APOS: Global Media Execs Descend on Bali to Discuss Trends Shaping Asian Entertainment Markets

As a seasoned media and tech enthusiast with over two decades of industry experience under my belt, I must say that attending APOS in Bali is always an enlightening experience. The event brings together some of the biggest players in the global entertainment landscape, providing a unique opportunity to learn about the trends shaping Asia’s diverse and enormous entertainment landscape.

On a balmy Wednesday, Bali was filled with professional garb as global media and tech leaders arrived at this tropical paradise for the start of APOS, an annual gathering focusing on the media, telecoms, and entertainment sectors. Given the challenges facing the film and television industry in the established markets of Europe and North America, executives convened in Indonesia to exchange ideas and explore the trends influencing Asia’s vibrant and vast entertainment scene.

Originating as a gathering focused on cable and satellite TV in 2010, APOS has since transformed into an essential event on the autumn calendar for industry heavyweights like Netflix, Disney, Amazon, YouTube, Meta, TikTok, Reliance Jio (India), U-Next (Japan), CJ ENM (Korea), and SCMA (Indonesia). The organizers, Media Partners Asia (MPA), deserve credit for this growth due to the burgeoning popularity of online video and a strategic location decision – the luxurious Anaya Resort Bali, overlooking the Indian Ocean.

James Gibbons, President of APAC at Warner Bros. Discovery, created headlines early on by revealing Max’s anticipated release dates in significant markets such as Australia, Hong Kong, Taiwan, and Southeast Asia. However, prior to the main event, following APOS tradition, Vivek Couto, managing partner of MPA, kick-started the two-day conference with an opening speech that highlighted crucial topics shaping the region’s ongoing development.

In essence, Couto spoke of a story involving two distinct market segments. On one hand, we have mature markets in North Asia and the Pacific such as Japan, South Korea, Taiwan, Australia, and New Zealand, where global video platforms are adopting strategies similar to those used in the West. They’re maximizing their existing subscriber bases by raising prices and introducing ad tiers, aiming for higher returns and broader reach. On the other hand, there are developing markets like India, Vietnam, and Indonesia in the region, where per capita income is low but the population is young and growing potential is high. In these markets, video platforms are primarily focusing on expanding their premium video market by offering new subscriptions to increase their total potential customer base.

Couto pointed out that local content remains king throughout Asia, with Korean drama and reality, Japanese anime, and, increasingly, Chinese drama, driving engagement across many of the region’s key markets. In India, meanwhile, sports rights, particularly JioCinema’s live Indian Premier League cricket coverage, but also the Olympics and the English Premier League, play an outsized role. Asia’s many local video platforms thus enjoy significant market share thanks to their robust content pipelines and local market fit.

However, Couto pointed out that global players have a significant advantage in monetization. As per MPA’s predictions, the top four U.S. online video platforms (Amazon, Meta, Netflix, and YouTube) are expected to generate approximately $21.6 billion in revenue from videos in the Asia Pacific region this year. This is more than twice the $9.6 billion earned by the leading eight regional platforms (Disney/Viacom18, CJ ENM, U-Next, PCCW, Foxtel, NC, Asto, and Indonesia’s SCMA). On a global scale, the financial disadvantage faced by local operators is more severe, suggesting long-term difficulties: The consolidated EBITDA (earnings before interest, taxes, depreciation, and amortization) of the top four global companies exceeds $204 billion, while that of the regional eight is only slightly over $1.2 billion.

To clarify further, Couto stated his belief that prominent streaming services aim to transition users towards yearly subscription packages. This ambition, among other reasons, contributes to the rise in prices for top-tier monthly subscriptions and the increase in advertisements on ad-inclusive plans.

Platforms are adopting unique business strategies tailored to their key market partners. For instance, Netflix initially concentrated heavily on a direct-to-consumer approach but is now shifting towards relying more on partnerships for its growth phase. On the other hand, Disney is moving in the opposite direction, intensifying its focus on a Direct-to-Consumer product.

Warner, along with MAX, aims to achieve equilibrium across various market segments,” Couto mentioned, highlighting their current expansion into Japan through a partnership with local streaming service U-Next.

The Marketing Prognostication Association (MPA) predicts a decline in television’s dominance within the Asian advertising market during the next five years. From 2020 to 2024, the APAC video sector is projected to generate an additional 15 billion dollars in ad revenue, with $12.5 billion attributed to user-generated content on social media platforms and only a million dollars from premium AVOD services and another billion dollars from traditional TV.

For the upcoming five years, it’s anticipated that our sector will bring in an additional 9.6 billion dollars from advertising. Couto further mentioned that television revenue may decrease by 5 billion dollars, while user-generated content on social media is expected to increase by 10.7 billion dollars and premium Advertising Video On Demand (AVOD) will contribute an extra 4 billion dollars.

APOS continues through to Sept. 26.

2024-09-25 13:24

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