RS, GMM Grammy expect profits from new digital-TV channels in first year

Corporate January 29, 2014 00:00

By Watchiranont Thongtep
The Nat

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Two music and entertainment giants are getting ready to launch their digital television services in April. Both companies expect to see profits from those businesses in their first year of operation.

GMM Grammy grabbed two licences for variety channels, in high definition (HD) and standard definition (SD), at last month’s spectrum auction by the National Broadcasting and Telecommunications Commission (NBTC).
“It is quite clear that GMM One satellite channel will be transformed and rescheduled into an HD variety channel on the digital terrestrial TV platform in April, while the other one is developing a concept and programming,” GMM Grammy chairman Paiboon Dumrongchaithum said yesterday. 
He added that the SD channel would target a wider mass audience than the HD one. 
To ensure both of its digital terrestrial TV channels make an impact, the company will spend Bt1 billion for content production, using its subsidiary TV, music and film production houses Exact, Scenario, GTH, and A-Time Media, and even its pay-TV business GMM Z. 
Exact and Scenario, owned and operated by soap-opera director Thakonkiat Veerawan, will produce situation-comedy and drama programmes, while film producer GTH will also make drama series. 
Paiboon said his company was also looking at partnering with other content-production houses. 
Likewise RS, which secured a licence for an SD variety channel, revealed yesterday that it aimed for Bt80 million in profits from Channel 8 in the first year.
RS chief executive officer Surachai Chetchotisak said that once Channel 8 was available on the digital terrestrial platform, the company hoped to widen its audience base on top of existing cable and satellite TV viewers. 
“The media and broadcasting businesses have now become key drivers for the company,” he said.
According to AGB Nielsen, Channel 8 garnered the highest ratings among satellite TV channels. With this strong base, Channel 8 should bring in Bt850 million in revenue this year, a 70-per-cent increase from the satellite-only operation last year, Surachai said. 
Pornpan Techarungchaikul, chief operating officer at RS, said that to boost TV ratings, the company was prepared to spend Bt300 million on production of entertainment, news and soap-opera programmes throughout this year. 
RS expects to generate Bt5 billion in revenue this year. Of total income, 73 per cent will come from its media business, 13 per cent from music distribution and 14 per cent from show business. It will continue to focus on those three key businesses. 
In its media business, the company projects Bt3.65 billion from digital free-TV Channel 8, satellite TV, broadcasts of Spanish La Liga and World Cup Final soccer matches, and business from its three radio stations. 
In the music business, Dam Nana, chief financial officer at RS, said he expected to see a 15-per-cent drop in revenue to Bt650 million as a result of a recession in the music market.
The company’s show-business sector, which is based on its music business, is aimed at bringing in Bt700 million.