Internet closes in on TV as Asia Pacific ad revenues hit US$170BN | Media Analysis | Business
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Advertising revenues in 14 Asia Pacific markets grew by 6.8% to reach US$170 billion net in 2016, with the Web overtaking TV as the favoured medium in some, according to a Media Partners Asia (MPA) report.

MPA said the growth compares with 8.5% expansion in 2015, and forecasts ad spend across these markets will increase by another 6.4% in 2017 with a 4.9% CAGR expected between 2017 and 2022.

India, which is set to become the region’s best performing market, is expected to overtake Australia as the region’s third largest ad market by 2022, after China and Japan. Australia will fall to fourth place, while Korea will remain in fifth, said the analyst. China, the region’s biggest advertising market, will see net ad revenue reach US$121 billion by 2022, from US$90 billion in 2017, said MPA.

“Future growth is becoming more challenged, as markets mature and working populations stagnate or decline. This leaves China and India as the main dynamos of advertising growth. While Indonesia, the Philippines and Thailand are also important growth economies, they lag China and India in scale. Growth trajectories for the region’s other scale markets, Australia, Japan and Korea, are markedly lower than they have been in the past, especially for Korea,” said Vivek Couto, executive director, MPA.

Advertising on the Internet climbed 20.8% in 2016 to raise US$66 billion across the 14 markets in MPA’s report. It became the biggest medium for advertising in Australia, China, Korea, New Zealand and Taiwan in 2016, and by 2022, Hong Kong, Japan and Singapore are forecast to join their ranks.

Television advertising remains strong in many countries, especially India, Indonesia, Japan, the Philippines, Thailand and Vietnam. However, as a whole TV ad spend shrunk very slightly (0.5%) in 2016 across the total surveyed territories, mainly as free-to-air broadcasters are suffering falling ad revenues in Australia, Korea, Hong Kong, Malaysia and Singapore. Despite this, TV will remain the largest advertising medium in India, Indonesia, the Philippines, Thailand and Vietnam in 2022, said MPA, with the Internet coming in second.

“Consumers are spending more time on mobile, social and online video platforms, driving demand for internet advertising,” Couto added. “In most places, Google, including YouTube, and Facebook are dominant. In some markets however, especially in India, Japan and Korea, local digital players, as well as key incumbents in TV and print, are beginning to grab a bigger slice of the pie. China, meanwhile, is entirely dominated by a local ecosystem.”

The market analysis for MPA’s annual Asia Pacific Advertising Trends comprise: Australia, China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, New Zealand, the Philippines, Singapore, Taiwan, Thailand and Vietnam.