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AsiaPac Online Video Market Worth $12.4 billion by 2020

From Media Partners Asia

MPA

Revenues from online video services in 13 markets across the Asia Pacific will rise from $3.5 billion last year to $12.4 billion by 2020, when there will be some 977 million OTT customers across the region, according to new projections from Media Partners Asia.

Advertising will dominate online video revenues, accounting for some 80 percent of the total pie, according to the Asia Pacific Online Video Distribution 2015 report. Subscription revenues, largely for SVOD platforms, will rise from $700 million in 2014 to $2.3 billion by 2020. There were 594 million active OTT customers across AsiaPac in 2014—85 percent of which are in China. The other key OTT markets in 2014 were Korea, India, Japan and Hong Kong. By 2020, there will be some 977 million OTT customers. China will remain the biggest OTT market, with 80 percent of customers, followed by India, Korea, Japan and Hong Kong. Malaysia and the Philippines will be the leading OTT markets in Southeast Asia. The market for subscription-based OTT will rise to 225 million by 2020 from 75.3 million last year, again led by China. On the subscription front, there will be opportunities in Japan, Korea, India and Australia. India will largely be a free ad-supported model, MPA predicts.

“The market for the legal consumption of OTT services in Asia Pacific is at an early stage with monetization models nascent in most countries,” said Vivek Couto, MPA’s executive director. “As barriers to entry reduce and broadband penetration increases, more disruptors are emerging and a host of new platforms are proliferating, though business models are not always scalable and issues such as piracy, content and platform operation remain problematic. This is especially true in a number of Asian markets where piracy is significant and the limited scale of OTT video revenues are not commensurate with content costs.

Meanwhile, large-scale global digital brands (from YouTube through to Netflix) are expanding rapidly in a number of Asian markets or readying to launch in key territories over 2015 and 2016. Major local and regional television companies are also in the early stages of launching a number of large-scale advertising and subscription-based OTT platforms, anchored to local, Asian and Hollywood content, while telecom operators are either moving upstream into content and OTT services or providing a crucial link for the ecosystem.”

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