Asia Pacific’s online video revenue will grow by 22% per annum to reach US$35 billion by 2021, with China accounting for 76% of this, according to Media Partners Asia (MPA).
Japan, Australia, Korea and India will also be significant contributors to the region’s online video market, accounting for a combined 17% of revenues by 2021, following a surge in broadband adoption.
Fixed broadband subscriptions in the region will reach 345 million in 2016, and grow to 425 million by 2021. Average broadband household penetration will grow from 35% in 2016 to 41% in 2021. Mobile broadband will reach 79% of the region’s population by 2021, compared to 46% this year, said the Hong Kong-based researchers.
“The growth of broadband, combined with slow but progressive change in content licensing, is driving demand for online video services. However, the distribution of driver local content online is modest, especially outside of China, India and Korea,” said Vivek Couto, executive director, MPA.
“This is evident in Southeast Asia, where broadband penetration is growing rapidly but from a low base in most markets. Telecom operators in these markets are investing in broadband networks and integrating with online video platforms to help drive subscriptions. This allows online video operators to utilize carrier billing, overcoming market limitations in payment infrastructure. It’s a bet to drive online video consumption in the short term and ARPUs in the long term.”
Online video advertising will account for 22% of Asia Pacific digital ad spend by 2021, up from 15% in 2015, while online video ad sales will register 19% CAGR to reach about $22 billion by 2021, up from $9 billion last year. China will take over 70% of the regional advertising market in the same period, forecasts MPA in its latest report, Asia Pacific Online Video Distribution 2016.
Subscription video-on-demand (SVOD) will almost double from 177 million customers in 2015 to 360 million customers by 2021 – with China again accounting for the lion’s share. Across the Asia Pacific SVOD revenue will witness a healthy 28% CAGR from $3.7 billion in 2016 to $13 billion by 2021.
“The Southeast Asia SVOD opportunity will grow rapidly but from a low base, representing about US$200 million in revenue by 2021,” said MPA.