Hong Kong Television Network (HKTV) has struck a deal with Chinese internet giant Tencent that could hugely expand the new station’s viewership.
HKTV, which will start broadcasting TV programs over the internet on Nov. 19, said in a statement on Wednesday night it had granted Tencent’s online video arm the exclusive right to broadcast HKTV’s dramas on the mainland.
From that date, mainland audiences will be able to watch the HKTV dramas on smartphones, TVs with set-top boxes or smart TVs over v.qq.com.
Before the Tencent deal, HKTV had sold content distribution rights in Southeast Asia, Australia and New Zealand to Astro, a Malaysian firm that offers a direct-broadcast satellite pay-TV service.
The HKTV programs will have to be censored by the State Administration of Press, Publication, Radio, Film and Television before they can be broadcast on the mainland. That means Tencent can edit the content to meet regulatory requirements.
As HKTV is only selling Tencent the broadcast rights to its dramas, it is Tencent and not HKTV that will be legally responsible on the mainland for the content, Ming Pao Daily reported, citing sources.
Before the deal was announced, it looked as though a lukewarm response from advertisers could mean HKTV would lose money on the first programs it airs.
Only three advertisers have agreed so far to be special sponsors — for the series “The Borderline” and “Once Upon A Song” and a variety show.
The first series scheduled to be aired, “The Election,” has failed to attract a special sponsor, because of its sensitive topic, Apple Daily reported Wednesday, citing sources in the advertising industry.
“The Election,” a political drama, stars Malaysian actress Angelica Lee as a candidate for Hong Kong’s chief executive in the 2022 election. More than 900,000 people voted online for it to be HKTV’s first offering.
But only three advertising packages have been sold for the series, with a maximum possible revenue of HK$6.29 million (US$812,000).
An HKTV spokesman would say only that some clients had decided to shift their commercials from other programs to “The Election,” because of its popularity among netizens.
Nine advertising packages were sold for another popular series, “The Borderline,” a police procedural drama.
If it succeeds in attracting the highest level of viewership on a ratings scale, revenue from those packages will amount to HK$18.72 million before discounts, based on the latest information HKTV released to advertising companies.
Since HKTV chairman Ricky Wong Wai-kay has said each episode in one of the company’s TV series costs between HK$1 million and HK$1.2 million to make, “The Borderline,” with 17 episodes, may have cost as much as HK$20 million and is unlikely to make a profit.
Tsang Kam-keung, chief executive of advertising firm The Bees Group, said his clients had not placed any advertisements on HKTV shows, mainly because the advertising fees are too high.
He said advertisers are mainly taking a “wait-and-see” attitude, because internet broadcasting is a new platform for the city. While he said he was a bit surprised about the lack of enthusiasm among advertisers, he expected HKTV to attract more advertisers if viewership turns out to be strong.
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