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Streaming giants tighten their grip on Asia-Pacific markets
The evolving landscape of streaming services
In the dynamic world of streaming, multinational giants are leveraging their market dominance to increase prices and profitability in the Asia-Pacific region. While local competitors hold a significant share of revenue, they often lag behind global leaders in terms of earnings.
This trend was highlighted by Vivek Couto, managing partner at Media Partners Asia, during his opening address at the APOS conference in Indonesia. Couto’s insights shed light on the strategic maneuvers of major streaming platforms as they navigate the evolving market.
Shifting strategies of global streamers
Global streaming platforms are intensifying their focus on monetization. Netflix, which initially adopted a direct-to-consumer (D2C) model, is now increasingly partnering with other entities to fuel its next growth phase. In contrast, Disney is doubling down on its D2C approach, while Warner aims to strike a balance with its MAX platform, recently partnering with U-Next in Japan. MAX, which combines content from Warner, HBO, and Discovery, is set to expand its presence in Asia.
Couto emphasized the growing prevalence of price hikes and increased advertising on both subscription video on demand (SVOD) and user-generated platforms. For instance, Netflix has introduced ad-supported tiers, while Prime Video, Tving, and YouTube are ramping up their advertising efforts, blocking ad blockers, and raising YouTube Premium prices. These changes reflect the platforms’ push towards annual subscription plans.
The financial might of global players
A striking revelation from Couto’s presentation was the financial disparity between global and local streaming companies. The big four entertainment-tech giants—Amazon, Meta, Netflix, and YouTube—are projected to earn a combined $21.6 billion in video revenue in the Asia-Pacific region this year. This figure dwarfs the $9.6 billion aggregate revenue of local players like Disney/Viacom18, CJ ENM, U-Next, PCCW, Foxtel, NC, Asto, and Indonesia’s SCMA.
However, the gap in global profits is even more staggering. The big four are expected to generate a combined $240 billion in profits, compared to just $1.5 billion for the leading local market players. This immense financial power enables global giants to outpace their regional counterparts significantly.
The tech-driven transformation of entertainment
Couto also highlighted how technology has reshaped the entertainment landscape. Amazon is now the world’s leading entertainment company, with projected annual revenues of $583 billion for 2024. Google, the owner of YouTube, follows with an estimated $333 billion in revenues. Meta, which owns Facebook, WhatsApp, and Instagram, is expected to generate $150 billion in revenues.
Interestingly, Bytedance, the Chinese company behind TikTok and Douyin, is not far behind Meta and surpasses traditional entertainment behemoths like Disney and Tencent. Bytedance’s revenues are projected to reach $92 billion, while Tencent is expected to earn $91 billion. Netflix is forecasted to generate $39 billion in revenues this year.
The future of streaming in Asia-Pacific
As the streaming landscape continues to evolve, the strategies of global giants and local competitors will shape the future of entertainment in the Asia-Pacific region. The increasing focus on monetization, price adjustments, and advertising reflects the industry’s drive to maximize profitability and sustain growth.
The financial clout of global players positions them to dominate the market, but local competitors are not without their strengths. The unique content offerings and regional expertise of local platforms will play a crucial role in their ability to compete and thrive.
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