SINGAPORE — Celebrating ten years of legitimate distribution in China, ESPN Star Sports (ESS) is optimistic about the future — but remains coy about profitability.
“The key to getting this far has been patience,” says ESS Managing Director Rik Dovey, “as it’s taken time for the operators in China to recognize the value of the product. They now have a much better appreciation of sporting rights’ worth,” he says. “China’s appetite for sport just keeps growing.”
Not that China pays the same for content as other markets. “With viewers in Shanghai paying just $3 per month for 50 channels, cable operators are limited in what they can afford,” says Dovey. “But our long-term approach is paying off in terms of both distribution and syndication deals.”
ESS’s distribution in China increased from 82 million to 127 million households in Aug. 2002, when English Premier League soccer bowed nationwide.
Deals have been struck with over 20 regional TV stations as well as national channels CCTV 5 and Hunan Satellite. However Dovey says this does not signal a move toward terrestrial transmission rather than pay TV.
“We’ve always pursued the cable and satellite route, and some properties will remain on pay TV.”
However the lure of nationwide distribution has also seen NBA basketball air on terrestrial TV and, according to Dovey, three or four other sports properties are set to follow suit.
With China’s lower rates for content, how does ESS expect to make money?
“Advertising revenues are still pretty marginal,” says Dovey, “but at least we’re now guaranteed all advertising goes through (and isn’t masked). If an ad doesn’t run, we’ll know within 24 hours.”
On an optimistic note, Dovey says the all-important local advertisers are beginning to see the real value of pay TV — and the audiences garnered for sports like English Premier League soccer.