Television still Rules Filipino Households in Today's Digital Age
Despite new technologies and shifting viewing habits, TV continues to be the preferred viewing platform for Filipino households, with a 2017 research of Media Partners Asia showing that the Philippines saw the national TV penetration rate standing at 83%. There is immense opportunity for broadcasters and satellite operators to work together to capture not only the urban market, but also the TV market in more rural locations of the archipelago, where terrestrial networks remain unreliable.
Here are five key video trends illustrating how TV remains popular across the Philippines:
1. The digital switchover is underway
With about 54% of TV homes served by analogue terrestrial networks, the transition to digital TV is progressing slowly as the analogue switch-off has been set for 2023. The Department of Information and Communications Technology (DICT) in the Philippines aims to have 95% of the country’s households switch to digital television by 2023. The digital switchover is certainly good news for viewers as it ensures better reception quality, but it also brings with it a set of challenges, namely when it comes to deploying new ground infrastructure, which requires significant investment.
This is where Direct-to-Home (DTH) operators have a significant advantage; relying on satellite technology, they already bring the benefits of digital TV to their subscribers, and they can reach audiences wherever they are, without the need for any terrestrial network.
2. Direct-to-Home is gaining ground
While terrestrial TV remains strong in the Philippines, its market penetration has been decreasing over the years. Cable TV has also started to slow down so much so that the DTH is now the largest pay TV technology in the Philippines, with 78% of pay TV subscribers getting their feed directly via satellite.
3. Winning viewers’ hearts with more content
The video market in the Philippines is increasingly competitive as the market is no longer shared among pay TV operators who fight to attract the largest audience. Now, mobile operators and telcos are also entering the video market, cooperating with broadcasters and international players to provide bundled services and a widening array of content for their viewers. OTT and Video-on-Demand (VOD) providers are joining the video market as well. With so many new players in the video arena, it is becoming essential for pay TV operators to differentiate themselves with new, quality content for their viewers.
On the other hand, we see more and more content owners and TV channels willing to bring new programmes into the market to diversify the offer, for example, content specifically targeted at specific interest groups, such as youths, gaming enthusiasts, pet lovers and so on.
4. TV revenues to grow with advertising dollars
“Show me the money’” may be a well-known line from a 20-year-old movie but is also the best way to illustrate the growth potential of TV. As it is the most popular medium in the country, TV advertising spend is projected to jump from USD5.2 billion to USD9.2 billion between 2018 and 2024 . In 2024, TV is expected to account for 77% of total ad spend in the country. Free-to-Air (FTA) TV will remain the majority contributor to the total TV ad expenditure.
5. Pay TV market offers boundless opportunities
The pay TV market has grown in the past few years and will continue on a positive growth trajectory. According to Media Partners Asia (MPA), revenue from the pay TV market in the Philippines will grow from USD422 million in 2018 to USD 482 million in 2022, a healthy growth of USD60 million over a four-year period. Similarly, the proportion of pay TV subscribers will continue to grow from 22% in 2018 to 27% of all TV viewers by 2023.
The TV market in the Philippines continues to be an open field for growth, so long as content houses, broadcasters and everyone in the media ecosystem continue to evolve with changing viewer tastes and habits to provide them with what they want. TV operators must make the right moves to increase the attractiveness of their offer, for example, by bringing more channels and compelling content to suit a fickle TV audience in a sea of so many competing entertainment options.
This article was first published on The Asia Video Industry Report 2020