ABOUT US ASIA PACIFIC ONLINE VIDEO DISTRIBUTION 2015 I
PRESS RELEASE MPA report values Asia Pacific online video revenue oppportunity at US$12 bil. by 2020 (Hong Kong / Singapore / India, January 12, 2015) A research report published today by Media Partners Asia (MPA) indicates that the total market for online video services across 13 countries in Asia Pacific will grow from US$4.7 billion in net revenues in 2014 to reach US$12.4 billion by 2020, representing a average annual growth of close to 21%. Advertising will contribute more than 80% to the online video pie by 2020 with the subscription revenue opportunity, largely driven by subscription video-on-demand (SVOD) platforms, growing from less than US$700 mil. in 2014 to more than US$2.3 bil. by 2020. The report, entititled, evaluates the commercial distribution of legal over-the-top (OTT) video services in 13 markets with historical data and forecasts plus profiles of key OTT platforms. Commenting on the report, MPA executive director Vivek Couto said: The market for the legal consumption of OTT services in Asia Pacific is at an early stage with monetization models nascent in most countries. As barriers to entry reduce and broadband penetration increases, more disruptors are emerging and 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. Key takeouts from the report include: Infrastructure. Fixed broadband subscribers reached 325.3 million in 2014 across Asia Pacific, equivalent to an average household penetration rate of 36%. By 2020, MPA projections indicate that this penetration level will reach 40% as fixed broadband subs grow to 403.5 mil. Mobile broadband will grow rapidly, expanding at CAGR of 15% over 2014 and 2020 to reach almost 2 bil. subs by 2020 (58% penetration of population) versus 866 mil. (26% penetration) in 2014. OTT Video Consumption. Active Asia Pacific OTT video 1 subscribers reached 494 mil. in 2014, according to MPA. China accounted for more 85% of the market size in 2014 and will represent 80% by 2020. Ex-China, the largest markets in 2014 were Korea; India; Japan; and Hong Kong. By 2020, MPA projections indicate that active OTT video customers will reach 977 mil. By 2020, in Asia ex-china, India will emerge as the second largest market, followed by Korea, Japan and Hong Kong. In Southeast Asia, Malaysia will be joined by Indonesia and the Philippines as market leaders. The market for subscription-based OTT video reached 75.3 mil. active subs in 2014 and is expected to reach 225 mil. by 2020. China will be the largest contributor, driven by internet- 1 Active OTT subscribers are defined as customers that have been actively consuming video content via a service in the preceding thirty days II
PRESS RELEASE enabled TV and set-top box platforms and online video companies offering premium services. Japan, Korea, India and Australia will emerge as material opportunities, powered by SVOD but India will trend towards more a freemium-oriented model. Industry economics. MPA divides industry monetization models into distinct segments: SVOD. In terms of SVOD revenue across OTT platforms, the largest markets in Asia Pacific by 2020 will be Japan; China; Korea; and Australia. New Zealand and India will lead the next best placed group of geographies. MPA projections indicate that total SVOD-based OTT revenues in Asia Pacific will grow at a CAGR of 16% between 2014 and 2020, growing from US$953 mil. in 2014 to more than US$2.3 bil. by 2020. Online video and OTT advertising. Asia Pacific online video advertising exceeded US$3.7 bil. in net terms in 2014, up 35% year-on-year. The largest markets for online video advertising in 2014 were, by far, China and Japan, followed by Australia, India and Korea. By 2020, the total Asia Pacific online vide advertising pie is expected to grow to US$10 bil., a CAGR of 18% from 2014, with China dominant, followed by Japan. India will gain increasing scale and overtake Korea while Indonesia will be the clear leader in Southeast Asia. OTT video advertising revenue, a subset of the online video advertising pie, reached US$2.1 bil. in 2014, up 43% year-on-year from a low base, and almost entirely driven by China. This pie, is projected by MPA to expand to US$5.5 bil. by 2020 at a CAGR of ~18%. China will be the largest contributor with India, Korea and Indonesia starting to become gradually significant over time. III
TABLE OF CONTENTS Executive Summary 1 Methodology & Definitions 1 Overview 2 Asia Pacific OTT Market Landscape 4 Key Challenges 5 Five For The Future 8 Asia Pacific Total Active OTT Video Subscribers (2012 20) 10 Asia Pacific Total OTT Pay Subscribers (2012 20) 11 Asia Pacific OTT Subscription Revenue (2012 20) 11 Asia Pacific Average OTT Monthly ARPU (2012 20) 12 Asia Pacific OTT Advertising Revenue (2012 20) 12 Asia Pacific Total OTT Revenue (2012 20) 13 Asia Pacific Online Advertising Revenue (2012 20) 13 Asia Pacific Online Video Advertising Revenue (2012 20) 14 Asia Pacific Total Broadband Subs (2012 20) 14 Asia Pacific Fixed Broadband Subs (2012 20) 15 Asia Pacific Wireless Broadband Subs (2012 20) 15 Asia Pacific Fixed Broadband Subscribers - Penetration of HHs (2012 20) 16 Asia Pacific Wireless Broadband Subscribers - Penetration of Population (2012 20) 16 Australia OTT Market Landscape (2012 20) 17 China OTT Market Landscape (2012 20) 18 Hong Kong OTT Market Landscape (2012 20) 19 India OTT Market Landscape (2012 20) 20 Indonesia OTT Market Landscape (2012 20) 21 Japan OTT Market Landscape (2012 20) 22 Korea OTT Market Landscape (2012 20) 23 Malaysia OTT Market Landscape (2012 20) 24 New Zealand OTT Market Landscape (2012 20) 25 Philippines OTT Market Landscape (2012 20) 26 Singapore OTT Market Landscape (2012 20) 27 Taiwan OTT Market Landscape (2012 20) 28 Thailand OTT Market Landscape (2012 20) 29 Market Profiles 30 Australia 30 China 35 Hong Kong 42 India 47 Indonesia 54 Japan 59 Korea 64 Malaysia 70 New Zealand 75 Philippines 80 Singapore 85 Taiwan 89 Thailand 93 Platform Briefs 98 Pan-Asia 98 Spuul 98 Viki 98 IV
TABLE OF CONTENTS Vuclip 98 Youtube 99 Australia 99 Presto 99 Quickflix 100 Stan 100 China 100 iqiyi 100 QQ Live 101 Youku Tudou 101 Hong Kong 102 Anyplex 102 GOTV 102 HKTV 102 MyTV 103 Now Player 103 India 103 Myplex 103 ZengaTV 103 Indonesia 104 Genflix 104 USeeTV 104 Vidio.com 104 Japan 105 Dvideo 105 Hulu Japan 105 Uula 105 Korea 106 BTV 106 Olleh TV Mobile 106 Pooq 106 Tving 107 Malaysia 107 Tonton 107 New Zealand 107 Lightbox 107 Neon 108 Philippines 108 IWanTV.com 108 ClickPlay 108 Blink 109 Singapore 109 Toggle 109 Thailand 110 Hollywood HDTV 110 V
ABOUT US Media Partners Asia Research & Consulting (MPA R&C) is owned and operated by Media Partners Asia (MPA). MPA was founded by its two directors Vivek Couto and Rupert Wilkinson in Hong Kong in March 2001. Both directors have over 20 years of relevant experience, leading a team committed to the analysis of the media and telecoms industries in Asia Pacific. MPA s core platforms encompass research, consulting, conferences, publishing and digital. The company s clients are local, regional and global with representation across the ecosystem including media & telecom owners and distributors, policy makers, technology and finance. MPA R&C is an independent provider of advisory, consulting and research services, focusing on media & telecoms industries in Asia Pacific. Company analysts and consultants are based in Hong Kong, Singapore and India. Research reports include Asia Pacific Pay-TV & Broadband Markets; Asia Pacific Advertising Trends; Asia Pacific Online Video Distribution 2015; The Route; and Media Route 26 India. MPA R&C also provides dedicated and customized consulting to a wide range of players across the media & telecoms ecosystem including content owners, broadcasters, media distributors, telecom platforms, technology suppliers, policymakers, strategic & financial investors, legal institutions and more. A summary of key consulting services includes: Benchmarking companies, competitors and industry segments Commercial & technical due diligence services for M&A transactions Customized market research & data trackers Corporate strategy Consumer research Fair market appraisals & independent valuations Independent media consultant (IMC) research for initial public offerings (IPOs) and all equity & debt transactions Expert witness testimony For a list of clients, capabilities, geographical coverage areas and project track record, please contact Lavina Bhojwani (lavina@media-partners-asia.com). PUBLISHED BY Executive Director Vice Presidents Analysts Vivek Couto Aravind Venugopal Stephen Laslocky Mihir Shah Adrian Tong Jambi Reyes Milan Ashar Anurag Gaur www.media-partners-asia.com www.mparesearchconsulting.com Business Development Reagan Chan Client Services Manager Lavina Bhojwani Business Support Myrna Dignadice Atikah Shaftee Archana Dhamane Creative Director Frances Chan Company Directors Vivek Couto Rupert Wilkinson HONG KONG Suite 13A, 50 Stanley Street, Central. Tel: +852 2815 8710 SINGAPORE 8 Cross Street, #28-38, Singapore 048424. Tel: +65 6850 7623 INDIA The Hub, One Indiabulls Centre, Tower 2A, 10/F, Senapati Bapat Marg. Elphinstone Road, Mumbai-400013. Tel: +91 22 6189 9806 Permission to cite information contained in this report in any form of public documentation must be obtained from Media Partners Asia, Ltd. To request permission, please contact: lavina@media-partners-asia.com Queries about forecasts and data will be handled by MPA analysts - please contact: vivek@media-partners-asia.com 2015 Media Partners Asia, Ltd. All rights reserved. VI