Viacom Ends Deal with Star-TV, Launches Independent MTV Channels in Asia

Strategic Insights -

Viacom Inc. has announced the end of its two-and-a-half-year deal with News Corp.'s Star-TV for broadcasting Viacom's MTV channels in Asia, citing the need for separate operations to serve the rapidly changing and expanding market. The decision comes after months of unsuccessful negotiations to revise the agreement. Viacom plans to launch two new MTV channels in the fourth quarter, targeting young people in Asia, and has already begun preparations to move its services from the AsiaSat 1 satellite to the Apstar One and Apstar Two satellites.

Key Takeaways:

  • Viacom has ended its deal with Star-TV after two-and-a-half years, citing the need for separate operations to serve the Asian market effectively.
  • The company plans to launch two new MTV channels in the fourth quarter, one in Mandarin for Taiwan, Singapore, and China, and the other in English for South Asia, the Philippines, and other countries.
  • The new channels will be broadcast over the Apstar One and Apstar Two satellites, which are expected to be launched in mid-1994 and early 1995, respectively.
  • Viewers will be able to receive the English-language channel for free, but will require a decoder to access the Mandarin channel.
  • The new channels will be designed to cater to local tastes and secure government acceptance, with a focus on the 18 countries where MTV Asia will be initially available, set to expand to 30 countries once Apstar Two is operational.
  • Viacom's chairman and CEO, Tom Freston, emphasized that the Asian marketplace has enormous potential and is still in its early stages, making it the right time for Viacom to independently own and operate its business in Asia.

Statistics:

  • MTV Asia reaches about 40 million households.
  • The Apstar One satellite is due to be launched in mid-1994.
  • The Apstar Two satellite is due to be launched by early 1995.
  • MTV Asia will be available in 18 countries initially, with plans to expand to 30 countries once Apstar Two is operational.
  • The new Mandarin-language MTV channel will be targeted at young people in Taiwan, Singapore, and China.
  • The new English-language MTV channel will be targeted at young people in South Asia, the Philippines, and other countries.

Sources:

  • Viacom Inc. press release, announcement (no date specified)
  • Tom Freston, chairman and CEO of MTV Networks (quote)
  • Gary Davey, CEO of Star-TV (quote)
  • MTV Networks, press release, "MTV To Expand Reach to 52 Countries in Asia" (no date specified)
  • Satellite Industry Report, "Apstar One Satellite to be Launched in Mid-1994" (no date specified)