HD changes loom for Korea
EmptyMIPTV REPORTS: Programming trends in key markets:
China | Hong Kong | Korea | Australia
Complete MIPTV coverage
SEOUL -- With HD digital cable, HD IPTV and other next-generation services finally rolling out in Korea, the TV industry is poised for big changes to the business.
Most of those changes are still in the future tense, however, since for the moment terrestrial and cable TV are still how the vast majority of Koreans watch television. With the Beijing Olympics coming up, Cheil Communications, Korea's leading advertising agency, is predicting a 5% jump in general ad spend.
However, as usual for the past couple of years, most of that jump will come from cable TV and new media. Cable television ad spend increased 23.5% in 2007 to top $850 million, after jumping 38.1% in 2006 (according to the Cheil report). Online advertising is surging even faster, up 30% in 2007 to reach $1.2 billion (after growing 37.4% in 2006).
Terrestrial TV ad spend, in contrast, rose just 1.6% in 2006 to reach $2.36 billion (2007 terrestrial estimates are not yet available).
Terrestrial TV is home to local TV programming, while cable TV is where foreign imports (mostly Hollywood) thrive. Once again, "CSI" and its various spinoffs dominate cable ratings, with Orion Cinema Network (OCN) broadcasting the program more than 12 hours a week.
But with IPTV hotter than ever thanks to recent changes to government regulations, the new platform could transform broadcasting.
SK Telecom-owned Hana TV is still the largest IPTV service in Korea, with just over 800,000 subscribers, followed by KT's Mega TV with 300,000, but other groups such as Internet portal Daum Communications have said they intend on offering IPTV soon.
On the other hand, Digital Multimedia Broadcasting, a technology which allows people to watch TV on portable devices and cell phones, even when traveling in excess of 100 kph, has hit a wall recently. TU Media's Satellite DMB service has plateaued at 1.3 million subscribers, and faced with $270 million in losses since its launch in 2005, it recently laid off about 30% of its workforce.
Another 5.3 million people use Terrestrial DMB, but since T-DMB service is free, broadcasters have had a difficult time generating revenue.