Taiwanese incumbent Chunghwa Telecom’s Multimedia-on-Demand (MOD) IPTV service has been through some tough times this year, with its subscriber take-up slowing significantly and the company still unable to access many of the country’s most popular cable-TV channels.
But the company should get a lift from a deal, announced on Sept. 20, it has struck with US online-video giant YouTube for the Google-owned outfit to give CHT access to its application programming interface (API) and authorized content on the MOD platform.
Starting in October, MOD subscribers with the latest-generation MOD set-top boxes will be able to access YouTube content via their TV sets. About 150,000 of MOD’s 1.16 million subscribers will initially able to receive the content, and CHT is planning to gradually extend availability to the rest of its subscribers.
Although the YouTube move is by no means a game-changer in Taiwan’s pay-TV market, it does provide the MOD service with a much-needed shot in the arm by creating a significant point of differentiation between MOD and dominant cable-TV MSOs’ largely analog services.
Although the arrival of the free-to-use YouTube does not present an immediate opportunity for CHT to boost ARPU – which at just NT$150 ($5.10) a month is only 25% of that generated by the cable MSOs – it does make the MOD service more attractive to subscribers. This is important, because if CHT is unable to dislodge cable MSOs as the primary TV connection in subscriber homes – a nearly impossible task without a level playing field in the content market – then it has to be able to make itself an attractive “secondary” TV connection in the home.
Bringing YouTube onto the MOD platform should enhance the MOD product and will help – at least partially – to reignite subscriber interest in the service and help it reach its goal of having 1.3 million subscribers by year-end, some way short of CHT’s original 1.5-million-subscriber target.