Asia’s pay-TV industry is bracing for another tough year.

Even the brighter spots like India are blighted by the uncertain impact of recent regulations, and uncertainty hangs dark and low as international giants adjust their commitment to their linear services in favour of shiny new direct-to-consumer options.

Our prediction is more tough conversations as traditional platform partners and programmers work out a way forward – or not – juggling costs, content rights and relationships in a gyrating landscape.

So far, there’s no confirmation of region-wide rollouts of Disney+ or HBO Max or Peacock or even Disney’s India platform Hotstar. So those are among the unknowns at the dawn of the Year of the Rat.

Meanwhile, we’re counting the fallout of changed priorities in the region, and watching out for the next wave of streamlining. This will wash over an industry that has been in attempted-reinvention mode for the past two years.

In the latest change, Sony Pictures Television has offloaded its Asia networks (excluding the lucrative India biz), selling for an undisclosed amount to a new entity set up by veteran Sony execs Andy Kaplan and George Chien.

Both Kaplan and Chien know exactly what’s under the hood here, so we’re taking the view that the acquisition is a vote of confidence in linear pay-TV services and that there is a business there. It’s just not the kind of business that U.S. studios like Sony find compelling anymore.

Sony’s appetite for the linear networks business in Asia has been under an industry microscope for months – even before it shuttered the 12-year-old English-language general entertainment service, Sony Channel in May 2019 – as part of the scrutiny of U.S. studios’ commitment to linear channels in the region.

NBCUni was under the same microscope. On 31 Dec 2019, the plug was pulled on the last of its entertainment channels – E! and Diva. This follows the exit of Syfy and Universal Channel in June 2017, leaving the network with DreamWorks for kids and biz network CNBC.

At about the same time, CBS and RTL pulled the plug on their four-year-old channels JV, offloading two regional networks – RTL CBS Entertainment and Extreme – to Canada’s Blue Ant Media.

As part of an industry-wide shift away from large bundles towards a focus on higher-performing channels and key brands, Turner (pre-WarnerMedia) also took an axe to its linear bundle, shuttering Turner Classic Movies (TCM) and truTV HD across Southeast Asia and Hong Kong from January 2019.

Discovery has also axed channels in favour of a tighter focus on fewer services. In the past few years, Discovery Kids linear has gone, along with Setanta sports network and Eve, the network’s short-lived effort to target female audiences.

As 2020 moves into week three, the industry remains on high alert for more changes at Fox Networks Group (FNG) under Disney. So far, FNG has pulled the plug on three on-demand play channels – Fox Sports Asia, Star Chinese Movies Play and Fox Movies Play. Those went in June 2018. FNG also closed Nat Geo Music and disappeared Channel [V], an early victim of changing times and consumer habits.

Where does original content creation stand in all this? Depends. Our bet is that big-brand originals like Asia’s Got Talent for Sony’s AXN will take a while to return to pay-TV, if they ever do. HBO Asia will continue to drive originals and investments in other companies’ projects. Netflix will continue to spend, but more selectively and maybe not so much in Southeast Asia/Taiwan until they figure out how not to repeat their mis-steps, but definitely in India and Japan. Ditto on India and Japan at Amazon. Viu is all systems go, now that it has amputated the India unit. If there is local production by pay-TV programmers, our bet is that it will be led by sponsored projects with heavy product placement that have paid for themselves before they are greenlit. Sigh.

This article was originally published in ContentAsia's 13 January 2020 eNewsletter