Smithi, ambitious goal.

Popular music channels MTV and VH1, which recently left the UBC network, have joined an alternative cable package operated by the Smile TV network to compete for local viewers.

Ong-art Prapakamol, deputy CEO for commercial operations at UBC-True, cited changes in consumer viewing behaviour - specifically the surging demand for Thai pop music and documentaries - as the main reason to stop broadcasting MTV Thailand and VH1.

He said that as a response to the new trend, UBC had added three new channels devoted to documentaries: Explore 1, Explore 2 and Explore 3. The arrival of the two new music channels Ma Jung and True Music was said to force the cable operator to reduce the number of music channels for fear of programmes clashing.

Vilasinee Chivanond, managing director of Media Communication Network Co, the Thai owner of MTV Thailand and Smile TV Network, called the break-up a result of inconclusive business negotiations. She said, however, the deal benefited both parties, because MTV wanted to move from an exclusive audience of almost 500,000 households to a mass audience base.

MTV and VH1 said the move represented their new business model after the five-year exclusive contract with UBC ended on Tuesday. The termination was announced on Tuesday evening, and before midnight both channels faded to black.

UBC enjoys a monopoly on cable television services in the Kingdom, being the only major operator with more than 400,000 subscribers.

Smitthi Bhiraleus, general manager of Music Television Networks Co (MTV Thailand), said the Smile TV network would offer an eight-channel package direct to both individual viewers and small community cable operators.

Besides MTV and VH1, the package will include Nickelodeon (children's entertainment), Moviemania (movies), Popper (pop culture), Rakthai TV (luk thung music), Panorama 07 (documentaries) and World Fashion Thailand (fashion).

He said individual customers could subscribe to the entertainment programmes directly at home through the installation of a direct-to-home (DTH) dish and set-top box. Individual customers need to buy a smart card for the set-top box to view the programmes. They can view the programmes from now for free for at least a month.

Smitthi said that with the new business format, the company could increase viewership for MTV, VH1 and other entertainment programmes in its package from about 500,000 households subscribing to UBC to more than a million households in the first 12 months. Each household would cover about 3.5 individual members on average.

Smitthi said the company would focus on satellite channels at first, in order to make all of the programmes in its package recognised by local viewers, before expanding to other broadcasting channels like IPTV and broadband.

Vilasinee Chivanond, managing director of Smile TV Networks, said the royalty charged to cable operators would be different, based on their subscriber numbers. The smart card will also be available for individual viewers for about Bt200 and Bt300, valid for one month.

"We expect larger revenues will come from sponsorship in the near future once we enjoy a large viewer base," she said.

Earlier, MTV and VH1 were exclusive to the UBC network. The new "non-exclusive" model has been used successfully by MTV in China and South Korea to expand viewership.

"The new business model is aimed at serving mass viewers who would like to watch good-quality programmes but cannot afford the high-priced premium-package programmes on UBC," said Smitthi.

"This move will help us transform ourselves into a content provider and move our entertainment content through many channels that more viewers can access," he said.

He said there were now about 300 local cable operators serving more than 2 million households. There were also over 1 million households that have installed their own DTH satellite system.

DTH is an encrypted transmission that travels directly through a satellite to the consumer, who receives it through a small dish antenna. The encrypted transmission is decoded by a set-top box.

"Our programme content will be free-to-air for the first month, and then we'll charge the cable operators a monthly royalty fee," said Smitthi.

Kwanchai Rungfapaisarn

The Nation