City&Country: Astro brings IPTV to homes

Just a few decades ago, the world in which we live today would have seemed very much like a science fiction novel. Information and entertainment are now literally at our fingertips. We can watch movies, TV shows and news on our laptop or mobile phone anytime, anywhere. And not too long ago, a man in Canada managed to track down and retrieve his stolen laptop in New York with the aid of the Twitter community.

There is no doubt that technology has changed the way we consume information and entertainment, as well as the way in which we connect. Proof of this is the rapid rate of digitalisation in Malaysia and the popularity of electronic gadgets such as iPads and MP3 players.

Technology is finding its way into many homes. Thus, it comes as no surprise that a digitally connected smart home is fast gaining popularity. “That’s the way to go. If you look at every developed country, digitally connected homes are everywhere,” says Liew Swee Lin, chief commercial officer of Measat Broadcast Network Systems Sdn Bhd/Astro Malaysia.

Nor can the fact that more and more people want easy and instant access to entertainment and information on the go be ignored. “People are moving beyond TV as a source of entertainment and information. Therefore, it is crucial for us to seek alternative ways to deliver content and for that reason, we have embraced Internet protocol television (IPTV),” says Liew.

Unlike traditional TV which receives signals sent over radio waves, IPTV delivers programming through broadband connection and allows the content to be streamed to not only your TV but also your computers and game console.

Liew explains that with IPTV, you can do a few things concurrently. “Imagine the father watching TV in the living room, the mother surfing the Net in one room and their children on the game console in another room all at the same time. It enables the family to be connected concurrently without having to compromise and restrict each other’s lifestyles.

“With the advent of technology adoption, urbanisation, more demand for quality products and services, our offering is going to be indispensable for customers,” she adds.

Liew says the number of IPTV subscribers worldwide has doubled since 2005. “In Asia, about 28% of households in Hong Kong have IPTV. In Singapore, South Korea and Taiwan, it’s over 20%. Fibre broadband take-up is also growing in Malaysia, and with Malaysia being digitally connected all the time, there is growing demand for IPTV.”

To cater for the demand, Astro launched Astro B.yond IPTV in April. The triple-play offering brings together multiplay of Astro channels in high-definition (HD), personal video recording (PVR) and video-on-demand through fibre-to-the-home (FTTH) broadband with voice.  This service is the next stage of
Astro B.yond, which was launched in December 2009 and offered HD and 3D channels as well as PVR.

The service, in collaboration with TimedotCom Bhd (TdC), allows about 320,000 Astro customers in high-rise dwellings who are currently unable to receive Astro B.yond services to do so and enjoy IPTV.
“Our agreement with TdC is to wire up to 730 selected condominiums, representing 167,000 homes by the end of the year. That is our target but the numbers keep growing,” says assistant vice-president of strategy and business intelligence Chu Young Lee.

At the present time, about 70 condominiums have been wired up, mainly in the Klang Valley and Penang. “For property owners and developers, this will increase the net value of their properties because it is future proof and that sells. It means that they are thinking ahead of time, and that benefits tenants who do not want a restricted lifestyle,” says Liew.

For IJM Land general manager for the northern region Toh Chin Leong, the decision to provide FTTH broadband service in The Light Waterfront Penang project was a no-brainer.

“We believe FTTH will be the norm for all residential and commercial developments in the near future, be it for work or household use. As a developer, we have always wanted to incorporate technology into our development as it can definitely add significant value to the property,” says Toh.

A fibred-up The Light, which is going for Green Building Index certification, will also send a message to IJM’s customers that the developer is gearing up for a new chapter that embraces technology in the industry, he adds.

A year prior to the launch in April, Astro started a pilot project in Mont’Kiara to ensure that the network was functioning well. Sunrise Bhd, the master developer of Mont’Kiara, was the first developer to offer FTTH broadband service, in partnership with TdC, to its properties in Malaysia.

Sunrise general manager of branding and community development Anne Tong says it is a constant for the developer to find new ways to enhance its value proposition to customers and residents through improved services and facilities.

“We try to achieve this via strategic partnerships to harness the latest technology and to promote innovative solutions to meet customers’ needs,” says Tong.

The pilot project and its subsequent launch have been a success, amassing about 350,000 upgrades from current subscribers and new sign-ups. Liew had expected the response as she believes the customers are excited about the prospects and curious about what it can do for them. However, she acknowledges that there are still many who want more clarity and are at the exploratory stage right now.

“There is still a degree of education that needs to be done. The younger folks or those who travel frequently overseas have greater knowledge of what IPTV and FTTH are. Others will have to take some time to understand how this works or know the difference between speeds,” says Chu, adding that this is also true of property developers and building managers.

Astro and TdC are currently working with both existing and new developments, and common questions arise. “Building owners and developers are concerned about inconveniencing the residents — the cost of not only wiring the buildings but also the electricity consumption, and whether it will be unsightly,” says Liew.

They need not worry, she adds, as the wiring is concealed so it will not affect the aesthetic appeal of the buildings and it does not consume any electricity.

As for the cost, Chu says that for new developments, it is actually minimal as the cost of fibre cable is the same as that for copper wires. “For high-end developments, this is a small, insignificant sum as it adds value to the property. As most condos in enclaves are very close to one another, imagine a developer finding that the condominium located just 250m away has FTTH while his does not,” says Liew.

For existing properties, there is zero cost to the owners and developers as TdC will bear the cost. “It is almost a no-brainer for developers and building owners to wire their buildings, considering the minimal cost and the value it can add,” she says.

At the moment, Astro IPTV service is mostly available in condominiums located in what can be considered exclusive areas, such as Mont’Kiara, the Kuala Lumpur city centre, Bangsar and George Town in Penang.

However, Chu is quick to point out that the company is not targeting only the high-end market, adding that while the 730 selected condominiums have a high Astro take-up rate, many mid to high-end condominiums have a centralised disc, resulting in their inability to receive Astro B.yond services.

“We also look at the profile of the residents. We find that most of the owners and tenants in these areas, especially in the newer developments, are people who would want a digitally connected lifestyle. These are fairly young people that are highly urbanised and are digital natives. There are also the upgraders; if they are upgrading their dwellings, they would most likely upgrade other parts of their lives too,” says Liew.

Not to be left out are the investors who have generally a mixed profile. Liew categorises them as a highly urbanised and largely international community that want to have connectivity.

The response from developers and building owners has been very positive as it is no longer a matter of cost but whether the developers and building owners understand the incremental value it offers, says Liew.

Property developers do extensive research before embarking on a project, which includes studying the community profile, household income and movement in the primary and secondary markets. “For a lot of them, it’s not just future proof, it is also an economic decision. FTTH can be a great product differentiator, and considering the residents’ profile and resale value, it makes sense,” says Liew.

However, there is yet to be an estimate of the value FTTH can add to a property as it is still in the early adoption stage. Liew believes the value will be reflected in the Home Price Index in another 18 to 24 months.

At the present time, the Astro IPTV service is only available in Peninsular Malaysia as extending the service to Sabah and Sarawak would require underwater cabling. This, however, does not mean Astro is ruling out extending its IPTV service to the two states.

“Our agreement with TdC is exclusive to the targeted 731 condos, but the IPTV market is growing. We are looking forward to tie-ups with other providers as they can also open up a new avenue for us,” says Liew.

Astro is looking into rolling out its IPTV service to single dwellings. It is conducting research to understand the targeted communities and the demand for IPTV. “If you think about it, we have six million households in Malaysia and IPTV has just begun its journey. Take 30% of those households and you have the reach we are aiming for,” says Liew.

This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 866, July 11-July 17, 2011