1. 1 The Making of Broadcast Media Disorder: A Political Economy Perspective Hamilton Cheng, PhD. Public Television Service a Taiwan Response at CWM 2004 East Asia Region Media Mission Seminar 26th February 2004

2. 2 Taiwan TV Market Profile (1) Population: 22.2 million Number of TV Households: 6.1 million Cable Penetration: 80% Terrestrial (over-the-air) Penetration: 15-20% Satellite Penetration: less than 0.3% (30 thousand homes at most)

3. 3 Taiwan TV Market Profile (2) Terrestrial broadcasters 5: TTV, CTV, CTS (incl., NOU), FTV, PTS MSOs: Easter Multimedia, China Networks System Other Cable Operators 6 Satellite DTH: Pacific Digital Media, 3 others

4. 4 Taiwan TV Market Profile (3) TVR%: Cable 60% Terrestrial 40% Analogy Cable Channel: Over 100 Cable Monthly Subscription Rate: US$17.40 Digital Cable (proposed in 2003): install Euro 41 STB Euro 140, monthly rent 6 deposit 42 Channel: 20 PPV, each monthly Euro 3-9, only 6 Basic free Subscribers less than 30 thousands

5. 5 Taiwan TV Market Problem Cable : Vertically Dominated Platform Bundling Strategy: between content and transmission Unattractive Digital Bouquet (keep analogue service intact by basic tier price) Terrestrial: Market Failure Consideration--Economic Scale supported by Advertising revenues Unbalanced Scale between PSB and Commercial Broadcasters

6. 6 What ’ s the origin ‘I will go back to the house I left.’ And comes and finds it vacant, cleaned orderly. He then goes out to bring along with him seven other spirits worse than himself, and they enter and live there. And the final condition of that person (place) is worse than the first. So it will be with this wicked generation. (Matthew, 13: 44-45)

7. 7 The place was vacant Martial Law was lift in 1987 Terrestrial kept hold by Nationalist Party, Military and Bureaucracy Cable TV got expanded island wide informally The entry of cable channel without economic regulation--deregulation (supply control)

8. 8 Bring along with Along cable penetration reach to its climax Group commercial channels together Lack of public fund pouring into and without fencing around public sphere Over private interests oriented and cross- subsidization between systems and channels too many channel with too few market share (0.01-5% TVR)

9. 9 over100 5 62 4 4 7 38 5 82 6 48

10. 10 The Disorder is unfolded Basic tier relies on economy scale of ad Driven by the advertising market--catching eye balls and sell it later Churning out sensational, pornographic, rumor, scandal, peep-hole view Organization competes for short-term survival rating game ignores media product Audience without screening mechanism receive all

11. 11 Finding a solution (1) Defensive strategy (passive) Implement conditional access in cable Economic control in place between supply and demand Licensing the cable channel by quality and quantity evaluation Enforcing the program standard steering

12. 12 Empowerment Strategy (active): Building an competitive platform of digital terrestrial broadcasting service Introduction to the Project of FY 2003 reengineering over-the-air broadcasting improving reception and quality bring quality entertainment, information, and education together within limited channels strengthen public service broadcasting by expansion Finding a solution (2)

13. 13 Digital Broadcasting Multiplex Operator in Southern Taiwan to be expanded elsewhere Mobile Reception Broadcasting System converged audiovisual with information Multimedia Home Platform (MHP) Production and Testing Project for digital content Three Items of Annual Plan

14. 14 Thanks for Your Attention and Comments