Johan is championing democratisation at Media Prima

Painter, rock guitarist, creative crusader (also a Chartered Accountant and once PwC auditor), Johan Ishak may be a difficult man to define even though he has been CEO of Media Prima Television Networks (MPTN) for a year now.

One thing Johan is not is shy.

We hijacked him from a sea of people at Pavilion KL on Merdeka eve where they were doing a social experiment entitled “Sekuat mana perpaduan rakyat Malaysia?” to assess unity among Malaysians.

After jostling with a massive crowd and going ballistic with rock band Bunkface who sang the official National Day song “Sayangi Malaysiaku” which was written by them, Johan emerged unscathed and ready for this interview….

Digital challenges and possibilities have liberated our ecosystem with a rejuvenated democracy that is sweeping the country.

In a recent piece you shared extensively about democratising advertising and content…..

Enough cannot be said about it. It is about freedom and where everyone wins. We are taking freedom to a new level. TV advertising is known to be the most expensive medium but is also the most efficient. Some digital advertising is gaining popularity but who can argue with a drama series like Nur, that garners a reach of 11 million viewers (one third of the country’s population)!

In democratising advertising, we will make TV advertising affordable to non-traditional tv advertisers who now can’t afford it. The Keynesian Economic model will tell you when there is demand, the price must go up. So this is the plan…MPTN will segregate which time slots are premium for traditional advertisers and which ones strategically positioned at cheaper rates. We want to see businesses like car mechanics, Nasi Lemak restaurants, childcare centres and the like to appear on TV too.  After all, Malaysia’s primary economic movers are SMEs. Why not add to that multiplier for a win-win economic benefit? Embracing this, MPTN has introduced #JomMasukTV.

And what about content?

Democratising content is the new game in town. MPTN’s first window is TV as television ad spend is still strong. Then we pivot onto our very own Over-the-Top (OTT), tonton.com.my, where subscribers pay RM10 per month to watch our 30 years worth of content. And this is now FREE! It still makes business sense to us because the twin brother to TV advertising is Digital advertising. So the happiness index goes up for viewers, advertisers and of course MPTN. Everybody wins.

What’s happening to tonton?

We are the first OTT in the country and in the region. We have gone through the different facets of an OTT’s life cycle. Tonton started 8 years ago, and we were toying with different ideas on how to monetise it but after 8 years, we’ve realised it’s very difficult to run the subscription business. When people started getting alternative content which did not require payment, they skipped the ones they had to pay. We can’t deny them the freedom of choice.

Everybody is asking why Media Prima is now working with YouTube… 

That’s the agreement we did that was announced a few weeks ago. 80% of video consumption on the Internet is from YouTube in Malaysia. Even my kids are not watching pay TV anymore, they have gone to YouTube. We were fencing the content in tonton for 8 years, but then we realised why don’t we just uplift it and go everywhere. Tonton is still the one stop OTT for all our content, it is for free and the look and feel is different. It’s more smartphone friendly.  Now we have decided to democratise the content. So after TV, where we get television ad revenue, the content can go anywhere – to YouTube and also other OTTs.

I noticed YouTube also champions freedom of information, opportunity and belonging. Are you not diluting tonton’s content by sharing it with the world’s largest online video platform? 

The user behaviour is different: for YouTube, users would probably Google to look for a particular title but on tonton, they know we are broadcasters therefore users will head in and look at the available content. It’s like purchasing Adidas shoes; you can purchase them at an Adidas store or at an Al-Ikhsan store. So if you try to protect the earning revenue from Adidas store and try to not go to Al-Ikhsan, it’s probably more detrimental to your earning capacity.

Having said that, I need to correct the perception the market has when we did an announcement with YouTube, they may have missed the point of this democratising. It is not about moving from tonton to YouTube, it is simply about reach. Industry and tech wise, it makes sense for us to capitalise a lot more on the tech leaders, instead of investing in more tech inhouse. It’s about revenue generating and cutting costs which give the optimum, not maximum results.
Tonton you see today is powered by YouTube and DailyMotion technologies. DailyMotion will be the engine behind our life, and Youtube will serve as the library. It is more cost efficient.

Is Media Prima closing the doors for potential collaborations with other platforms?

It is not exclusive. Whatever makes the best economic sense, we will gravitate towards it. So if the other OTTs feel like they want to work with Media Prima, to collaborate with us and use our content and that makes better economic sense than Youtube, we will go for it.

This is what we call windowing. The first window will always be TV. The second window is catch up tv, it’s a separate window because it earns advertising revenue.
Now if there are other partners who want to collaborate with our content, we can create the second window again and that economic number may be better than us straight away heading into Youtube.

So how do you monetise?

Live content on tonton will carry advertisements, the content on YouTube won’t. Whatever advertisements that come through YouTube’s channel can come on tonton’s content, and we get our revenue share.

It is also a brave move….

Democratising means sacrificing certain elements of the business model, therefore you have to be more focused. We are not going to go for SVOD (Subscription Video On Demand), we are just going to go for AVOD (Advertising Video On Demand) which is free to consumers.

Because if you try to do both, in an era where content is made for free, it’s the classical dilemma of cost leadership versus differentiation in marketing textbooks.
There are plenty of other players in the market, OTTs who are driving the SVOD business and we will be observing their progress to see how SVOD is growing. At the same time, it does not mean whatever actions we are implementing now are set in stone.

What advice can you give to marketer’s offline-online budget balancing act?

If you’re putting 40% of your budget into digital, bring it to us because we have the largest local group of digital assets in the country. When we acquired Rev Asia last year, it immediately placed us as the number 1 ranking digital media company because in total our digital assets give us around 11-12 million monthly viewers.
If you open the ranking to global digital platforms in Malaysia, we are Number 3 as Google is Number 1 and Facebook is Number 2.

Between the CEOs in the Group, we are not worried about our own little division anymore, so I’m not too bogged down to thinking about what works for TV. Even if it means sacrificing my TV division and allowing other divisions in, it’s okay as long as Media Prima is working together providing solutions. Instead of being platform centric, we ask “what is your product, what is the audience, what is the best way to reach your audience and what makes sense”. If it means 2 platforms out of 5, so be it.

Moving forward….

We are closely monitoring the progression of Google’s machine learning and artificial intelligence products to see if it makes sense for us to use them. We have our own inhouse too, which develops programmatic tech for the purpose of pushing advertisements to different target audiences across
Media Prima’s digital assets: it’s called AudiencePlus.

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