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The three key TV streaming trends in Southeast Asia

Southeast Asia is a vibrant market with plenty of current activity in the TV streaming arena. A close analysis reveals three key trends worth examining.

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Southeast Asia remains a young market in streaming terms compared to the rest of the world. Household penetration is still relatively low in comparison to other global markets, leaving plenty of headroom for growth. While challenges are present in the region, as they do worldwide, some suggest that the focus on acquiring new subscribers must now be balanced with maintaining profit margins and increasing ARPU.

Here are some key data points from across the whole of the APAC region provided by Digital TV Research:

  • 687 million SVOD subscriptions by 2029, up from 594 million in 2023
  • Asia Pacific OTT TV episodes and movie revenues will reach $49 billion in 2029; up from $34 billion in 2023
  • AVOD revenue growth is set to outpace SVOD growth; $9bn vs $4bn over 2023-2029
  • The big six US-based platforms will account for only 18% of the regions OTT revenues by 2029 – the lowest proportion for any region worldwide.
  • Cord cutting’s impact is lessening growth rather than reversing it. Asia Pacific will add 11 million pay TV subscribers by 2029. 15 out of 22 countries will see growth

Narrowing our scope back to Southeast Asia, the first reports from the 2024 financials look positive. So, what can we say about what broadcasters and operators are looking for in the Southeast Asian market? As the industry continues to evolve and demand new features and functionalities, at VO we are proactive in meeting these needs and regularly engage with our existing customers. Based on these interactions, as well as our pursuit of new RFPs in the local market, we have identified three key trends dominating the Southeast Asian market.

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Three key trends in Southeast Asia

The growing strength of local content. Local content remains a key strategic element of broadcast and streaming services across Southeast Asia, with the big six US-based streaming platforms expected to account for only 18% of APAC OTT revenues by 2029 – the lowest proportion for any global region. Some, such as Amazon, have tried to move the dial on this by investing heavily in Southeast Asian original productions. However, economic headwinds have caused this strategy to be replaced by more licensing partnerships with domestic content producers. Korean dramas in particular are extremely popular, capturing nearly 30% of total premium VOD viewership across Southeast Asia.

We talk to a lot of Tier One telcos, and they remain extremely interested in super aggregation as a result. Viewer preferences reflect cultural diversity across the region, making domestically produced content from strongly branded regional media companies and streamers of vital importance. Super aggregation is seen as a very cost-effective way of being able to offer this, in concert with the global offerings from the large US streamers. Such stacking is proving a popular option amongst consumers, especially when it allows them to flex their subscriptions depending on the release schedule of new titles and, of course, live content such as sports.

Growth in targeted advertising and monetization. Talking to operators across the region it is interesting to note the rapid growth of targeted advertising. It has progressed over the past year from an optimal add-on to an RFP to a mandatory component of it and is a part of all tenders being put out from all companies at all levels in the market.

We were recently able to publicly announce that our Targeted TV advertising solution is forming an important part of the monetization strategy of HKT’s Now TV. By offering individually tailored advertising experiences to viewers in real-time, Now TV is elevating video experiences, driving new revenue, and attracting advertisers for its IPTV service.

We are also this year seeing keen interest in pushing monetisation beyond the core video services and extending ad tech into new areas encompassing digital lifestyles. The exciting concepts of e-commerce, online shopping via smart home and IoT devices, and gaming are all gaining traction in the region.

The many uses of analytics. We have spent years highlighting the importance of analytics at all relevant touchpoints in the business and are increasingly seeing broadcasters and operators at all levels agree with us. What is impressive is the number of different areas this now impacts, as the amount of real-time data about many different facets of the value chain in particular increases.

AI and its ability to crunch large datasets and look for unique patterns is, of course, a large part of this. It has helped make analytics a truly modular component of any end-to-end offering. The relevant use of analytics in specific areas can increase the Quality of Service by pre-emptively identifying problems in the distribution chain, then improving the Quality of Experience by offering more advanced and granular personalization, increased retention through customer churn risk identification, and more.

Operators are increasingly keen to look at their data and work out where they can make gains that may help their business and strategic planning. And the tools are undoubtedly there nowadays to help them do just that. Hyper-personalization in particular is starting to attract a lot of interest, so it would be reasonable to expect to see some exciting new services in this area launching as the year progresses.

Challenges and opportunities

There are, of course, also other important trends across Southeast Asia in 2024. We are seeing a big upswing in interest in workflow automation, which is also tied into new tools being rolled out that leverage AI and generative AI at all points in the content management and delivery chain. Video piracy is a constant thorn in the side too, so operators and broadcasters are all interested in watermarking and web crawling monitoring services.

Despite the challenges, there are also many opportunities in the region, and operators with the right mix of content libraries — both international and local — and user-friendly experiences, can leverage on increasingly sophisticated ad tech stacks and maximize their monetization opportunities while those utilizing the latest AI-powered analytics tools for understanding their data will likely be the ones thriving in this evolving landscape.

To find out more about all these subjects, and how we can help you unlock your potential for new services or upgrade legacy systems to compete in the new era, meet us at BroadcastAsia 2024, booth 6F2-10. 

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DK Lee

DK Lee is VP Sales APAC for VO, a position he has held since the start of 2020. He has over 20 years experiences in the Asian video business, mainly in the pay media industry and digital platform security areas, and an excellent track record of project wins with many of the major Pay-TV operators in the region. He holds a BA from Kyungpook National University in South Korea.