The launch of BBC Knowledge in Vietnam looks like a linchpin deal for BBC Worldwide.

Carriage on HTVC, southern Vietnam’s second-largest pay-TV platform, gives access to a key growth market just beginning its climb, while delivering a regional boost to one of the BBC’s most lucrative channel brands.

Featuring the BBC’s most successful program, Top Gear, Knowledge has been the tip of the spear for market entry across the region, as well as a key asset to unlock ad sales.

Entering on HTVC’s basic tier, the deal puts a localized feed for Knowledge in front of approximately 700,000 households, adding to wide distribution in Indonesia, Hong Kong, Singapore and Thailand within Southeast Asia.

700,000 additional Vietnamese households will be attractive for regional advertisers, but local ad sales will require the BBC to accumulate between 3-5 million to be competitive.

Local ad sales is a new initiative for BBC Knowledge, as it seeks to court territory-specific ad spend. Knowledge now features local ad spots on Singapore's StarHub, and the BBC plans to expand this to Indonesia and the Philippines.

Compared to international rivals such as Discovery and Nat Geo, the BBC is a latecomer to Vietnam. Fox International Channels is already generating robust local revenue from strong inventory built up in its Nat Geo and Star World channels.

However, the BBC may have received an inadvertent boost after stringent new localization requirements were introduced early in 2013, forcing foreign content providers to redraft growth plans.

Strategic value

All in all, it’s a good time for the BBC to start ramping up its Vietnamese presence.

Foreign pay-TV content is well-received by media buyers in the populous market, where free TV offers considerable reach but largely homogenous content.

With 14.6% of the total market, pay-TV ranks after free TV as Vietnam’s second-largest ad medium, according to estimates from Media Partners Asia.

Typical of many deals in this promising but difficult marketplace however, the real value lies in a long-term strategic play rather than in near-term revenue gains, which are likely to be small.

Acquiring an editorial license in Vietnam is a typically lengthy and onerous process. Foreign channels must first localize content, and then find local state-owned partners to vet it.

Now the BBC has one for arguably its lead channel, which can be leveraged to eventually bring in its Lifestyle and CBeebies brands, while building out local content sales at the same time.

BBC will now seek distribution in the northern capital Hanoi on VCTV, run by state broadcaster VTV, by the end of 2014.