APAC OTT has huge potential
March 5, 2015
Christopher Slaughter, CEO, CASBAA told its OTT summit: “The Asia Pacific region is still primarily driven by the traditional linear TV market but, as our speakers have detailed today, there is tremendous business potential in tapping into OTT.”
Christine Fellowes, Board Member Responsible, CASBAA OTT & Connected Media Group, and MD Asia Pacific, Universal Networks International, offered her thoughts on the outlook for OTT, stating: “Currently fixed broadband in Asia Pacific is at 35 per cent household penetration. Mobile broadband subs powered by 3 and 4G networks are at 866 million today and will expand to reach almost two billion subs in just five years. While linear television will remain the driving force for some time, OTT is currently a $3 billion industry in Asia Pacific and forecast to be $8 billion by 2020.”
Further reinforcing the potential that OTT services hold for the region, Wangxing Zhao, Associate Research Analyst, SNL Kagan said that “We see OTT as much more of an opportunity than a threat for all players in the TV industry. OTT is being leveraged by free broadcasters, pay-TV providers and pay-TV platforms too but discrepancies between markets in the Asia-Pacific region are phenomenal and, as a result, OTT in some markets will have a much longer trajectory than in more developed markets.”
Zhao added: “Netflix has proven that OTT is more about getting new subscribers for the TV industry, rather than cannibalizing existing ones.”
But, despite the rosy picture, other speakers pointed out hurdles that could hinder the progress of OTT in the region.
“We have a huge problem when it comes to OTT monetidation, where piracy is fast becoming the de facto viewing habit of a full generation of users,” said Matt Pollins, Media Lawyer, Olswang Asia. “Evidence confirms that the main reason people pirate is because it is free and I don’t think the industry alone can remedy this simply by putting more content options out there, without substantial help from the authorities in more actively enforcing copyright.”
“In many Asian markets there are services flagrantly infringing copyright in broad daylight without any real risk of enforcement,” Pollins warned.
Net neutrality, an issue topical in the US presently, was also highlighted as a possible issue for the Asia Pacific in the future.
Said James Miner, CEO, Miner Labs: “Nobody has mentioned the words ‘net neutrality’, but we have to be concerned about who is going to finance the networks needed to provide bandwidth needed for online video….Netflix and YouTube are the poster children for overconsumption.”
However, what was clear was that old business models would not be sufficient in the digital age.
“Change is the thing that will define this industry, and those who can manage that best will succeed,” said David Habben, Chief Media Strategist, Akamai Technologies.