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Astro Malaysia Holdings Out for New Audience Connections

When the first whistle blows on the World Cup in Russia on June 14, listed Malaysian media company Astro will kick off the biggest sports initiative in its 22-year history.

Coverage will run across every platform and device Astro can get its hands on, including a deal with Twitter — announced March 15 — to amplify match highlights from Astro’s coverage.

Unprecedented resources are going into making sure that the matches reach every human being in Malaysia, beginning with Astro’s existing 1.3 million premium sports subscribers, and then reaching out in myriad ways with multiple price points to the country’s entire 30 million population.

Sports rights are expected to drive Astro’s total content costs up to 36% of TV revenue in the current financial year to the end of January.

It is muscle-flexing with a clear purpose. Group chief executive Dato’ Rohana Rozhan says Astro is using the World Cup “as a huge reminder” of the platform’s reach and ability to serve every single Malaysian, on all devices. “The World Cup is a huge differentiator for us,” Rozhan says.

She’s well aware that Astro, part of Malaysian mogul Ananda Krishnan’s sprawling empire, needs to redefine and defend its place in a disrupted entertainment universe.

And she promises that the World Cup is just the beginning of a charm offensive to make Astro’s home proposition not only a global best, but also that it will recover the ground lost to high-impact global streaming services.

Astro has 5.3 million pay-TV subscribers and penetration of 73%. Most of its pay-TV household growth comes from free service NJOI. Average revenue per user is 101 ringgit ($26), driven by take-up of value-added products and services.

In urban areas, particularly, Astro commands about 90% of the main screen in the living room. “Now we need to make that experience second to none,” Rozhan says.

The tech refresh rolling out this year includes cloud-based functionality that will link all devices, and ultra HD transmissions for the English Premier League and movies. Among other new functions, subscribers will be given the option to rewind linear channels.

By the end of this year, Astro plans to roll out “the box that can talk,” promising to embed Alexa-like functionality into its set-top box.

Rozhan describes the next six or seven months as a “huge campaign to talk about how Astro is providing a truly premium experience.” Her aim is a series of “Aha” moments among customers that will, ultimately, reinvigorate subscription revenue.

Using Sky in the U.K. as her guiding star, Rozhan says, Astro is “going to knuckle down and make sure there is utility to all our boxes,” and, ultimately, to “reclaim our premium position in the market.”

The new campaign comes on the back of significant tech gains, including a 50% increase in connected PVRs in October over the previous year. Average viewing is 60 hours a week.

Rozhan’s other ambition for this year is to create more relevant entertainment environments for a wider range of demographic groups.

“It’s up to us to define those customer personas, especially in the premium space to know them better than anyone else and to provide them with a holistic experience,” she says.

Rozhan says the effort under way “will redefine the customer persona from cradle to grave, and provide for each and every one of them.” Wallet size and advertiser potential will be assessed and aligned with Astro’s media assets.

This translates into a deep focus on Malay-language content, which, like the World Cup, will be a fundamental differentiator. Seventy percent of Malaysia’s population is ethnic Malay.

“It will be the last bastion for us. This focus buys us an ability to lead by virtue of that content.”

The Malay/Islamic content effort informed last year’s joint venture with Malaysian publisher Group Majalah Karangkraf to create and monetize vernacular content across all platforms, including digital and on-air. Astro paid $25 million for its 51% stake in the venture, Karangkraf Digital 360. The Karangkraf deal gives Astro access to a combined 10 million monthly unique visitors.

The pay-TV platform carries 188 channels, including 72 Astro branded channels packed in-house and a full complement of international brands, such as bouquets from HBO Asia, Turner, Sony Pictures Television Networks Asia, A+E Networks Asia, BBC Worldwide, Fox Networks Group and Disney. About a third of the services are in HD.

Free service NJOI offers 29 TV channels and 20 radio channels. The pay tier starts at $33 for 127 channels.

Mobile platform, Astro Go, has more than 1.5 million registered users. Average weekly viewing time among active users for the nine months to end October last year was 197 minutes. This was a 49% increase over 2016.

Astro’s transformation also includes reworking long-held carriage relationships with international programmers, a move away from exclusive contracts, and a push for all content rights.

Astro’s view — not always popular with its channel partners — is that “we have to have the full suite of rights to over-deliver on our promise for premium,” Rozhan says. Anything else is “not much use to us.”

Through its theatrical production and distribution unit Astro Shaw, the group’s latest cinematic title, “Abang Long Fadil 2,” became the highest-grossing local movie ever in Malaysian cinemas with a box office gross of $4.64 million. Together with “Polis Evo,” “The Journey” and “Ola Bola,” four of the top five local movies to date are Astro-produced.

Astro’s content strategy also includes closer cooperation with its Southeast Asian neighbors. More than a decade after plans to launch Astro Nusantara, a pay-TV platform in Indonesia fell apart, Astro is reviving the concept of Nusantara. Drawing on cultural and linguistic commonalities between Assn. of Southeast Asian nations, the focus this time is building a pipeline of IP through programming alliances and co-productions.

The new slate of Nusantara titles include “Do[s]a”, which premiered on Feb. 14 in Malaysia and Brunei across all Astro platforms; a remake of Astro Shaw’s 2014 theatrical blockbuster “The Journey,” by mm2 Entertainment and India’s Wee Folk Entertainment; horror thriller miniseries “Sembilan”; Thai-produced “3 A.M. Bangkok Ghost Stories,” which aired last year; and “Door” with Manila’s Epicmedia Prods.

The regional initiative also includes linear channels such eSports channel EGG and Boo, an Asian horror brand launched in 2016. Astro also operates regional OTT streaming platform Tribe, which is available in Indonesia, Philippines, Singapore and Thailand.

Astro COO Henry Tan, who has been promoting the vernacular strategy for years, says homegrown services, such as Boo, fill a gap in the region not being serviced by anyone else.

“It’s a bit too Asian for others, but it’s home for us,” he says.

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