The evolving consumer appetite for more on-demand and multiscreen viewing is transforming the TV market globally, but no more so than in Asia. Forecasts say that revenues from pay-TV and OTT video in the Asia-Pacific region will be worth $77.4 billion by 2021.
While new varieties of television may be blurring the lines between traditional TV and digital, it’s important to note that consumers aren’t drawing a distinction between the program they viewed on their tablet vs. their internet-connected Smart TV, Amazon Fire TV, or IPTV.
Conversations on Advanced TV in the west are increasingly focused on accessing Connected TV inventory, however, in Asia, they are geared more towards the exponential growth of OTT services. Content in the region is more on-demand than ever before with active OTT SVoD revenues in Asia-Pacific reaching US$10 billion by 2021 from US$6.5 billion today, encompassing 200 million subscribers, twice that of 2016.
The role of telcos in heating up the OTT landscape
The region’s telecom landscape has been a big driver of its OTT market and some of the telcos have even been providing OTT services themselves. The arrival of more regional, low-cost OTT streaming services over the last year or so, and the wide rollout of Netflix in 2016, have made it clear that the market is shifting.
Additionally, the APAC population has high adoption rates of fixed broadband, mobile broadband, and pay-TV services making OTT growth an obvious next stage. Singapore and South Korea, for example, have record pay-TV and smartphone penetration as high as 80%.
In 2018, both consumer and advertiser demand for these services will mean that pay-TV operators throughout the APAC region will need to begin offering more individual- and household-level addressable environments to take advantage of the revolution from a one-to-many to a one-to-one addressable, audience-based and cross-screen approach.
What are the major challenges?
The main hindrance to the growth of the OTT market in Asia is the worrisome broadband infrastructure in some territories and limited access to affordable fixed line services. Across the region, this is holding back the growth of online viewing as is the reach, capacity, and price of mobile broadband for the majority of low-income consumers.
Local language programming is also crucial to the growing acceptance of streaming services in the region. In Thailand and Indonesia specifically, local pay-TV providers are being preferred over OTT services mainly for this reason.
As the Asia-Pacific region continues to be rapidly digitized, consumers expect to access quality content delivered online. Overall, OTT uptake across Asia is very much on the rise with unique partnerships being released within each country over the past few years with the most recent example being the release of OONA in Indonesia.
APAC is a hub that has not been fully exploited by OTT players. A good mix of original content, premium viewing experiences, and innovative delivery plans and packages can turn the tables for both existing and upcoming players.
As the features and capabilities of digital targeting tools and programmatic tech expand—and service providers diversify and expand their offerings—players that find their footing through early trials and experimentation will prove themselves to be the winners.
The future of TV is here, are you ready?
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