The Walt Disney Company is partnering with Thailand's biggest pay-TV company, TrueVisions, to launch the Disney XD channel in Thailand while expanding the reach of Disney Channel and Disney Jr., all of which will now be localized for the Thai market.

Having securing broader distribution, Disney will “explore an opportunity to create a much more robust media solutions business in Thailand in the coming months,” says Disney’s general manager for media distribution and sales in Southeast Asia, Amit Malhotra.

The deal offers Disney's major brands significant reach, which should help boost local ad sales, an important source of income for the entertainment major which is looking to develop a dual revenue business model for its branded channel business in Southeast Asia.

While Disney’s new localization investment will be subsidized by True’s affiliate fees, longer-term returns will be funded by ad sales.

Under the agreement, Disney will have access to all of TrueVisions’ 2.2 million subscribers, in addition to licensing Disney content for TrueVisions’ Spark, Explore 3, Film Asia and X-Zyte channels.

Disney also plans to distribute Disney Channel, Disney XD and Disney Jr. via TrueVisions’ TV Anywhere platform for authenticated simulcasts and as an on-demand catch up, leveraging the broadband offering from telecom major True Corp, the parent of TrueVisions. Thai consumers can also access Disney content through an iTunes store.

Strategic positioning

In Thailand’s large free-to-air market, Disney also has a distribution deal with highly rated Channel 7, for a block of animated children’s content as well as rights for Disney, Pixar, Marvel and Lucas films.

In recent months, Thailand has been a major focus for international content brands keen to capitalize on shifting competitive dynamics in pay-TV distribution, as well as the growth of a large TV ad pie worth close to US$1.2 billion in net terms. Pay-TV has less than 2% share. 

In May, Fox International Channels (FIC) signed a non-exclusive agreement with content aggregator CTH for the pay-TV market, while inking a deal with DTH operator GMM Z at much the same time.

More recently, Turner announced a joint venture which will bring its Boomerang brand to Thailand.

Nonetheless, Thailand's TV distribution market reamins in flux, keeping both local and international players on their toes.

“Going forward, the pay-TV industry’s biggest concern will be the launch of digital terrestrial television or DTT, which will increase both the number of channels and signal quality of free-to-air terrestrial TV,” says Aravind Venugopal, an analyst with Media Partners Asia. 

“This could be the biggest threat for pay-TV channels hoping to garner a larger share of the TV advertising pie, unless they decide to enter the DTT space themselves.”

Malhotra intends to direct more resources to the Thai market, including marketing promotions, both on and off air, to capitalize on TrueVisions' 2.2 million strong subscriber base.

Disney’s goal is “to be available on platforms before the consumer gets there,” according to Malhotra. This may include future deals with TrueVisions’ parent True Corp for gaming, digital books and music.