As the transition to Internet TV gains momentum, the Asia Pacific online video industry, China excluded, is on track to more than double its share of industry revenues from 9% in 2017 to 20% by 2023, according to Media Partners Asia (MPA) analysis.
The analysis, covering 12 markets — Australia, India, Japan, Korea, Hong Kong, Taiwan and six key markets in Southeast Asia — found that the region was fundamentally a landscape dominated by traditional TV. Even though it was a slower-growth industry, MPA believes that the traditional segment will stay dominant for some time yet, claiming an 80% market share by 2022.
Apart from in China, the study found that subscription and ad-supported video services from the FANG companies — Facebook, Apple, Netflix and Google — were set to retain a combined 63% share of Asia Pacific online video revenues by the end of 2018.
The study shows that Google-owned YouTube’s dominance is reflected by its 70-90% slice of a large and fast-growing online video ad pie in Australia, Japan, Southeast Asia and India. Amazon and Netflix have also scaled quickly with subscription video offerings in Australia, India and Japan. However, MPA noted that the latter two have a long way to go in Southeast Asia and Korea and that there was a long runway for more growth in India.
MPA also found that local and regional players with entertainment and sports IP were making incremental gains, especially in India, Japan and Korea. Together with, in many instances, large TV businesses, these players have invested in online video platforms to grab a bigger market share. This it said was especially true in India, Korea and Japan, although Southeast Asia was found to be lagging.
“The growth of subscription and ad-supported video services from Amazon, Facebook, Netflix and Google will propel these FANG companies to a combined 63% share of Asia Pacific online video revenues ex-China by the end of 2018,” said MPA executive director Vivek Couto. “The outlook remains in FANG’s favour however, with its aggregate market share maintained at 62% in 2023. Such scale will dramatically alter growth and investment dynamics across key markets. We see significant upside for local and regional media platforms with attractive IP and strong execution as well as the appetite and patience to invest over the long term across digital video. FANG’s share could also be greater once Amazon Prime Video scales up in Australia and key markets across Southeast Asia. This is not yet included in the assumptions underlying MPA’s analysis.”
The survey also showed that total content investment in TV and online video across the 12 surveyed markets reached US$23.1 billion in 2017, up 6% year-on-year. MPA’s analysis includes movies, entertainment and sports. Content investment is expected to scale to US$30.1 billion by 2023, a 5% CAGR from 2018. Such growth said MPA was largely anchored to new dollars being spent across online video, which will account for 17% of content investment by 2023 versus 10% in 2018. MPA noted that its analysis focused on premium video content creation across TV and over-the-top (OTT) but excluded costs associated with the billions of hours being mass produced and uploaded on YouTube.
Also excluded in the MPA analysis were potential all-in premium offerings from Disney, 21st Century Fox and Time Warner, which the company predicted were likely to start gaining traction at some point over the next five years as global media consolidation accelerated.
Apart from in China, the study found that subscription and ad-supported video services from the FANG companies — Facebook, Apple, Netflix and Google — were set to retain a combined 63% share of Asia Pacific online video revenues by the end of 2018.
The study shows that Google-owned YouTube’s dominance is reflected by its 70-90% slice of a large and fast-growing online video ad pie in Australia, Japan, Southeast Asia and India. Amazon and Netflix have also scaled quickly with subscription video offerings in Australia, India and Japan. However, MPA noted that the latter two have a long way to go in Southeast Asia and Korea and that there was a long runway for more growth in India.
MPA also found that local and regional players with entertainment and sports IP were making incremental gains, especially in India, Japan and Korea. Together with, in many instances, large TV businesses, these players have invested in online video platforms to grab a bigger market share. This it said was especially true in India, Korea and Japan, although Southeast Asia was found to be lagging.
“The growth of subscription and ad-supported video services from Amazon, Facebook, Netflix and Google will propel these FANG companies to a combined 63% share of Asia Pacific online video revenues ex-China by the end of 2018,” said MPA executive director Vivek Couto. “The outlook remains in FANG’s favour however, with its aggregate market share maintained at 62% in 2023. Such scale will dramatically alter growth and investment dynamics across key markets. We see significant upside for local and regional media platforms with attractive IP and strong execution as well as the appetite and patience to invest over the long term across digital video. FANG’s share could also be greater once Amazon Prime Video scales up in Australia and key markets across Southeast Asia. This is not yet included in the assumptions underlying MPA’s analysis.”
The survey also showed that total content investment in TV and online video across the 12 surveyed markets reached US$23.1 billion in 2017, up 6% year-on-year. MPA’s analysis includes movies, entertainment and sports. Content investment is expected to scale to US$30.1 billion by 2023, a 5% CAGR from 2018. Such growth said MPA was largely anchored to new dollars being spent across online video, which will account for 17% of content investment by 2023 versus 10% in 2018. MPA noted that its analysis focused on premium video content creation across TV and over-the-top (OTT) but excluded costs associated with the billions of hours being mass produced and uploaded on YouTube.
Also excluded in the MPA analysis were potential all-in premium offerings from Disney, 21st Century Fox and Time Warner, which the company predicted were likely to start gaining traction at some point over the next five years as global media consolidation accelerated.
