[Satellite News – 5-22-08] Australia’s Austar United Communications Ltd. is another digital satellite pay-TV operator in the Asia-Pacific region expecting strong growth throughout the next few years as consumers in the region
    Australia is a maturing market, and Austar likely will continue to add 60,000 to 70,000 subscribers a year, putting the operator on pace to hit 1 one million subscribers in the next five years, John Porter, Austar’s CEO told Satellite News.

    “As a country with great television usage history, there is a demand for Australian/U.S./British programming,” said Porter, who in March was re-appointed CEO for the next four years. “There is no reason why Australia should not blow right through 50 percent penetration over the next five to six years. It is a question of us getting the value equation right.”

    The launch of the company’s MyStar personal video recorder service in February will help Austar maintain if not improve the pace of its growth, said Porter, who expects 10 percent of the company’s customers to adopt the service in the first year. “We think it is a real point of difference in the market,” he said. “It really takes our service from not just being about pay-TV versus free TV, but more about the way you use the television.”

    Austar may also alter its pricing strategy as it looks to appeal to a wider range of customers, Porter said. “We are looking at different tiering strategies,” he said. “We are talking to programmers about the additional capacity that will be available on the new satellite in 2009 and trying to determine how much of that capacity should be committed to HD (high-definition) versus additional [standard-definition] channels that could be tiered,” he said.

    The launch of HD services is the next step in Austar’s subscriber push, with 2009 a likely target date. “We are part of Liberty Global,  which owns 51 percent of our company,” Porter said. “There is a universal view within the Liberty Global universe that it is the future of our service and we will look to incorporate the HD tuners probably by about mid-2009.”

    However, Porter admits the business model for selling HD services is yet to be defined and is not an easy roadmap to follow, particularly for an operator like Austar which does not have huge amounts of subscribers. “This is a difficult question because programmers and operators are still finding their way around the HD economics,” he said. “ I don’t think anybody has found a way to make a lot of money out of HD yet. I have seen early models coming out with a lot of fees associated with migrating channels to HD. That is not something we are prepared to do. We are investing in the hardware and other things. They are the ones that need to invest in the content. But as that is not happening, that is going to be a severe barrier on how much HD programming we can put on if every programmer thinks they are going to get some kind of super premium for selling us HD content.”