Global streamers seek price increases as Asia market grows, matures

Multinational streaming groups are using their increasing market strength to raise pricing and profitability in the Asia-Pacific region. The region’s many local competitors enjoy significant revenue share, but mostly lag the global giants in terms of earnings.

That was one of the starkest messages to emerge from an opening address by Vivek Couto, managing partner at consultancy firm Media Partners Asia, on Wednesday, the first morning of his APOS conference in Indonesia.

Global streamers are putting the screw on monetization, he said. “Netflix started as a direct-to-consumer business model (D2C) but is now leaning more on partners for the next phase of its growth. Disney is going in the opposite direction, with an increasing focus on D2C product. Warner, with MAX, will try find a balance in different markets, such as with its recent deal with U-Next in Japan,” said Couto. Max, the streaming platform combining content offering from Warner, HBO and Discovery, is beginning to roll out in Asia from Wednesday.

“Price increases are becoming more prevalent. At the same time there is more advertising on both SVOD and user-generated platforms (for example Netflix with ads, Prime Video, Tving, and YouTube increasing its advertising load, stopping ad blockers and raising YouTube Premium prices). This comes from the platforms’ desire to move for annual plans,” he said

Disney is at stage two of its model, phasing out discounted partner pricing and pricing its offering closer to that of Netflix, Couto explained. “As markets evolve, the offerings evolve with it.”

In a slide, Couto showed that the big four entertainment-tech companies, Amazon, Meta, Netflix and YouTube will earn an estimated $21.6 billion of video revenue in the Asia Pacific region this year. That is a little more than double the $9.6 billion video revenue aggregate earned by Disney/Viacom18, CJ ENM, U-Next, PCCW, Foxtel, NC, Asto and Indonesia’s SCMA.

But in terms of their global profits (and therefore ability to outgun locals) the big four earn a staggering $240 billion, compared with $1.5 billion for the same group of local market leaders. That makes them more than 150 times more powerful.

In another segment, Couto said that tech has “resized” the entertainment landscape. According to that analysis, Amazon is now the world’s leading entertainment company with overall annual revenues for 2024 estimated at $583 billion, ahead of YouTube owner Google on an estimated $333 billion. Meta, owner of Facebook, Whatsapp and Instagram, places third with a forecast $150 billion of revenues.

Meta, however, is not that far ahead of China’s Bytedance (owner of TikTok and Douyin). And Bytedance has bigger revenues than the entertainment industry’s traditional behemoth Disney, on $92 billion and China’s Tencent on $91 billion. Netflix is expected to have $39 billion of revenues in the current year.