ATV appoints telecom veterans to top posts New chiefs signal change of direction for broadcaster

05 December 2008


By Frederick Yeung
© South China Morning Post Publishers Limited, Hong Kong

Asia Television yesterday appointed two high-profile telecom executives to senior roles, in the latest attempt to turn around the struggling broadcaster that has lost more than HK$5 billion since the 1980s.

Linus Cheung Wing-lam, the former chief executive officer at Cable & Wireless HKT, was named executive chairman, while Ricky Wong Wai-kay, chairman of Hong Kong listed City Telecom (Hong Kong), will be chief executive officer.

The two men are expected to change the focus of ATV's programming to attract wealthier viewers with new lifestyle shows and documentaries. That could make it a more serious rival to TVB, whose popularity is based on a steady supply of drama series. ATV is also seen as more pro-Beijing than TVB.

Mr Wong's appointment raised the question of cross-media ownership as City Telecom also operates an online video service with about 150,000 subscribers.

But it does not breach government rules because City Telecom does not have a television licence.

"As City Telecom does not own a terrestrial or pay television licence, Mr Wong's appointment does not breach the rule on the limitation of cross-media ownership," a government spokesman said.

Mr Wong, who is also controlling shareholder of City Telecom, denied ATV would seek a back-door listing through his company. ATV has been trying to list on the Hong Kong stock exchange since 2003 but has failed to meet profitability requirements.

Yesterday's move, however, has sparked speculation there could be some amalgamation of content.

Vivek Couto, executive director at Media Partners Asia, said Mr Wong's appointment was a good one as he "has many good ideas".

"Both ATV and City Telecom may co-operate on content distribution through the latter's broadband network," he said.

This is the second major management shake-up at ATV after the Cha family, local property developers, took more than a 50 per cent stake in the broadcaster in April last year.

The Cha family appointed former Television Broadcasts executives Louis Page and Ho Ting-kwan to top management roles last year to lead reforms at the broadcaster. Both Mr Page and Mr Ho resigned recently on speculation they had failed to deliver on improving ATV's operations.

ATV launched a new logo in October last year and kicked off digital broadcasting in December. However, its share of the local advertising market still lags way behind TVB's.

Research firm Media Partners Asia figures estimated TVB held 75 per cent of the television advertising market, while ATV's was only 15 per cent this year. Total Hong Kong television advertising revenue is expected to reach HK$3.4 billion in 2008.

ATV's audience share is similarly estimated to average 15 per cent.

Mr Cheung said the new management believed ATV could perform more strongly and break even. The station's latest business plan will be released in two to three months.

"ATV has lost around HK$5 billion in the past," Mr Cheung said. "With only two terrestrial TV stations in Hong Kong, it's unreasonable that ATV's performance is so weak."

Mr Cheung said ATV needed to grow by itself and could not just seek new funds from shareholders. He added that the Cha family did not rule out putting new cash into ATV, but did not wish to comment on the station's current financial situation.

Mr Wong said ATV programming would be aimed at the middle class and top-end market, with an emphasis on non-drama programmes. That strategy is believed to be designed to avoid head-on competition with TVB, which is strong in drama.

"We don't treat TVB as our enemy. We need to do something that our rivals are not doing well to tap market share," Mr Wong said, adding that he wanted to expand the audience of terrestrial TV. "ATV will position itself as a Hong Kong people's television broadcaster, with both viewers and advertisers mainly from Hong Kong."

Mr Wong declined to say whether the company would lay off staff in the future. ATV now has around 1,000 staff and the company laid off 63 employees last month to cut costs.

"If the appointment [as chief executive officer] was to axe staff, I would not have accepted it," he said.