By 2025, AsiaPac online video revenues will reach $54.5 billion, according to new Media Partners Asia (MPA) research, with SVOD accounting for 57 percent of the market and AVOD 43 percent.
MPA’s Asia Pacific Online Video & Broadband Distribution 2021 report notes that online video revenues in 2020 reached $30.5 billion, a 14 percent year-on-year gain. SVOD took the lead in 2020, generating 53 percent of revenues. Excluding China, however, AVOD has the lead at 52 percent of total revenues of $14 billion. Ex-China, online video revenues are forecast to rise by a compound annual growth rate (CAGR) of 16 percent to reach about $30 billion in 2025, with SVOD taking a 52-percent share.
The average number of SVOD subscriptions per customer hit 3.8 in Australia and Japan and 2.8 in markets such as India and Southeast Asia, driven by the pandemic. “While subscriber growth will decelerate in 2021 and the production of new content will remain impacted in 1H 2021, the scale and velocity of investment in premium content should ensure that net new customer additions will remain robust over the medium term,” said Vivek Couto, executive director of MPA. “Moreover, profitability should grow more rapidly than revenues and subscribers as online businesses scale. This is particularly true in larger markets such as Australia, China, Japan and Korea.”
SVOD revenues were up 34 percent in 2020 to reach $16.3 billion, with China accounting for 58 percent (down from the peak of 67 percent in 2017). Excluding China, revenues hit $6.8 billion, a 47 percent gain, with Japan, Australia and New Zealand accounting for 70 percent. SVOD subs in China are set to hit 375 million in 2025, up from 298 million last year. On the AVOD side, YouTube leads with 60 percent of revenues across AsiaPac, excluding China.
According to MPA, 13 online video operators accounted for more than 70 percent of Asia Pacific online video revenues last year. By subs, Tencent is the leading SVOD operator in AsiaPac, followed by iQIYI, Alibaba/Youku, Disney+ and Disney+ Hotstar, Netflix and Prime Video. By revenues, YouTube is ranked number one, followed by Tencent, iQIYI, ByteDance, Netflix, Youku, Amazon Prime, Disney, UNextm Nine, Hulu Japan, Waave and PCCW Media/Viu.
“Netflix has built a strong business in Asia Pacific, generating an estimated US$2.5 billion in revenue in 2020 on the back of growing success in Japan, Korea and Australia and the popularity of its premium Asian content (Korean and Japanese) and global originals,” says MPA’s Couto in exclusive analysis provided to World Screen. Japan and Korea accounted for 40 percent of the streaming giant’s AsiaPac membership base last year. According to MPA, Disney+ ended 2020 with more than 30 million subs, 80 percent of which were in India. “The launch of Disney+ Hotstar in Indonesia has met with early success, especially in terms of reach and paid subscribers,” Couto says. “The core Disney+ service has succeeded in ANZ and is growing in Japan. Both markets will benefit from the launch of Star (as part of Disney+) in 2021 as access to series and movies from ABC, Fox and FX brands should help drive customer growth and ARPU expansion.”
Looking ahead, HBO Max could arrive in India and Japan beginning in 2022. Paramount+ will land in Australia and New Zealand in 2021 and potentially Japan and Korea in the future. Discovery+ is in India and is looking to expand further in Japan.
This year will also see further expansion of the Chinese majors iQIYI, Tencent Video and Tiktok. “Both Tencent and iQIYI are hoping their premium Chinese dramas and movies scale in Southeast Asia while they add anime, Korean content and where relevant local acquisitions and originals. Tencent Video’s WeTV has been particularly successful in Thailand (bolstered by local content) and has started to grow meaningfully in Indonesia.”