By Chairil Anwar, Business Development Director APAC
It’s been an interesting 12 months for the Asian TV market and with APOS less than a week away it’s a good time to take stock of the challenges we’ve faced and look at the opportunities for operators in the future.
Initiatives such as TV Everywhere have been gaining momentum in Asia over the last few years as broadcasters hop onto the OTT bandwagon. For incumbent pay TV operators, TV Everywhere has been an innovation that has added a layer of complexity to an already faltering business model. They have not been able to risk cannibalising their core business to be truly innovative in terms of packaging and pricing with their OTT plays.
As a counter point, players less entrenched, i.e. IPTV providers like IndiHome, have been able to adopt technological innovations and modernise in terms of packaging and pricing. They have been able to offer channels on a skinny bundle and/or a-la-carte basis. This is where the cord shavers and cutters are addressed and where the base incremental revenues lie.
We also saw Netflix and Hulu rise and regional 3rd party OTT video service providers, like iFlix and Viu, really shake up the market.
For a while there it looked as though these IPTV and pure play OTT providers were taking over. However, it hasn’t all been plain sailing. The apparent rescinding of the TPP has allowed for some players to block Netflix on their networks. How this pans out will be very interesting.
And these regional OTT video services providers that disrupted the market last year have seen great gains, however as the dust settles the realities of metrics such as active subscribers, paying subscribers and renewals are slowly emerging leaving a unique opportunity for traditional Pay-TV operators to catch up, as long as they get their commercial and content strategies right. So, what should these strategies look like?
When it comes to content, you need to know your audience and what they want. When Grey Juice Lab moved into Asia five years ago operators were asking for as much as 75% Hollywood/Western content vs only 25% Vernacular content. But, while Game of Thrones and The Walking Dead are still incredibly popular, we’re also seeing demand from viewers for more vernacular content. As a result, that content ratio has moved closer to 50:50 and is in fact now favouring Vernacular content in some instances. There is much interest in TV dramas from Latin America (i.e. Pablo), Turkey and the Nordic countries. Also, news / factual programming providers such as RT, CCTV and PressTV are doing surprisingly well.
When it comes to commercial strategies, we should be cognisant of what Netflix, Hulu and more relevant to this region, iFlix do not offer. No new releases (apart from their own productions, as is the case for Netflix), no download-to-own (EST), and certainly no linear channels or live events. Thus, the opportunities for operators to succeed with Vernacular content offers (SVOD and otherwise), skinny bundles, a-la-carte premium channels, TVOD, EST and live events are still very much up for grabs.
The key is developing a content strategy and appropriate business model that meets your own specific targets and goals. The discovery process requires deep analysis and deeper planning. This is key.
At Grey Juice Lab, we are well placed to assist operators with developing content and commercial strategies that drive growth and revenue. Meet us at APOS to find out more.