Asia: The outlook for cloud TV in a connected Asia

This article was produced by Olswang LLP, which joined with CMS on 1 May 2017.

The US Supreme Court in Washington, DC may be some 12 timezones from Singapore but you can be sure that the Aereo case was being followed very carefully in the offices of media and technology companies across the city-state.

Why was a US law case about a US service and US content owners being monitored so closely in Asia?

After all, Asia has, as of the time of writing, never had an Aereo.

It is worth noting at this point that cloud TV is very much a reality in Asia, with a broad range of legitimate and illegitimate services already available across the continent. Indeed, courts across the region have for some time been wrestling with the implications of cloud TV services on existing copyright laws. There have been multiple cases, from the 2010 case of RecordTV in Singapore to the 2011 case of Maneki TV in Japan (the former decided in favour of the cloud TV service, the latter in favour of the content owners - don't look here for clear winners and losers, either).

The first reason that Aereo matters in Asia is the habit judges have, when they find themselves in unchartered waters, to look to decisions reached elsewhere. The RecordTV case in Singapore, in which the court surprised many by finding in favour of the service provider, drew heavily on the 2008 Cablevision decision in the US. Put simply, when the next Aereo-like service pops up, there's a reasonable chance that courts in Asia will look towards Europe and the US for precedent.

Another reason that Aereo matters in Asia is what one might call the "age of Rocket Internet". That is, a time of rapid rollouts, when disruptive business models from one part of the world can be launched in untapped markets at record speed. Regardless of the copyright law rationale, it seems likely that a clear decision in favour of Aereo (and the subsequent positioning of Aereo as a legitimate, mainstream service that would inevitably have followed) might just have encouraged an entrepreneurial-type somewhere to ask themselves whether there might be an opportunity there for "the Aereo of Asia". And whilst that might have been good news for copyright litigators, it might also have damaged the possibility of content owners and cloud platforms finding sustainable, collaborative business models.

So, post-Aereo, what is the prognosis for cloud TV in Asia?

Copyright law challenges remain, particularly in those jurisdictions with weaker enforcement of intellectual property rights. Whichever way one looks at Aereo, it did at least go to great cost and expense to try to position itself as being within the boundaries of copyright laws. In some Asian countries, by contrast, there are more plainly illegitimate services that don't even go to those lengths, relying instead on weaknesses in the intellectual property enforcement regime to survive. Of course, Asia is a diverse place, and countries like Singapore, Japan and Korea do have very well-developed intellectual property enforcement regimes, but there are still some countries that do not, and in those countries, we will continue to see illegitimate cloud TV services enjoying some successes and, by doing so, discouraging legitimate services from launching.

But there is also a big opportunity for legitimate cloud TV services in Asia. Although it remains the case that a large proportion of consumers in some Asian countries do not have easy access to a device with a broadband connection capable of streaming high quality video, Asia is nonetheless in the midst of a period of explosive and unparalleled growth in connectivity and connected devices, and that is in a continent with over 50% of the world's youth.

With some help at government level from some more decisive action on intellectual property enforcement, if stakeholders can find collaborative business models that appropriately reward content owners, enable cloud TV operators to monetise innovative platforms and, most of all, cater to the growing demand of this connected "Asia 2050" generation, then Asia might just be the next big opportunity for legitimate cloud TV services. And, if they can't, then it is probably a matter of time before the principles at play in the US Supreme Court last week are being debated in a court somewhere in Asia.

To learn more about the implications of the Aereo decision, read our Aereo and the future of cloud TV report.