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SCMP Reporter

Sources say sales-network expansion could bring in another 50m yuan

Asia Television (ATV) will extend its advertising sales reach in Guangdong province from four cities to nine.

Industry sources say the  expansion  could result in additional sales of up to 50 million yuan a year.

Yaguang Media, a joint venture between ATV and Southern Television Guangdong (TVS), currently sells advertising in four Guangdong media markets: Guangzhou, Jiangmen, Foshan and Zhuhai.

It will add Shenzhen, Donguan, Zhongshan, Huizhou and Zhaoqing to its sales network, the sources said.

Under the terms of ATV's revenue-sharing agreement with the Guangdong Administration of Radio, Film and Television (Garft) - reached late last year - Hong Kong's No2 terrestrial broadcaster was given permission to sell advertising in the nine media markets. But hard bargaining by local cable operators, which previously pirated the ad slots, delayed Yaguang Media's full roll-out.

The sources said Garft had recently approved the five-city expansion and they expect details to be finalised next month or in October.

Under the plan, Yaguang will sell advertising time for two commercial breaks in every hour of broadcasting - the 15th-minute and 45th-minute slots - from 7am to 2am.

ATV chief operating officer Yu Tung-ho declined to comment on details of the agreement.

'We are working from city to city to make the model work,' he said.

One media buyer said: 'Guangzhou and Shenzhen are the biggest television advertising markets in Guangdong.'

'It would be a great leap forward for ATV to extend [its sales] to Shenzhen.'

ATV's sales operations in Guangdong are being carefully watched by dominant local broadcaster Television Broadcasts (TVB), which is currently negotiating its own revenue-sharing agreement with Garft.

'The [ATV] deal was carefully constructed as it will become the blueprint for TVB's,' said one industry source.

TVB's Cantonese channel - TVB Jade - enjoys a dominant ratings share of about 60 per cent in Guangdong.

As it previously did with ATV's programming, TVS blocks out the advertising embedded in TVB's feeds and re-sells the slots to local advertisers in a process known as ad-splicing.

TVS was expected to have earned 200 million yuan from pirating TVB's ad slots last year and 100 million yuan from ATV's.

Guangdong's television-advertising market is estimated to be worth three billion yuan a year.

ATV chief executive Chan Wing-kee has estimated that his company's revenue-sharing arrangement with Garft would boost turnover by 'hundreds of millions' of Hong Kong dollars.

ATV and TVS should benefit from new regulations limiting their domestic competitors' commercials to no more than 15 per cent of air time between 7pm and 9pm.

'Basically [Yaguang Media] can run as many commercials as possible during the 15th and 45th-minute breaks on ATV programming,' a media buyer said. 'The extension of  rights across the province would help TVS compete with other provincial broadcasters.'



ATV to expand Guangdong reach