Asia pay-TV plateaus but death-knell not yet arrived
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Editor
| 11 October 2022
Returning to Indonesia for its annual event, the Asia Video Industry Association (AVIA), the trade association for the video industry and satellite ecosystem in Asia Pacific, has revealed a market whereby premium over-the-top (OTT) is putting traditional services under increased pressure.
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After opening comments for the event were made by Yuliandre Darwis, commissioner with the Indonesian Broadcasting Commission (KPI) who talked about the development of the KPI over the last twenty years, and the hope for revisions to the broadcasting law which could see greater responsibilities given to them, results from AVIA’s Indonesia in View Report were presented.

Bettina Cavenagh, president director, Clarity Research Indonesia, outlined the state of Indonesia’s video markets in the post-pandemic economy. Pay-TV, she said, had plateaued and while DTH services were the biggest victims of increased broadband penetration, cable numbers were increasing meaning the overall pay-TV market remained significant, even if ARPU’s were under pressure. But all eyes were now on the premium OTT market. Subscription video-on-demand (SVOD) was found to have grown by more than 50% from 2020 to 2021, to 11.5 million subscribers, while digital advertising grew by 33% over the same period.

This said AVIA set the scene for much debate throughout the conference on the relative merits of the subscription versus the advertising led business model for OTT.

Sutanto Hartono, managing director of EMTEK and CEO of SCM and Vidio, discussed Vidio’s emphasis on local originals and live sports as differentiators in their quest to acquire customers and keep churn down. While sports rights were expensive and not owned in perpetuity, they played a crucial role in a growth strategy. Marlo Budiman, CEO & president director, Link Net, later added that while the pay-TV market had plateaued, its death knell had not quite sounded yet and also attributed this to the role of sports and original content keeping OTT churn low.

In a conversation around growth and monetisation, Vidio COO Hermawan Sutanto talked of the need to educate the market to pay for premium OTT services while Guntur Siboro, country head for Lionsgate Play further made the point that ad-supported VOD (AVOD) was a different ballgame which required significant investment to monetise successfully. Whatever the business model, Avijit Duta, deputy country manager for content provider Viu, emphasised the need for the business to be sustainable and everyone was witnessing rising production costs as the production talent pool was still limited.