Executives at Sony Pictures Television are busy recalibrating the broadcaster’s entertainment portfolio to meet the shifting demands and priorities of pay-TV subscribers and platforms in Southeast Asia, unveiling a major revamp of English flagship AXN – the biggest since the channel made its debut 18 years ago – while rolling out a new Asian entertainment offering, Gem.

It’s a rebalancing of investment and resources towards regional Asian entertainment, seen as powering the next cycle of pay-TV growth, while focusing on two core brands in English entertainment, male-oriented AXN and female-oriented Sony Channel.

Sony Channel had an update of its own at the end of last year, with some fresh programming and expansion into new markets.

The future of Sony’s third English entertainment offering, beTV, which remains operational for now, rests on operator demand.

“We are not going to force the market to take it, if people feel they are well served,” says Hui Keng Ang, SVP and GM for Sony Pictures Television Networks in Asia. “Less is more.”

English entertainment retains its appeal for upscale viewers in Southeast Asia, but rising demand for day-and-date programs – increasingly seen as table stakes by operators competing with pirated alternatives – is squeezing margins and driving up costs in what remains a crowded market.

The programming budget at the new-look AXN also includes money for mid-season shows and more original programming as the schedule is moves closer to broadcast times in the US, with most big imports coming on air when the new US season starts over the next few weeks.

Deeper localization

Sony is also ratcheting up investment in market specific shows for AXN in Asia, while maintaining its output of format-based regional productions.

Ang is looking to kickstart this new phase of development in three territories with sizable ad markets, before looking to replicate the initiative elsewhere.

“We have not done it before at a scale that is sustainable and in a volume that makes people notice and pay attention,” he tells Media Business Asia. “That will be the new focus. We have to do it in key markets.”

At the same time, Ang is optimistic that new Asian offering Gem can repeat the success of One, a Korean entertainment channel built around an output deal with Seoul-based broadcaster SBS.

One version of Gem already exists in Vietnam, where it is fully owned and operated by Sony as a Chinese entertainment channel.

The channel targeting other markets Southeast Asian markets is different however, run as a joint venture with Japanese broadcaster Nippon TV which supplies most of the prime-time programming.

At the same time, Nippon TV is halting syndication deals in the region, while honoring existing contracts, to support Gem, which marks the broadcaster’s first involvement with an overseas channel.

A financial stake in Gem is part of a wider diversification for the Japanese broadcaster which has also branched out into home shopping, movies and SVOD over the past year or so, to reduce exposure to a large but slow-growing TV ad market at home.

Gem will follow the path pioneered by One, looking for broad distribution on basic pay-TV tiers to open up local ad markets, while giving households with less interest in English fare another reason to subscribe to pay-TV.

Success requires a sustained marketing campaign to rekindle interest in Japanese content, alongside more distribution deals to widen the channel’s reach.

At launch in October, Gem will be on major operators in Hong Kong (Now TV) and Thailand (TrueVisions), with additional carriage in Indonesia and Cambodia.

“It will take about 24 months for decent carriage across all of Southeast Asia,” Ang says. “That’s not something you can short cut.”

The next batch of distribution platforms should come on stream around six months after launch, in Q2 next year.

Japanese content fills about 60% of Gem’s schedule, with shows from mainland China and Taiwan making up most of the rest.

There are no plans to roll out a more dedicated Chinese channel, the current positioning for Gem in Vietnam, at least until the JV with Nippon is established in key markets.

There are also fewer candidates in Chinese entertainment for an anchor output deal that helped shape both Gem and One.

SBS, meanwhile, recently renewed its output deal for One, now present in six markets after launching five years ago.

The channel has started generating ad revenue in Indonesia, Malaysia and Singapore.

Ang sees scope for more, talking to SBS about potentially launching the channel in territories where the Korean broadcaster has long-standing syndication relationships, such as Hong Kong, the Philippines, Thailand and Vietnam.

“We want any change to be managed well,” Ang says. “We value those relationships too.”