Cignal TV in the Philippines enters 2018 with a brand new stand-alone original production unit and a slew of high-profile creative partnerships, ambitions to create everything from TV series and mobile-first shorts to full-length theatrical features, and a determination to be creatively bolder and braver.

Plus there’s the new windowing ecosystem designed for visibility on all platforms, including OTT/streaming and digital terrestrial, and a determination to repeat 20% growth in subscribers and viewership.

Not quite two years into her role as president and chief executive officer of the subscription television platform, Jane Jimenez-Basas is taking Cignal into a space inspired on all levels by regional giants, global streamers, and the confidence that Cignal can be part of the push towards 35% subscription-video penetration in the Philippines in the next three to five years from today’s 18%.

“Our ambition is to shift what we are about... we want to go beyond being a pay-TV company that acquires and aggregates content. We like to see ourselves beyond that, to actually producing relevant and fresh and intelligent content that we can deliver across all pipes, including TV,” she says.

For Jimenez-Basas, premium video in the Philippines looks nothing like a costly retreat for elites, nowhere near that go-to place for expensive content few in the country can afford. “We are driven by democratisation of premium content for everyone,” she says. “We are breaking down the perception that pay TV is only for the elite... That’s one of our secrets to success.”

Is it working? Yes. Of the Philippines’ 20 million households, most of which have a single TV set shared by a family of five or six people, 3.5 million subscribe to pay-TV services. Cignal accounts for almost 60% of those and is growing. “There is room to grow outside of cannibalising our competitors,” Jimenez-Basas says.

Jimenez-Basas, clearly, is a firm believer in television, which is, she says, “the glue that binds the family for shared appreciation of local pop culture, news and sports”.

“It’s easy to dismiss this as being backward and antiquated, specially in the sophisticated digital world we have nowadays. This, however, is the market we have in the Philippines,” she says. Unlike other territories, she adds, the Philippines isn’t suffering from decreases in total pay-TV usage on the back of cord cutters and the growing group of cord-nevers.

“For a lot of people, especially our colleagues from far more economically advanced nations and city states, pay TV has become an afterthought in an industry enamoured with OTTs, TVODs, SVODs, and whatever the darling acronym of the moment is. In the Philippines, however, the story is far, far different,” she told delegates from across the region at this year’s ContentAsia Summit.

At the same time, Jimenez-Basas is not unaware of what’s down the road, including free digital terrestrial services, which she says the company is looking at closely. The PLDT’s free-TV network, TV5, is legally required to shift to digital. Access to three frequencies potentially allow the company to put up 21 channels.

She’s not ready to talk details but says the conversations are happening. “By 2018 I will have something in place to offer to the market,” she promises.

The challenge for Cignal is to “deliver what the market currently consumes while preparing for a shift to the OTT (and other) services it will consume more and more heavily in the future,” she says.

“We need continued innovation to grow the market and increase penetration,” she says.

Future innovation builds upon the tech upgrades that supports picture and sound quality, including the insistence that HD services, which Cignal pioneered in the Philippines, were available across all Cignal price plans. Distribution innovation included tapping the infrastructure and brick-and-mortar networks of parent and sister companies, Philippines Long Distance Telephone company (PLDT) and telco Smart.

Jimenez-Basas says the Philippines consumer has become more sophisticated. “From being satisfied with access and transmission quality... the palate for content has become more discerning not only for breadth of choice but for relevance of material,” she says.

“The industry is now shifting from a delivery game to a creation game. The Filipino consumer is not just content to watch shows, they want to be told stories and finding the way to tell them relevant stories is the value that Cignal wants to start giving its customers”.

Affordability is a key issue. “Sometimes what you want you just can’t afford,” she says. “That’s the reality of the market right now”.

Not many in the Philippines can, for instance, pay a US$5-US$10 monthly subscription upfront for SVOD content. “They will download it for free but as soon as you start charging, the usage stops,” she says.

“Drawing on our experience in the telco space, we know they will be hard pressed to buy in bulk. But we also know they will buy in smaller amounts and consume in smaller packets. Given that it is a predominantly a pre-paid market (Cignal alone has 75% of its base paying via pre paid), we have to give the consumer what he wants, for what he can afford, in a way that makes it easy for him to pay.”

The answer, she says, is “sachet content”, episodes that are broken down into bite-sized 10-minute data-subsidised capsules that can be bought using regular airtime load.

“This is possible by taking the best of both worlds. Cignal with its natural affinity and network of content creators and PLDT Smart with its distribution network and built in wallet and payment platforms,” she says.

“From a telco perspective, this can potentially increase ARPU by Ps2/US$0.04 to Ps5/US$0.10 per 10-minute episode, which is significant when you are looking at a monthly ARPU of around Ps100/US$1.97 for traditional telco services and even more significant if you consider a base of over 60 million subs actively purchasing data load daily. If I can penetrate 2% of the 60 million subs, I can generate US$500,000 to US$1.5 million per title. Expand this to 20-50 titles over a period of a year…” The incentive to create quality content is clear.

But content that can make its way to 60 million people is not that simple. Quality has to be deserving and stories compelling, she says. Which takes her to her next vision – Cignal Entertainment. She calls the production unit, set up in July this year, a “logical next step that allows us to cater to the consumer’s ‘moreifying’ tastes for content and to prepare us for the eventual shift to video OTTs and other digital platforms”.

Original production, she says, “allows the company a way to differentiate ourselves from the rest of the pay-TV operators and to future proof the business as the industry evolves. While it is easy to compete from a premium channel acquisition standpoint, this is simply not a sustainable method; ultimately, when every notable channel partner has been signed up by all players, this results in a price war.”

Which is why she is so insistent that Cignal start telling its own stories. “New stories. Stories that are different, with characters that are flawed yet inspiring, and even stories that others are afraid to tell... Stories that need to be heard regardless of political stance,” she says.

Cignal Entertainment’s ambition is to create stories that are intelligent and relevant with high production values and address the taste of domestic audiences as well as the 10 million Fillipinos around the world. “We are going to tell the stories that are not of the usual flavour”.

The first series is four-part crime drama, Tukhang, with local production house Masque Valley Productions; the show premiered in July on both Sari Sari – a joint venture between Cignal and Vic Del Rosario’s Viva Communications – and Colours.

Tukhang tackles – some say bravely given the political environment – the Philippines’ violent war on drugs. The series, starring James Blanco as a tormented police officer and Karen Marquez as a journalist, was written by Jose Javier Reyes and directed by Lawrence Fajardo and Derick Cabrido.

Another title on the early slate is Tabi Po, based on Mervin Malonzo’s graphic novel about flesh-eating creatures known in local folklore as “aswangs”. The six-parter, directed by Paul Alexei Basinillo and starring AJ Muhlach as aswang Elias torn between love and his true nature, premiered on 27 October in a prime time 8pm slot as part of Sari Sari’s Halloween schedule.

Cignal’s venture into production is a deliberately collaborative effort. “We have access to great partners, some of the biggest names in the industry”, such as production icon Vic Del Rosario, with whom Cignal started producing last year. The two-year-old Sari Sari Network produces about 100 hours a year of entertainment content, including tele-movies and miniseries. Basas would like to scale that up to 300 hours.

Cignal Entertainment is also working with Unitel Productions, Content Cows Company, The IdeaFirst Company and Masque Valley Productions.

Jimenez-Basas is wide open to co-production – from anywhere, and there doesn’t have to be a Philippines angle. The first feature co-pro is the full-length horror thriller, Maledicto, with the Manila-based Philippines’ HQ of FOX Networks Group. “I would like my people to learn how to write scripts for the international market,” she says, adding: “This is a whole new opportunity for story tellers”.

Jimenez-Basas wants Cignal Entertainment to be “bigger than video content”. The ambition is to build three content pillars – video, live content/entertainment and home shopping/e-commerce with a mobile/digital component. “Our core as a multi channel network lays the groundwork of partnerships to serve different target markets, reaching out to creators who have different expertise and strengths. That makes sense to us.”