Television industry still belongs to oldtimers

Luas Samudera, Contributor, Jakarta

The introduction of several new private TV stations -- Trans-TV, Lativi, TV7 and Global-TV -- earlier this year has changed the map of local TV.

The top three are still in the hands of the oldtimers: Indosiar, RCTI and SCTV, although the new Trans-TV has taken a small portion of the viewership, endangering the position of fourth ranked TPI.

Clearly, the three stations -- Trans-TV, Lativi and TV7 plunge into already crowded general entertainment and "supermarket" television of the mainstream channels, while Global-TV joined hands with MTV Asia to run a 24-hour music channel, some programs were even moved from the former MTV partner ANteve. The latter has introduced several new live formats since the change of its ownership.

In terms of ownership, local TV saw several dramatic ownership changes. Front runner Indosiar, whose 49 percent shares were sold by the Indonesian Banking Restructuring Agency (IBRA) to PT TDM Asset Management. Skeptics suspect former owner Salim group is behind the firm which was set up only three months before taking over the majority ownership of Indosiar. But no further explanation on the issue from the publicly listed firm was available. IBRA, and its subsidiary PT Holdiko Perkasa, which controls all assets of the former Salim conglomerate, still holds 8.26 percent of shares in the station, while 27.74 percent shares are held by PT Prima Viasualindo and 15 percent by the public.

ANteve changed management which significantly revamped its programming lineup. It was reported to have been totally sold to Capital Management Asia, this firm is believed to be Bakrie's Singapore-based firm, from former shareholders' PT Bakrie Investindo (60 percent) and PT Hasmuda Internusa (40 percent) since March 2002. Bakrie's heir-to-the-crown Anindya Bakrie is now holding the position as the president director of the firm. Spokesperson Soraya Perucha said CMA is a consortium of several local companies, but she refused to reveal the total investment involved in the deal.

Third-ranked SCTV's holding company PT Surya Citra Media (SCM), which earlier took over shares of PT Datakom Asia in SCTV, has sold its 20 percent or 375 million shares, to the public at an initial price offering 1,100 rupiah in early July. Lead underwriter CLSA Indonesia said 70 percent of the shares were bought by foreign financial institutions.

SCM said the proceeds will be used largely to pay off a loan to a local bank worth Rp 230 billion, and Rp 150 billion rupiah is earmarked to expand SCTV's facilities and the remaining will be allocated to strengthen corporate capital. After the IPO, PT Abhimata Mediatama and PT Mitrasari Persada respectively own 40 percent of the shares.

However, a company, PT Citra Gemilang Sejahtera (CGS) in November called on the management of the Jakarta Stock Exchange to temporarily suspend trading of SCM shares.

CGS, believed to be owned by Surya Paloh of Metro-TV and Media Indonesia daily, claimed that Datakom was still holding 47.5 percent of the shares in SCTV. CGS has acquired Datakom's credit assets held by IBRA amounting to Rp 180 billion. These assets are believed to include 47.5 percent of the shares in SCTV and an option to acquire 25 percent of Indosiar for Rp 25 billion.

Another player Bhakti Investama is pouring its energy into the television business under its Bimantara holding company. During a shareholders' meeting in early May, Hary Tanoesudibyo was appointed as the president director of Bimantara. Earlier, under its subsidiary PT Panca Aneka Selaras, Bimantara acquired 70 percent of new free TV licensee Global-TV. Two other stations, RCTI and round-the-clock news channel Metro-TV are already under Bimantara's umbrella, which owns 69.8 percent and 25 percent, respectively.

Two television stations -- TPI and a local JTV in Surabaya- almost fell as the first victims of the cut-throat industry. Publicly listed IDD monopoly holder Indosat has threatened to claim bankruptcy against TPI because of its failure to pay off on convertible bonds worth Rp 150 billion due last October. After negotiations, Indosat agreed to extend the terms for another two months.

Earlier this year, police in East Java closed down and barred entry to the transmission facilities of JTV, citing illegal operations. No further explanations were available on what the station could do to resume the service the following week.

* Local TV

With the growing pressure for more regional autonomy since the fall of the Indonesian government under former president Suharto, several Indonesia provinces have launched or in the process of launching their own local television stations.

The oil-rich region of Riau has introduced Riau-TV in addition to an existing local station Pekanbaru-TV which hit the air last year.

And so the same story goes for Amuntai-TV in the South Kalimantan town of Hulu Sungai Utara, Makassar-TV in South Sulawesi, Pupuk Kaltim-TV and LNG-TV both in East Kalimantan. East Java province has several stations such as JTV in Surabaya, Eskape-TV in Banyuwangi, Lumajang-TV in Lumajang, WM-TV owned by Widya Manggala university in Surabaya. There is also one in Central Java Pemalang-TV and Papua-TV in Papua.

* Pay TV

Despite relatively stagnant growth of several existing operators, others still see the light at the end of the tunnel in the pay TV industry.

One company, Global Vision, is still optimistic about getting a bite and launched the service in July 2002.

Other firms such as PT Cipta Skynindo, reported a surprising number of 30,000 new subscribers for its Chinese channels during its two years of operations. Unplink feeds are transmitted from Taiwan.

The existing cable operators have to face the fact that the Indonesian market is not used to pay TV yet. PT Broadband Multimedia, which operates Kabelvision, has yet to reach their ideal plan of 100,000 subscribers by the end of this year.

The first pay TV group here was Indovision, owned by Datakom, and it saw the number of its subscribers hover in the neighborhood of 30,000 in the past three years. The only change is Datakom Asia changed hands from Peter Gontha to PT Bhakti Investama of Hary Tanoesudibyo.

Armed with more existing facilities to exploit, TelkomVision provides subscribers with more choice to access its pay TV services using fiber optic technology in conjunction with its parent company's Telkom-1 satellite.

* Advertising Expenditure

There is no official figure yet on this year's advertising expenditures, but according to the Indonesian Advertising Agency Association (P3I) chairman RTS Masli, this year's gross advertising is estimated to grow by 30 percent to reach Rp 12.6 trillion. He said 60 percent of it (Rp 7.5 trillion) would go to television stations.

* New Broadcast Law

One of the hottest issues of the industry this year was the introduction of a controversial Broadcast Law to replace the outdated 1997 Broadcast Law. The law will take effect after being signed by the president. The approval of the law by the legislature in November, amid protests from television and radio owners, could drastically change the industry. Only the government owned and operated television station, TVRI will be able to air nationwide. While private stations will air locally and their reach to other provinces is allowed under a condition that they team up with a local firm.

The new law also allows foreign ownership to a maximum of 20 percent and acknowledges the community television.

One of the controversies is the formation of a new Indonesian Broadcast Commission (KPI) which sets broadcast guidelines, provides broadcast permits, oversees implementation of broadcast regulations and hands out sanctions for evildoers. This commission is believed to be the new super powerful offspring of the now-defunct information ministry under former president Suharto. Former president Abdurrachman Wahid dissolved the ministry in the spirit of free press, democracy and Reformasi, but apparently the current administration felt it was necessary to regain control.

The new law is expected to influence the trading of shares related to stations such as SCM of SCTV, Indosiar, and Bimantara, owner of RCTI, Metro-TV and Global-TV.