NEW DELHI: Animation channel Animax has exceeded Sony Picture Entertainment (SPE)'s first year expectations with a current cable & satellite distribution base of 16 million in Asia with much traction seen in India on the One Alliance bouquet.
"To SPE also expects that it would be able to breast the target tape for year-ending 2005, which is at the 20 million mark, with a further addition of 400,000 subscribers by the year end, according to Todd Miller, managing director of Sony Pictures Television International, Asia and Sony Pictures Entertainment's (SPE) network channels in Asia.
Miller, who interacted with the Hong Kong based research and analysis firm Media Partners Asia (MPA) sometime back, to discuss the success of Animax and action channel AXN in Asia, feels that the costs for Animax are scalable since it leverages the existing AXN infrastructure.
This gives Animax the ability to provide five unique and dedicated programme feeds in Asia (Hong Kong, Japan, Taiwan, South-East Asia and South Asia, including India)
in a cost-effective manner.
But SPE is not looking at a quick break-even, which will be several years away because of the considerable upfront investments that have been made and would be made to provide high customisation. Still, Miller feels that this
is in line with typical economic models of pan-regional cable & satellite programme networks.
Research conducted by Nielsen in Indonesia reports that within half a year, Animax has become the No. 1 service among all international channels on cable MSO Kabelvision, with 7.9 per cent share of viewers.
Though the current business model of Animax tilts towards subscription, Miller, during the interaction with MPA, expressed the hope that Animax would move towards a dual revenue stream over a period of time.
At present, the SPE strategy is to secure distribution amongst households, then build on advertising. Miller said that viewers tend to be heavy consumers (more than
eight hours per week) who will definitely pay for the channel, and even switch cable operators to get the
service.
Korea is a market that SPE is looking to expand into for Animax and AXN. However, the challenge is to work out the economics while meeting the country's broadcast requirements. Under current regulations, AXN cannot participate in the Korean ad market as a local programme provider and replicate the programming format of movies, series and reality shows that make the channel so popular in Asia, Miller told MPA. For Animax, there are restrictions on Japanese content. So we (will) have to thoughtfully
navigate these issues.
AXN is now fully distributed in South and Southeast Asia (31 million households) with double digit growth rates, an equal balance between subscription and advertising revenue streams and has moved past breakeven, Miller said.
Strength in ratings is maintained through continual investment in first run and original programming.
According to Miller, SPE recognises the importance of customised services and introduced a dedicated Hong Kong/Thailand feed earlier this year, which has resulted in improved performance in the markets.
