While both subscription video-on-demand services are set to enjoy leadership and rack up collectively nearly 100 million subs and generate around $5 billion in revenues, Disney+ and Netflix are set to show very different growth profiles in the Asia Pacific region in 2021 according to research from Media Partners Asia.
While both subscription video-on-demand services are set to enjoy leadership and rack up collectively nearly 100 million subs and generate around $5 billion in revenues, Disney+ and Netflix are set to show very different growth profiles in the Asia Pacific region in 2021 according to research from Media Partners Asia.
The analyst projects that Netflix in APAC will end the calendar year 2021 with around $3.3 billion in revenues taken from 33.3 million paying subscribers in the region. This compares with 25.5 million subscribers and $2.4 billion in revenue in 2020. Net customer additions for 2021 are projected at 7.8 million, 1.5million fewer than those in 2020.
North Asia will drive momentum for Netflix with Japan set to emerge as its largest revenue generating market in APAC in 2021 and its largest market by subscribers, overtaking Australia. Japan and Korea are both set to continue to propel growth in 2021. Korea remains Netflix’s third largest market in APAC by revenues. Australia is Netflix’s most mature market with over 60% household penetration. In a broader sense, Southeast Asia continues to grow in this regard, led by Philippines and Thailand.
Local content investment will also be a key factor for Netflix in 2021. The offering continues to broaden in depth and appeal in Japan, Korea and India which will be at the vanguard of localisation. Total cash content costs on local originals and acquisitions is expected to reach US$1 billion in the 2021 calendar year.
However, MPA warns that the Netflix faces a number of regulatory headwinds. At the head of these are increasing content censorship and regulatory scrutiny in India and Indonesia while network cost issues could grow in Korea.
By contrast, Disney+ is set to accelerate growth strongly in Asia Pacific over the year. The service is projected by MPA to end the calendar year having taken $1.2 billion in revenues from 66 million paying subscribers. This is just over double the amount signed up in 2020, and almost more than double the yearly revenue generated. The revenues include subscriptions from direct-to-consumer and wholesale channels as well as from advertising in India.
But the analyst notes that the year will see a tale of two Disneys. Disney+ Hotstar - the mass market service in India with broadening appeal in Indonesia and launching in Malaysia, the Philippines and Thailand – is forecast to have blended monthly ARPU of ~US$1 and total paying subs of 59 million in 2021. By contrast, Disney+ in the ANZ region, Japan, Korea, Singapore, Hong Kong and Taiwan is projected to have a blended monthly ARPU of US$8.5 in 2021 with total subs of 7.5 million.
Overall, India remains Disney+’s major growth engine. The service’s broadest offering in the country will be through Disney+ Hotstar with its product anchored to premium sports, local & regional entertainment, Disney+ franchises and Hollywood entertainment (including shows from HBO). MPA projects Disney+ Hotstar to end the 2021 calendar year with more than 50 million subs at low ARPUs and total revenues, including advertising and subscription, of US$500 million. Growth beyond 2021 will likely be dependent on important sports rights renewals.
APAC Disney+ paying subscribers and revenues outside of India for are expected to reach 16 million and US$700 million respectively. Subscriber growth in 2021 will be driven by Indonesia and ANZ in addition to new launches in Korea, Malaysia and Thailand.
Revenue growth will be driven by ANZ - bolstered by price increases with the rollout of Star under Disney+- as well as Southeast Asia, Korea and Japan. MPA noted that local content investment and recurring subscriber-based distribution partnerships with telcos and third parties will be critical to sustained growth in Korea, Indonesia and Japan..
The analyst projects that Netflix in APAC will end the calendar year 2021 with around $3.3 billion in revenues taken from 33.3 million paying subscribers in the region. This compares with 25.5 million subscribers and $2.4 billion in revenue in 2020. Net customer additions for 2021 are projected at 7.8 million, 1.5million fewer than those in 2020.
North Asia will drive momentum for Netflix with Japan set to emerge as its largest revenue generating market in APAC in 2021 and its largest market by subscribers, overtaking Australia. Japan and Korea are both set to continue to propel growth in 2021. Korea remains Netflix’s third largest market in APAC by revenues. Australia is Netflix’s most mature market with over 60% household penetration. In a broader sense, Southeast Asia continues to grow in this regard, led by Philippines and Thailand.
Local content investment will also be a key factor for Netflix in 2021. The offering continues to broaden in depth and appeal in Japan, Korea and India which will be at the vanguard of localisation. Total cash content costs on local originals and acquisitions is expected to reach US$1 billion in the 2021 calendar year.
However, MPA warns that the Netflix faces a number of regulatory headwinds. At the head of these are increasing content censorship and regulatory scrutiny in India and Indonesia while network cost issues could grow in Korea.
By contrast, Disney+ is set to accelerate growth strongly in Asia Pacific over the year. The service is projected by MPA to end the calendar year having taken $1.2 billion in revenues from 66 million paying subscribers. This is just over double the amount signed up in 2020, and almost more than double the yearly revenue generated. The revenues include subscriptions from direct-to-consumer and wholesale channels as well as from advertising in India.
But the analyst notes that the year will see a tale of two Disneys. Disney+ Hotstar - the mass market service in India with broadening appeal in Indonesia and launching in Malaysia, the Philippines and Thailand – is forecast to have blended monthly ARPU of ~US$1 and total paying subs of 59 million in 2021. By contrast, Disney+ in the ANZ region, Japan, Korea, Singapore, Hong Kong and Taiwan is projected to have a blended monthly ARPU of US$8.5 in 2021 with total subs of 7.5 million.
Overall, India remains Disney+’s major growth engine. The service’s broadest offering in the country will be through Disney+ Hotstar with its product anchored to premium sports, local & regional entertainment, Disney+ franchises and Hollywood entertainment (including shows from HBO). MPA projects Disney+ Hotstar to end the 2021 calendar year with more than 50 million subs at low ARPUs and total revenues, including advertising and subscription, of US$500 million. Growth beyond 2021 will likely be dependent on important sports rights renewals.
APAC Disney+ paying subscribers and revenues outside of India for are expected to reach 16 million and US$700 million respectively. Subscriber growth in 2021 will be driven by Indonesia and ANZ in addition to new launches in Korea, Malaysia and Thailand.
Revenue growth will be driven by ANZ - bolstered by price increases with the rollout of Star under Disney+- as well as Southeast Asia, Korea and Japan. MPA noted that local content investment and recurring subscriber-based distribution partnerships with telcos and third parties will be critical to sustained growth in Korea, Indonesia and Japan..
