Excellencies, Distinguished Guests, Ladies and Gentlemen;

Let me first extend a warm welcome to all the participants, particularly our foreign guests, to the Asia TV Forum, Asia Animation and Asia Film Market and Conference 2002.

Since the launch of the Asia TV Forum in Singapore two years ago, the event has grown in both depth and scope. Asia Animation made its debut last year. And this year, the organizers are introducing Asia Film Market and Conference. These additions reflect the dynamic forces at work within the media industry, and the rapid changes we can expect in the media markets in the years ahead.

In Asia, we see three industry trends that augur well for the Asian media industry.

First, Asia’s media market is growing, fuelled by rising demand, especially in India and China. Pricewaterhouse Coopers, in their latest review of the industry, estimates the global entertainment and media market to be about $1.1 trillion USD. Asia Pacific accounts for about 20% of this, with an estimated market of about US$215 billion in 2001.

What drives this market? Pricewaterhouse Coopers characterises the key challenge of this industry as competing for attention. If you think about it, this is perceptive observation. Fundamentally, media demand is driven by how much time each one of us sets aside to catch up on news, watch TV, listen to radio, or go to the movies. But this also means that total demand is a function of how many people there are. And there are a lot of people in Asia. With Asia making up more than half of the world’s population, and the rising affluence of the middleclass in these markets, there is a huge potential for growth in the Asian media markets. Over the next 5 years, Pricewaterhouse Coopers estimates that Asia will grow on average about 5.6% per annum. Given the relatively low economic base in Asia today, this growth rate can be even higher in the longer term, as GDP growth accelerates across Asia from their low base.

Second, Asia is producing more local content to meet this demand. Not surprisingly, audiences all around the world show a preference for films that are set in the context of the world they live in. India is a good example of this. Today, Bollywood alone has an annual output of 1,000 films, which exceeds even that of its illustrious American counterpart, Hollywood. Last year, Bollywood films sold more than 3.6 billion tickets in theatres worldwide, and earned US$108 million in overseas sales.

Another example is South Korea. South Korea has experienced breathtaking export growth in its media productions. Over a five- to six-year period, the total export value of South Korea’s TV drama and film markets have boomed from a negligible base to more than US$20 million today.

In Singapore, the growing interest in Asian films is reflected in our annual Singapore International Film Festival, where close to half the featured films this year were Asian entries.

What these examples illustrate is that the burgeoning Asian demand for media content will not remain forever American or Hollywood-centric. This is not to say that Hollywood films will no longer be popular. On the contrary, we will still live another day to watch another James Bond movie. But there is, and will continue to be, substantial demand for localized media content in Asia, because these films touch audiences through stories and values that resonate culturally with the local communities. The heroes and heroines in Western films are no less courageous or beautiful, but the heroes and heroines of Asian films are the ones that local audiences can better identify with.

Having said this, there is also room for Asian content and Hollywood to collaborate for mutual benefit. For example, following the success of the Japanese movie "The Ring" in Japan, Dreamworks Pictures in Hollywood remade this movie and launched an American version just a while back.

A third trend in Asia is in technology. Asia is quickly adopting digital technologies in media productions. Some years back, many of us were spell bound by the magic of "Fantasia", and captivated by the seductive animations in "Who Framed Roger Rabbit". Today, the use of animation to create special effects is widespread, well received and increasingly a necessary feature to impress audiences. Indeed, we have become so good at this, that in movies such as "Lord of the Rings" and "Final Fantasy", the distinction between the real world and fantasy is blurred.

This high expectation is not limited just to Hollywood blockbusters. In Singapore, MediaCorp Studios has produced a local drama series entitled "The Unbeatables III". This series makes use of digital and animation technologies to keep audiences happy, and ratings high. The special effects are provided by Silicon Illusions, a Singaporean startup company that uses technology and software similar to that used to produce that mesmerizing movie - "The Matrix". For audiences, technology has raised the levels of entertainment and enjoyment. For the industry, it has generated demand for capabilities in digital technologies, which has in turn created new commercial opportunities.

These three trends - growing markets, demand for local content, and widespread use of digital technologies - present Asia with unique growth opportunities.

In response, Asia enjoys three distinct competitive advantages that present media industry players attractive investment opportunities. These are Talent, Location and Culture – or TLC for short.

Asia’s creative talents in media are internationally recognised. Asian directors, such as John Woo of Mission Impossible 2 fame, Lee Ang who gave us "Crouching Tiger Hidden Dragon" and Mira Nair with her highly successful "Monsoon Wedding", have burnished their credentials in Hollywood. Likewise Asian actors and actresses, such as Jackie Chan in "Rush Hour", Chow Yun Fatt in "Anna and the King" and, of course, the very talented Michelle Yeoh in "Tomorrow Never Dies" have garnered fans from around the world. Asian productions, such as "Kandahar" by the Iranian director Mohsen Makhmalbaf, have also consistently been receiving accolades and awards at international media festivals and competitions. And there are countless others, from animators to wardrobe designers who collectively create the make belief worlds that we so fondly enjoy.

Apart from talents, Asia also offers many natural and oft times exotic shooting locations for movies. The magnificent ruins of Angkor Wat became the mysterious labyrinth for the movie "Tomb Raider", and the skyscrapers of Hong Kong played host to James Bond latest adventures in "Die Another Day". Perhaps we would one day see a blockbuster movie shot on location at Sentosa, or at the latest addition to Singapore’s cityscape – the Esplanade!

But what holds even greater potential for Asian media is Asia’s rich and diverse culture. Centuries, indeed millennia, of history and heritage have produced fascinating folklores and riveting stories of courage against treachery, of honour versus deception, of sorrow and survival, of good triumphant over evil, of wit and inspiration. Indeed, with more than five thousand years worth of conflicts, conquests and cultural development, Asia’s cultural heritage is a treasure trove of plots and stories waiting to be discovered, and brought to life. One such example is the story of "Mu-Lan" - an ancient Chinese tale of courage, resourcefulness and sacrifice, brought to life through the animation prowess of Burbank Animation Studios.

Asia’s media sector is poised for growth. But it will take more than just TLC to realize this potential. A number of challenges must first be met. One of the key challenges is to put in place a stronger regime to protect intellectual property. As Asia begins to create and own content, the need for and value of policies, laws and regulations to protect intellectual property rights will become increasingly apparent and essential. We must manage IPR in ways that would stimulate market growth, and at the same time, provide the incentive for investors to take a greater interest in media ventures.

Another challenge is to put in place the supporting infrastructure, frameworks and skills to fund, produce, edit and deliver media content. We need legal and financial frameworks to structure production agreements, funds to pay for the actual productions, and pre and post production editing capabilities to turn out the final product.

We have the market potential, and we have talent and cultural resources to open up these markets. But considerable work is still needed to achieve market success. Take Bollywood as an example. Despite its phenomenal success and prolific output, Bollywood’s global annual revenues is only estimated to be US$1.3 billion this year, or about 2% that of Hollywood’s. But we should not be discouraged by this low number. Instead, we should see it as an opportunity to tap the 98% of unrealized value that lies in Asian media.

In Singapore, we have thinking about this 98% - how we can both play a part to unlock this potential value, and to benefit from it. As part of our economic re-thinking exercise, we have identified the creative industries as a new source of economic vitality and growth. And we see the media sector as a cornerstone of our creative industries, which in turn is one of the driving forces in the new creative economy. My ministry has formulated a Media 21 plan to leverage on media to generate new growth for Singapore in the 21^st century. Through this plan, we hope to attract creative talents and investors from all over the world to develop content, train people, build production capabilities, and manage their intellectual properties and distribution channels for the Asian markets.

In preparation for a bigger push to develop the media industries, the government passed a bill last month to form the Media Development Authority, or MDA for short, to promote, develop and regulate the media industry. MDA will play a leading role to develop the media industry in an integrated and holistic manner across the whole spectrum of media activities. The MDA will officially come into existence on 1 January next year.

Ladies and gentlemen:

Although Singapore is relatively small, we are confident that we can play a significant role in developing the Asian media market. Our advantage lies in the sophistication of our support systems – including financial, legal, and regulatory frameworks, and technical skills and capability - that are already in place to support the needs of the media industry. As this conference demonstrates, we are constantly seeking new ways to work with players across the entire media spectrum. We want to see how Singapore can add value to and play host to media companies and talents.

And despite our small size, we intend to build a dynamic and vibrant media industry within Singapore. We want to see innovation and experimentation, especially in the inter-play between the different sectors of the media industry. Two years ago, we started the ball rolling by introducing competition into the free-to-air TV and newspaper markets. As a result, our media sector today is more dynamic and responsive. New ideas and innovative formats are being introduced and tested – from the way news is being presented, to the types of dramas and current affairs programmes that are being produced.

More recently, Singapore Cable Vision, which up to now is Singapore’s only pay-TV operator, merged with StarHub, a telecommunications player. The merged company is now in a position to offer "triple play" services to its subscribers – that is, an integrated suite of telephony, Internet access and subscription TV services. We expect that over time, new and exciting consumer offerings may emerge from the interplay and overlap of these services.

To further encourage innovation through competition, the Government has decided to make available a second pay-TV licence by the middle of next year to interested parties through a "beauty contest". We will leave it to the market to decide what is feasible. But competition in the pay-TV market will certainly add "buzz" to the media industry, and open up new opportunities for collaborations and partnerships. More details will be made available when the MDA invites bids for the second pay-TV licence early next year. In the meantime, industry players are welcome to register their interests and views with the MDA.

In conclusion, let me summarize my main points. The Asian media market is growing and offers many opportunities for profitable investment. Asia has the talent, the locations, and most of all the cultural content that can be leveraged to created media products for both Asian and international markets. To realize this potential, governments and the industry in Asia must put in place a strong IPR regime, and build infrastructure, capabilities and skills to support the development of the Asian marketplace.

Ladies and gentlemen: yours is an enchanting, enthralling and enticing industry. Singapore believes in the potential of this industry, and is gearing up to play its part to promote and support its growth. I wish you a fruitful and successful conference as you explore the opportunities and challenges that lie ahead, and hope that you will forge many productive partnerships, to expand and benefit from the Asian media market. Thank you.

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