broadcast device.
If we really believe that Mobile TV is the future, it may be the worst kind of mistake to design it based on ourselves.
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