Data: Southeast Asian Online Video Revenue to Reach $4.5 Billion by 2025

Over-the-top video distribution in Southeast Asia continues to proliferate. Total online video market revenue in the region projected to rise to $4.5 billion by the end of 2025, according to new data from London-based research firm Omdia. By 2025, it is forecast that 62% revenue will come from ad-supported VOD and free ad-supported streaming television, or FAST.

Last year, total online video revenue in key Southeast Asia markets, including Indonesia, Malaysia, the Philippines, Singapore, Vietnam and Thailand, reached $1.8 billion.

In 2020, the ad-supported segment led the online video with 71% of total revenue. Omdia projects that the subscription-based online video will increase market share from 28% to 37% of total online video revenue through 2025. Transactional VOD makes up less than 1% of total market share.

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With Facebook and YouTube’s popularity in this region is unilateral, this duopoly will remain the biggest contributors to ad-supported video revenue. Omdia estimates 75% of video ad revenue comes from mobile devices and 20% from PCs. Though only 5% is from connected TVs, Omdia expects the CTV segment to grow during the forecast period, albeit at a slower pace than in the U.S. and Western European markets.

“This [revenue growth ] trend is bolstered by more direct-to-consumer OTT video service launches in this region, broadcasters’ ongoing efforts to strengthen their position in the premium video ad marketplace and growth of local and regional players as a result of more enhanced partnerships between content and service providers,” Kia Ling Teoh, senior research analyst at Omdia, said in a statement.

Fellow researcher Jun Wen Woo contends the subscription VOD market will continue to grow with pay-TV and telecom operators adopting more of an hybrid streaming/broadcast business model. He said as increased competition introduces flexible, modular tariff structures that allow users to personalize and customize their online video entertainment selections, revenue will grow.

“Given the low credit card penetration in the region, offering more local payment options—mobile wallet, scratch card, and local bank transfer—will remain important to increase conversion to paid users,” Wen Woo said.

Report: Domestic AVOD Monthly Viewers Reach 200 Million

The number of OTT video services used per OTT video user has risen to more than 7.2 different services per month in the United States, according to new data from London-based research firm Omdia. The increase in online video usage across the globe in 2020 has been driven by a greater uptake of subscription video platforms, which in turn has led to consumers to look for content across AVOD platforms.

Globally, the number of AVOD active monthly users has increased in 2020 compared with 2019. India leads the globe in terms of monthly active users on AVOD platforms with more than half a billion free AVOD users. The U.S. is second with nearly 200 million free AVOD users. Not only did monthly active users increase, but so did the frequency of viewing, highlighting a greater conversion rate to daily usage.

Nearly two-thirds of AVOD users access such services on the TV screen. In early 2020, smart-TV apps overtook the set-top box as the most used device to access free AVOD services. This was primarily driven by improved availability and greater usage of broadcaster VOD services on smart TVs in the U.K. and Germany.

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“The simultaneous rise in both subscription online video and free AVOD consumption highlights increasing consumer awareness around content access,” Fateha Begum, principal analyst at Omdia, said in a statement.

The TV set is increasingly becoming a key medium for user-generated content. In 2020, nearly four in 10 YouTube users access the service on a TV screen via one of many connected devices the service is available on. Of those accessing the service via a TV screen, 63% used smart-TV apps. Video sharing app TikTok made its way to Samsung smart TVs in the U.K. in 2020, with further European launches expected in 2021.

There is a direct correlation between the number of subscription video services and the number of free AVOD services used per month by country.  eight in 10 free AVOD users across the seven markets subscribe to an online video service and seven in 10 have pay-TV.

In the U.K. the number of online video services used on a monthly basis has grown to 5.4 from 4.9 in 2019, with France (4.6), Germany (3.9) and Brazil (4.5) all showing increased demand for content. India is the only market where the number of video services has dropped, from 9.1 in April 2020 to 8.9 in November 2020, but it is still up year over year.

Over the next three years Omdia forecasts that global online advertising revenue is set to hit almost $120 billion, consistently outperforming subscription video services by just over 20%.

As linear-TV advertising revenue falls across many markets globally due to the rise of online video consumption, broadcasters have sought revenue by offering a ‘freemium’ content proposition online. Revenue is generated by incentivizing consumers to pay a monthly fee to upgrade or via advertising revenues from lower tiers.

The implications for commercial broadcasters mean that over time there will be more and more hybrid solutions coming into the market, where there is a balancing act between AVOD and SVOD models. Over the past few years, traditional broadcasters’ share of online video revenue has decreased due to the duopoly of Facebook and Google, however Omdia expects that their market share is to marginally increase over the next three years.

“AVOD users show a high propensity to consume content; they are content hungry, not cost conscious,” Begum said. “As on AVOD services grow in popularity and improve their content offering and device accessibility, paid services will have to work harder.”

Report: Streaming Video Services to See Subscriber Growth Slowdown in 2021; Apple TV+ to Lose 8 Million Subs

Approaching 2021 could see a significant slowdown in subscriber growth among major subscription streaming video services, according to new data from Omdia/Informa Tech. The London research firm said that following outlier sub growth this year due to the pandemic among major services such as Netflix and Disney+, sustaining a similar growth curve next year could be challenging. Omdia said SVOD services worldwide added a combined 226 million subs in 2020.

“All industries and economies tend to move between waves of growth and pools of stagnation and SVOD is no exception,” Rua Aguete, senior director of media and entertainment, said in a note. “While 2020 was a year for the records, 2021 will be a year of industry-wide cooling despite the myriad services coming from big Hollywood players including Discovery, NBCUniversal, ViacomCBS and WarnerMedia.”

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Not surprisingly, Netflix, Apple TV+, Disney+ and Amazon Prime Video all saw significant net sub adds stemming from pandemic-affected markets. In 2021, these services are expected to see declines, with Netflix and Prime Video eyeing their slowest sub growth since 2015.

Netflix and Disney+ had 195 million and 86.8 million subs at the end of the third quarter (ended Sept. 30) and Dec. 2, respectively.

Notably, Aquete  estimates AppleTV+ will lose 8 million subs by the end of 2021, due in part to the termination of free 12-month trials and relative lack of original content compared to competing services.

“The reason for this stark contrast with the year before is that SVOD, more than many other types of entertainment, must maintain a healthy pipeline of potential new subscribers and carefully manage the high level of churn that is incumbent to monthly subscription products,” she said. “2020 has seen this pipeline exhausted; new subscribers have been converted at astonishing rates and the pool of subscribers in potential have been vastly reduced.”

To sustain sub growth, Aquete said SVOD services such as Netflix need to partner with pay-TV operators and telecoms providing direct access and integrated content libraries to their subs.

“2020 may have been a year of hubris for the SVOD industry, booming as all others struggled, but 2021 will be a year of humility; for the first time big SVOD players must rely on former rivals for their own success,” Aquete said.

Disney+ Tops 4.3 Million Subs in United Kingdom in One Month

Subscription streaming video service Disney+ ended April as the United Kingdom’s third-largest SVOD player, with 4.3 million subscribers — just weeks after launching on March 24, according to new data from Omdia Consumer Research.

Disney’s SVOD service has a 16.8% market share, which trails Netflix and Amazon Prime Video, which claimed 58.4% and 46.9% market share, respectively.

“Disney+ arrived in the U.K. just as COVID-19 social distancing and quarantine measures commenced,” Maria Rua Aguete, senior research director of video, TV and advertising for Omdia, said in a statement. “Streaming services … have become the biggest winners during the lockdown as consumers have sought new entertainment experiences to keep themselves entertained.”

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Aguete said current catalogs offered by SVOD services have become increasingly alluring to viewers, given than the pandemic has halted production of new video content.

Streaming services such as Disney+ are also reaping the benefits as subscriptions fall for competitive pay TV and over-the-top (OTT) sports-focused platforms, such as DAZN,

These same dynamics are also propelling the success of Disney+ in other regions. Disney is now the fourth-ranked SVOD provider in the United States. Disney in April claimed 25% of U.S. SVOD subscribers, compared with 29% for Hulu, 47% for Prime Video and 60% for Netflix. One out of four U.S. households now has access to Disney+, Omdia’s survey revealed.

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