Media : A Star Rises in the East : Hong Kong-based Star Television, the first pan-Asian network, has seen astounding growth.

By CHRISTINE COURTNEY

May 11, 1993 12 AM PT

SPECIAL TO THE TIMES

HONG KONG —

Satellite television’s potential power first became clear to Daniel Ng, general manager for McDonald’s in Hong Kong, when his teen-age daughter started spending hours watching Music Television, better known as MTV.

“Young people often have very short attention spans, but MTV attracted my daughter and she continued to watch it for quite some time,” Ng said. “Her interest convinced me that MTV was onto something, and that it was time for McDonald’s to become a part of it.”

Now, spurred by Ng, McDonald’s is one of more than 360 advertisers reaching Asia’s booming consumer markets on Hong Kong-based Star Television, which was launched in 1991 as the first pan-Asian network.

The growth has been phenomenal. In February, Star TV reported that 11,360,180 households can view its programming in 38 countries--a threefold increase from July, 1992.

Bookings for advertising in 1993 are already greater than last year’s total revenue. Among the advertisers are Audi, Canon, Coca-Cola, Hennessy, Levi Strauss, MasterCard, Mobil, Motorola, NEC, Nike, Panasonic, Pepsi-Cola, Reebok, Sony, Sharp, Shell and Toshiba.

To serve its widening audience, Star beams five “free-to-air” channels 24 hours a day from the AsiaSat 1 satellite. All the viewer needs is access to a satellite dish or receiving unit that delivers the satellite signal to the home.

Programming includes news from the British Broadcasting Corp., a sports channel, MTV and an entertainment channel, all broadcasting in English. The fifth channel broadcasts in Mandarin Chinese. In fact, Star estimates that its largest viewing audience is in China, about 4.8 million households.

But McDonald’s, like many companies, initially took a wait-and-see approach before joining Star TV as an advertiser.

“(Two years ago) there were few who believed pan-Asian broadcasting could be successful,” said Arnold Tucker, executive vice president of Star TV. “The cultures and languages of the region were too diverse, government restrictions on media were too severe and there were virtually no cable systems or home satellite dishes to receive or distribute the programming.”

Today, there are thousands of cable companies in Star TV’s 38-nation satellite “footprint” whose primary business is relaying the network to their customers.

“Star TV has forced multinational corporations to re-look at the way they are advertising their brands in different markets in the region,” said Alan Fairnington, president of J. Walter Thompson’s Asia-Pacific advertising office in Hong Kong.

The flood of companies targeting an emerging pan-Asian consumer class has caused advertising expenditures to soar. Asia Market Intelligence reports that spending on cinema, poster panel, print and television advertisements in the region reached $45 billion in 1991.

Moreover, other broadcasters are waking up to the changes in Asia and rushing to enter the regional market.

For example, Cable News Network, the Atlanta-based news and information satellite network, plans to open an Asian production studio early next year, with Hong Kong and Tokyo being the leading contenders as the site for the facility. And in the past year, CNN has opened bureaus in Bangkok and New Delhi, bringing its total number of Asian bureaus to six; opened sales offices in Hong Kong and Singapore, and moved onto additional Asian satellites to strengthen its potential viewership.

And Turner Broadcasting, CNN’s parent company, will open an advertising sales office in Hong Kong this June.

“From 1991 to 1992, our advertising revenue in Asia increased 200%,” said Kay Delaney, executive vice president for Turner Broadcasting International’s advertising sales. “I don’t expect another 200% increase this year, but it could reach well over 100%.”

In February, government-owned Australian Broadcasting Corp. launched Australia Television International on Indonesia’s Palapa B2P satellite, whose footprint covers eastern India, southern China and all of Southeast Asia. Tele-Communications Inc., Television New Zealand and Business News Network Ltd. announced they will launch Asia’s first satellite business channel in 1993, and a Thai businessman announced plans for a satellite television station aimed at the Indochina market by the end of this year. Japan is also considering a supranational television service.

And Star TV is starting to feel the pressure.

“I think we are coming to a time when all these things could come together as a force against us,” said Julian Mounter, chief executive and president of HutchVision Ltd., Star TV’s parent company. “And so, what we are trying to do is to create another window and extend our lead another two years by launching our AsiaSat 2 satellite, by getting broadcasters away from Indonesia’s Palapa satellite and by starting our pay-TV service.”

Mounter said agreements have been signed with four companies, including program suppliers, that will enable it to have as many as six pay-TV channels operating by April, 1994. He said the programs will include English- and Mandarin Chinese-language movie channels, a business channel, a children’s channel and possibly a documentary channel and an entertainment channel. And with the launching of its second satellite, Star TV will be capable of broadcasting as many as 100 channels.

“Pay-TV using cable television systems allows governments to actually censor the television programs, which will be advantageous to countries like Malaysia and Singapore where Star TV’s free-to-air service is banned,” Fairnington said. According to Star TV, government regulations in those two nations prohibit private ownership of satellite dishes. But in other nations, where local television is regulated but people can own satellite dishes, the free-to-air service does allow broadcasters to evade some government regulations.

For example, Hennessy cognac and United Distillers have used Star TV to target Taiwan, where the government limits advertisements for imported liquor on local television.

By broadcasting across eight time zones, Star TV is also able to target its programming and advertising to a country’s prime time, thus allowing companies to penetrate certain markets.

“I think the bottom line to all of this,” said Star TV’s Tucker, “is that countries in Asia are learning how to live with the technology more and more.

“But there’s no book that you can lift off the shelf and follow because most of the book’s pages are blank,” he adds. “We’ve written maybe three to five chapters of a 30- to 40-chapter book.”

A Boom in Broadcasting

More than 11.3 million households in 38 countries can now view Star TV’s programming. Here is a partial breakdown: KUWAIT

January 1992: 10,000

January 1993: 12,780 SOUTH KOREA

January 1992: 15,000

January 1993: 18,945** THAILAND

January 1992: 9,000

January 1993: 24,517* INDONESIA

January 1992: 14,335

January 1993: 36,211 PAKISTAN

January 1992: 15,000

January 1993: 60,300 UNITED ARAB REPUBLIC