Netflix, Tencent jostle for streaming market share in Southeast Asia

Photo by Caspar Camille Rubin on Unsplash

Video streaming is king in smartphone-savvy Southeast Asia, and global heavyweights like Tencent Holdings and Netflix are battling along with regional tech companies over a burgeoning market set to expand into the tens of billions of dollars per year.

Tencent on Friday launched the WeTV platform in Thailand, its first overseas streaming market. The Chinese technology giant aims to break into Thailand’s top three services by the end of 2019 with such offerings as Chinese movies and dramas, which have gained a following in Thailand.

“We’re planning to further expand video streaming outside China,” said Li Kaichen, head of Tencent’s overseas streaming operations, to Nikkei. “We intend to focus on Southeast Asia, where potential demand is especially high.”

Video streaming has become a leading leisure activity in Southeast Asia, where old analog, cathode-ray-tube televisions still predominate in some areas and conventional television networks, often state-run, offer little in the way of entertainment. Mobile streaming provides access to better content with higher video quality.

Netflix has established itself at the top of the Southeast Asian market with a 31% share, thanks partly to locally made content with broad appeal. The American company plans to add another 100 original programs across eight Southeast Asian countries this year, including Thailand, the Philippines and Malaysia.

In April, Netflix secured exclusive rights to make a miniseries based on last year’s rescue of a Thai youth soccer team from a flooded cave, a drama followed around the world. “We are looking forward to bringing this inspiring local, but globally resonant, story” to life, said Erika North, director of international original programming.

Amazon.com rolled out stand-alone Prime Video across Southeast Asia and many other markets in 2016 and began offering it for free to Amazon Prime subscribers in Singapore a year later.

A graduate student in Bangkok uses three streaming services — including Netflix and Hong Kong-based Viu — to watch dramas from Europe, the U.S. and South Korea. “I end up watching for as much as four or five hours a day,” said the 30-year-old. “I hardly ever watch television because the picture quality is so bad.”

Economic growth and changing lifestyle habits are powering a rapid expansion of streaming in the region. A report by Google and Singaporean sovereign wealth fund Temasek Holdings estimates that Southeast Asia’s online media market, including gaming and advertising, topped $11 billion in 2018 and will triple to $33 billion in 2025.

Regional players also seek a slice of this pie. Malaysia-based Iflix, dubbed the Netflix of Asia, holds a 22% share of the Southeast Asian market, putting it behind only Netflix. Low prices and local content for each of its markets have helped Iflix gain more than 10 million subscribers.

Indonesian e-commerce company Bukalapak also has a streaming platform, offering such content as live soccer matches and children’s cartoons.

Singaporean ride-hailing operator Grab jumped into the streaming market late last month with a partnership with Singapore Telecommunications unit Hooq under which users can watch Hooq content directly from the Grab app. Grab’s Indonesia-based rival, Go-Jek, announced plans last year for its own video service.

The growing ranks of companies in the streaming arena are vying for the eyeballs of some of the world’s most avid internet users.

Average daily internet usage clocks in at 10 hours in the Philippines and nine hours in Thailand, according to a report by U.K.-based We Are Social. Thais spend more than three and a half hours a day on average watching TV and streaming video, with Indonesia not far behind at three hours, compared with four and a quarter hours in the U.S.

And there remains plenty of room to grow. Data from Statista on subscription-based streaming services shows that the U.S. is by far the largest market by revenue at 46%, followed by China at 7% and Japan at 6%. The 10 members of the Association of Southeast Asian Nations together account for just over 2%.

Yet 6% of all users live in the region, more than in Japan, Germany or the U.K. With disposable incomes rising as the middle class expands, users of free or ad-supported services could be convinced to open their wallets if platforms can offer sufficiently attractive content.

This article was first published on Nikkei Asian Review.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.