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Tuesday, 10 April 2007
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Management and Leadership

Hong Kong entrepreneur sees interactive TV as sure-fire bet 

Robert Chua.

ROBERT Chua is only half joking when he says he launched the world’s first reality television show. Like the genre’s pioneering programmes such as Survivor, the Hong Kong media entrepreneur’s reality show also embraced a do-or-die theme. However, it took a rather different form: one of his television ventures hosted talk-show discussions about its own financial plight.

In 1998 Chua decided his Hong Kong-based satellite television channel, CETV, should take to the airwaves with its financial tribulations after it failed to secure rights to run on cable networks and sell advertising slots in China — a serious financial blow for the Mandarin Chinese entertainment channel.

The response to those broadcasts startled Chua. As he struggled to keep the channel going, money started to trickle in from viewers. The station’s struggle became a popular topic on Heart to Heart, a CETV talk show.

In all Chua estimates the station received HK$1m ($128000) in unsolicited viewer contributions, including two crumpled five-yuan notes (each worth about $0,60) from an elderly viewer in China. Ultimately, a sympathetic advertiser paid up-front for advertising worth $1m.

“We got calls of support from all over China and southeast Asia,” he says. “But thank God I understand TV. I started cutting staff and we survived.”

That episode — together with Chua’s earlier gamble to start CETV with his own money — was typical of the 60-year-old television producer’s knack for using every means at his disposal to secure both financial support and audiences for his ventures.

Now, eight years later, he is making a more concerted effort to share lessons in launching a business with his current project, The Interactive Channel (TIC).

Unlike with CETV, Chua says his objective this time is not simply to create a successful channel. He is just as interested in using TIC as a model to show broadcasters, especially in China, how to produce their own interactive programming. In return for helping them get up and running, TIC aims to collect licensing and royalty fees. “TIC is a laboratory,” he says. “It’s all tested and it works.”

TIC’s premise can be traced back to one viewer’s comment to Chua during CETV’s darkest days: “It’s not your station. It’s our station.” TIC believes viewers should contribute to and interact with its programmes.

Each day TIC broadcasts a variety of talk shows. The difference is that viewers can send in text messages or questions, which appear on the left-hand side of the screen. A control-room editor vets the incoming messages before they are posted for all to see — and for the hosts to answer if they wish.

Audience members who have web cameras or third-generation cellphones can also appear on screen to ask their questions in person. Across the bottom of the screen a slot is reserved for targeted advertising.

“This is the future of television,” Chua argues. “It will become the norm in a few years’ time.”

A self-confessed television junkie, Chua is qualified to make such predictions. He began his television career as a 17-year-old prop assistant at ADS Channel 7 in Adelaide, Australia, and four years later was producing one of the most popular programmes in the history of Hong Kong television. Enjoy Yourself Tonight, a five-day-a-week entertainment and variety show, debuted in November 1967 and ran for more than 20 years.

TIC, which broadcasts from a modest suite of offices in the heart of Hong Kong’s central business district, is carried on two Hong Kong cable networks, iCable and HKBN, which together reach 680000 households. When the station began trials in September 2004, iCable let it broadcast on overnight slots on its 24-hour traffic channel, which few watch in the small hours of the morning.

TIC launched formally in December 2004 and today produces six to eight hours of live programming a day, filling its remaining slots with repeats. In the afternoon it broadcasts Home Away from Home, a programme popular with Hong Kong’s housebound Filipino maids.

In the evening, the channel switches over to a mix of English and Cantonese talk shows.

Hong Kong’s various political parties have been quick to seize on the opportunity for exposure.

The Liberal party, a conservative, pro-business grouping, hosts a Liberals in Dialogue programme every Friday night.

Members of Hong Kong’s pro-democratic camps counter with Fanning the Flames and The Civic Night on Saturdays and Monday nights respectively.

Even Leung Kwok-hung, an independent legislator and all-purpose rabble-rouser, takes to the airwaves every Friday night.

Leung, however, a committed Trotskyite famous for his vast collection of Che Guevara T-shirts, recognises that football is far more popular than politics. So every Friday he hosts an hour-long preview of the coming weekend’s English Premier League matches and other European soccer action.

But as well as investing his programming and scheduling know-how into the venture, Chua has contributed an equally important resource: his own funds. To date, he has injected about $4m into TIC and is now casting around for investors.

Some of Chua’s friends have told him he is crazy for starting ventures with his own money. That is what other people’s money is for, they argue.

But it was just such a gamble that allowed him to start CETV.

In the early 1990s, he put down $400000 to reserve capacity on the Apstar satellite.

With access secured, he was able to round up $30m from southeast Asian and American investors, and CETV was launched in March 1995. “As a businessman I was stupid and crazy,” he says. “But without that (capacity) I had nothing to show potential investors.”

So for Chua, it seems only natural to be gambling millions on a new television venture at a time when most people are planning their retirements.

“I worked my guts out I enjoyed it so much,” he recalls of his career.

“It never seemed like work to me at all.”

Tom Mitchell. Financial Times

The long and winding road to a place on China’s airwaves

ROBERT Chua characterised CETV’s operating principle as “no sex, no violence, no news”.

While this made it palatable to China’s authorities, securing so-called “landing rights” in southern China proved to be a long struggle.

Viewers from China to Indonesia could capture CETV’s signal with satellite dishes after it launched in 1995. But by 1998 the station had still not secured government permission to broadcast on cable networks or to sell advertising slots in China, its biggest potential market.

Told by government officials that having a mainland partner would smooth the process, Chua dutifully signed up a Beijing-based consortium.

The consortium, however, did not deliver. “The money never came,” Chua says.

His back against the wall, Chua took to the airwaves — or rather his wife, Peggy, did, with her much better standard of Mandarin.

Appearing on a popular CETV evening talk show, Peggy Chua explained the station’s plight to its viewers. The audience sent in money, which was followed by $1m worth of upfront advertising. Robert Chua kept the station running long enough to seal a deal with AOL Time Warner, which bought an 80% stake in CETV in June 2000.

Prior to that, only Chinese viewers with satellite dishes could watch CETV. A formal agreement, however, was not signed until October 2001, a year after AOL Time Warner acquired its CETV stake.

Even after acquiring formal landing rights in 2001, though, Time Warner struggled to make CETV work. In July 2003, it sold its controlling stake to Tom Group, the Hong Kong-based internet and media company controlled by tycoon Li Ka-shing. Financial Times

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