Asia Pacific embraces IPTV as Netflix storms in

The Asia Pacific IPTV market is set to become the second biggest in the world by 2018 fuelled by government supported infrastructure development including fibre roll-outs and consumer demand

According to forecasts from Transparency Market Research, the Asia Pacific excluding Japan is set to register 21.1 per cent CAGR from 2014 to 2020. Indonesia, India, South Korea, and China are likely to be the key drivers of growth during this period.  China in particular, armed with an ever-growing middle class income group and expanding broadband infrastructure, is projected to witness a significant boom in IPTV subscribers over the next five years.

The aggressive push of Netflix into 18 Asia markets will also influence growth across the sector. Announcing the Netflix roll-out in 130 countries at CES 2016, CEO Reed Hastings said the company is building relationships in China, where he hopes to launch this year or in 2017.  Netflix has added simplified and traditional Chinese to the 17 languages it already supports. 

According to consultancy Media Partners Asia the Netflix invasion will be a tipping point for IPTV services in the region.

Vivek Couto, executive director of Media Partners Asia forecast, “over the next 3-5 years in markets that have scale, such as Japan, India, Korea and China, there is no doubt they will invest in local co-productions and getting strong telco partnerships.

I don’t think they will replicate their success in the U.S.  but it’s a long-term horizon.”

He adds that as the scale of competition in Asia heats up  we will see a lot more players entering the SVOD market and you might see players in China expanding across South East Asia.

The Chinese OTT market was valued at $5 billion in 2015, 85% of that from advertising, the balance from subscriptions.

Leading platforms include  Tencent Holdings,  e-commerce giant Alibaba  Group Holding, which recently partnered with  the Walt Disney Co and Baidu’s  Qiyi.

According to Asia Pacific based distributed video delivery provider, Edgeware, the anticipated growth in the region will also lead to the rise of ‘smart OTT’ solutions to cope with competitive pressures. 

“The need to reach consumers' multiscreen demand with a direct-to-consumer offering is inevitable. With increasing competition, 2016 will solidify a new normal in which OTT providers compete on being smarter – both in acquiring or producing high concept originals, and in delivering relevant content to the consumer the way they prefer without compromising quality,” advises Edgeware director Peter Lofling.