• Thu
  • Sep 18, 2014
  • Updated: 4:45pm
CommentLetters

Not enough ad revenue to pay for five free TV stations in Hong Kong

PUBLISHED : Thursday, 28 November, 2013, 3:54am
UPDATED : Thursday, 28 November, 2013, 3:54am

I refer to the report ("Winners and losers as ad spend up 65pc in 5 years", November 18).

Just how did media monitoring firm admanGO come up with the ridiculous figure of HK$99 billion for last year's total ("across all media") Hong Kong advertising spending? It's not possible.

They gave a disclaimer, saying it was based on published rate cards and the figures had not taken into account the discounts given. Why not? Could they not make an educated guess of the discounts?

Surely they should know how big some media discounts are for its advertising space, with "package" discount rates and some barter/free adverts.

With TV ad spending representing an estimated 43 per cent of Hong Kong's total ad spending of HK$99 billion, it means TV share is about HK$43 billion.

If that was true, it would support many more than five TV stations. Sadly this is not the case.

If TVB managed to secure only about HK$3 billion of advertising spending, where did the other HK$40 billion go? Surely not all to ATV, Cable TV and Now TV; between them, they generate no more than HK$800m.

What is needed is a good estimate of the actual annual net TV revenue, instead of the ridiculous published rate cards.

I estimate net annual TV advertising revenue to be HK$4 billion to HK$5 billion, but my peers from local TV stations say it's HK$3.6 billion to HK$3.8 billion at most. This figure supports the government's reason for not granting more TV licences. TVB has taken the major portion of HK$3 billion. Let's be generous and assume there is HK$4 billion to HK$4.5 billion ad spending. Is that enough to support three or four stations?

To ask the government to increase TV advertising airtime would result in more disruption to programmes, with commercial breaks every 10 minute. That would drive more viewers to the internet, where most shows are free of commercials.

I strongly believe Hong Kong cannot support five free-to-air television stations.

What I fear most is that without a decent budget, they will produce degrading and tasteless programmes that will erode our family values and society.

Robert Chua, Mong Kok

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This article is now closed to comments

tinglong.chan
Sorry, I am afraid I cannot agree with you. Even someone on the street is going to set up a business with no prospects, can anyone say he is not allowed to do that?
We, as a hongkonger, are supposed to enjoy freedom in most perspective. You or the government do not have any powers to deprive the rights of others.
I really hope you can be deprived of all your rights in Hong Kong, then you may write a totally different opinion and understand what should be aware of.
honkiepanky
1) The pool of advertising revenue is not fixed. If TV quality were higher, people would spend more time watching TV.

2) The effect of increased competition is to raise quality, not lower it.

3) Even if the market can only support a limited number of licensees, there is no reason to have the government (rather than consumers/the market) pick winners
sfadams
None of this analysis, even if it is true, explains why it was the most exciting, and (potentially) most innovative station which had to be excluded.
dynamco
Chua " I estimate net annual TV advertising revenue to be HK$4 billion to HK$5 billion, but my peers from local TV stations say it's HK$3.6 billion to HK$3.8 billion at most. This figure supports the government's reason for not granting more TV licences"
Whereas the real number:
www.scmp.com/comment/letters/article/1366610/letters-editor-november-27-2013
Clarifying station's ad revenue
TVB is a listed company
For the record, the total turnover for TVB in 2008 was HK$4.407 billion, of which HK$2.346 billion was from Hong Kong television broadcasting.
The total turnover for 2012 was HK$5.448 billion, of which HK$3.167 billion was from Hong Kong television broadcasting.
Winnie Ho, assistant controller, corporate and community relations department, TVB Limited
IF THEY HAD DECENT PROGRAMMING INSTEAD OF REPEATS MORE PEOPLE WOULD SPEND MORE MONEY ON ADVERTISING ON A POPULAR CHANNEL
Compete or fold
 
 
 
 
 

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