U.S., Korean Content Drive SEA Online Video Gains

Southeast Asia added 4.6 million net new paying customers in Q4 2022, the biggest growth since the second quarter of 2021, according to a new report from Media Partners Asia (MPA), with U.S. and Korean content driving SVOD viewership in the region.

SEA Online Video Consumer Insights & Analytics tracks the streaming sector in Indonesia, Malaysia, the Philippines, Singapore and Thailand. It reports that the region was home to 48.4 million paid online video subscribers at the end of 2022, a gain of 11.8 million net new customers in the year. The second half alone saw the addition of 7.3 million new subs.

The significant Indonesian market drove the region’s gains, contributing to 50 percent of the new additions in Q4 and 51 percent throughout the year. Indonesia and Thailand account for 75 percent of all SVOD subs in the region.

By platform, meanwhile, Vidio and Viu led the Q4 subscriber gains, accounting for more than half of new subscriptions. Disney, Netflix and Prime Video secured 34 percent of new additions. In terms of the overall SVOD base, Disney, Viu and Netflix have 52 percent of all subs.

In terms of viewership, Netflix leads with a 40 percent share, with Viu in a distant second at 13 percent and WeTV at 10 percent. In terms of content origin, U.S. titles accounted for 32 percent of viewership, followed by South Korea at 25 percent, Southeast Asia at 13 percent, Japan at 11 percent and China at 10 percent. Per MPA, local content (particularly Thai and Indonesian) drives customer acquisition and retention.

Commenting on the findings of the report, Vivek Couto, executive director of MPA, noted: “2023 is likely to be heavily focused on customer retention, churn management and implementing price increases. Key players will continue to invest in localization and the strategic marketing of premium Korean, U.S. and sports content but against the background and investor mantra of capital efficiency. A number will focus on building local and differentiated entertainment content to drive customer growth and monetization in 2023. While local movies and series have unlocked customer acquisition, especially in Indonesia, more sustained episodic and differentiated local entertainment will be required to drive engagement, revenue and profitability.”

Dhivya T, lead analyst and head of content insights, added: “As consumers grow weary of content fragmentation and monthly billing, platforms are expected to focus on deepening customer and brand value as well as big screen engagement and other new strategies to retain subscribers. Freemium platforms Vidio and Viu are bolstering paid content tiers by moving previously free content to SVOD while securing exclusive streaming access to content (i.e. Korean, local and anime) to attract new subscribers. Exclusive licensing of multiplatform content categories such as Japanese anime is on the rise, along with competition for exclusivity and differentiation in new Korean dramas. Korean demand remains strong but expensive. Between Netflix, Viu, Disney and Amazon, 70 new and exclusive Korean dramas were released last year with strong SVOD impact. It remains to be seen if platforms will continue to invest in three to seven new Korean dramas per quarter as ROI comes under the microscope. Greater localization is allowing U.S. and Korean tentpoles to achieve new levels of reach in SEA, with local subtitles commonplace and dubbing on the rise, especially on Netflix’s new U.S. and Korean releases. High-profile and creative local marketing campaigns (i.e., Alice in Borderland in the Philippines, Reborn Rich in Indonesia etc.) are also proving impactful in driving growth in engagement and customers. Finally, 2022 arguably belonged to TikTok more than any platform; its share of total SEA online video viewership grew from 24 percent in 2021 to 35 percent in 2022, eating into YouTube and premium video. Daily time spent on TikTok exceeded all video platforms in SEA except Thailand, where YouTube leads.”