MPA Forecasts Positive Second Half for Netflix in Asia


Netflix will end 2021 with about 32.4 million subscribers in the Asia Pacific, according to new analysis from Media Partners Asia (MPA), with 4.5 million net additions in the second half.

The streamer recently revealed slower global growth in Q2 following its lockdown-driven gains in 2020. In the second quarter of this year, AsiaPac contributed two thirds of Netflix’s overall global net new additions.

The fourth quarter of this year will see particularly strong gains for Netflix in AsiaPac, driven by a higher volume of new U.S. and Korean shows. By year-end, MPA projects Australia and New Zealand will represent 24 percent of Netflix’s regional base, with 21 percent in Japan, 20 percent in Southeast Asia, 17 percent in India and 14 percent in Korea.

MPA indicates that a miss in Q4 could be attributed to increased competition from Disney+ and other streamers, maturity in Australia and slowing growth in Japan and Korea, underperformance in India and content regulations in India, Indonesia and other markets.

Netflix had a 32 percent share of SVOD subs in AsiaPac, excluding China, in 2020. MPA expects this will drop to 16 percent by the end of this year. However, its share of SVOD revenues will remain stable at 35 percent, up slightly from 34 percent in 2020.

Risks to its share of SVOD revenues will come from Disney+ gaining traction in high ARPU markets like Japan, Korea and Taiwan; local players in Korea; the continued strength of incumbents in Japan and India and new entrants in Southeast Asia. MPA also cites the risk of content regulations in India and Indonesia and rampant piracy and password sharing in those markets and the Philippines.

In terms of consumer engagement, Netflix dominates the share of premium video consumption in much of the region but remains behind YouTube and TikTok in overall streaming video minutes. U.S. and Korean content continue to boost subscriber acquisition in many AsiaPac territories and local content is driving consumption in markets such as Japan and Korea. With delays in India as the country copes with its latest Covid surges, local content is not yet at scale and is not expected to help drive further subscriber acquisition and engagement there until 2022.