Piracy tipped to cost HK broadcasters US$24 million

PUBLISHED : Wednesday, 27 October, 2004, 12:00am
UPDATED : Wednesday, 27 October, 2004, 12:00am

The loss is a 66pc increase, with 78,000 pay-TV viewers using illegal decoders

Hong Kong's pay-television industry will lose out on US$24.33 million this year due to piracy, with 78,000 viewers - or one in 10 - using unauthorised decoders, according to a study.

The findings released yesterday by CLSA Asia-Pacific Markets and Cable and Satellite Broadcasting Association of Asia (Casbaa) represent a massive 66.29 per cent rise on last year.

This was an alarming indication of the piracy problem in Hong Kong and demonstrated a lack of proper protection of intellectual property rights, Casbaa chief executive Simon Twiston Davies said.

'The situation is not getting better. But it could get better,' he said.

The only consolation was the estimated lost revenue to the industry from satellite overspill - where viewers illegally tap into pay-television signals from other regions - dropped 16.01 per cent to US$576,000.

The cost of pay-television piracy to regional governments in lost taxes, licence fees and other revenues was estimated to reach US$152 million, according to PricewaterhouseCoopers, which contributed to the study.

The study found the aggregate cost of pay-television piracy in the Asia-Pacific rose to US$970 million from $874 million a year ago. The market was estimated to be worth $14 billion.

India dominated regional piracy numbers with a loss of US$564.59 million due to a developed grey market as legal pay-television operators are banned from collecting subscription fees.

Thailand's loss was US$140.8 million with 1.1 million users having access to unlicensed service. Philippines ranked No3 with a loss of $70.44 million, driven primarily by a jump in the number of detected unauthorised cable viewers.

'Pay-TV piracy is a direct attack on governments' efforts to create an international perception that they run a robust [intellectual property] environment,' said Simon Dewhurst, a director and head of media and entertainment investment banking at CLSA Asia-Pacific Markets.

'There is not one market here where an improvement in understanding of the issue among governments and regulators won't help improve the problem,' he said.

He added that the piracy problem would affect reinvestment in developing content and products.