Television services are reducing service fees as they face stiff competition among themselves and with OTT (over the top) TV.
With 14 million TV subscribers in 2017, the total revenue of the pay-TV market was VND7.5 trillion.
In 2016, Vietnam had only 12.5 million subscribers, but the revenue was high at VND12 trillion. Five years ago, television services had revenue of VND5.8 trillion with the number of subscribers just half of that in 2017.
In 2014, SCTV, one of the best known television services, had 2.8 million subscribers and earned VND3.6 trillion in revenue.
In 2017, the number of subscribers increased to 4.5 million, while revenue decreased to VND3.42 trillion.
Analysts say the current situation is the result of the price war which began in 2014.
In that year, big players in the pay-TV market, including VTVcab, SCTV, AVG, VTC, HTVC, Hanoicab, VNPT, Viettel and K+, all rushed to restructure service packages and cut service fees to scramble for subscribers.
The most expensive service package of K+ in 2013 had a subscription fee of VND300,000 a month.
In 2016, K+ provided one service package at the fee of VND125,000. With a fee reduction campaign, K+ increased its number of subscribers from 600,000 in 2014 to 1 million in 2017.
Commenting that the price war is ‘driving television to an abyss’, analysts noted that the monthly subscription fee have dropped to VND20,000 at times.
As a result, some television services have reported losses and have had to change hands.
The challenges for broadcasters are expected to be even bigger in 2018, because they will not only compete with each other, but also with OTT TV.
In 2017, K+, SCTV, VTVcab and Viettel began developing OTT pay-TV service. K+ has myK+Now (VND125,000 a month), while SCTV has SCTV VOD (VND30,000-50,000 and VTVcab has VTVcab ON (VND40,000-50,000).
SCTV’s deputy CEO Luong Quoc Huy said the shifting to OTT service is a big threat to the pay-TV industry, especially in countries with high speed and reasonable internet fees.
He said to attract subscribers, Vietnam’s television services need to be more creative in producing content to attracting viewers, especially youth.
K+, FPT Telecom and MobiFone have begun investing in online internet-based TV products.
Meanwhile, the service fee of online TV packages is nearly the same as the fee of traditional TV services.
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