APAC poised to see huge OTT growth, but piracy is a menace

The over-the-top video industry in the Asia-Pacific region could see revenues more than double by 2020, according to a regional trade group that points out that mobile broadband also is on track to more than double to some 2 billion subs by the end of the decade.

“The Asia Pacific region is still primarily driven by the traditional linear TV market but… there is tremendous business potential in tapping into OTT,” said Christopher Slaughter, CEO, CASBAA, the association for digital multichannel TV, content, platforms, advertising and video delivery throughout APAC.

Board member and MD of APAC for Universal Networks International Christine Fellowes, meanwhile, pointed out that while fixed broadband was at just 35% penetration, there were more than 866 million mobile phones in the region using 3G or 4G networks, a number she said should near 2 billion by 2020.

“While linear television will remain the driving force for some time, OTT is currently a US$3 billion industry in Asia Pacific and forecast to be $8 billion by 2020,” she said.

And, SNL Kagan Analyst Wangxing Zhao said the researcher sees OTT as more of an opportunity than a threat for operators in APAC.

“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 said. “Netflix has proven that OTT is more about getting new subscribers for the TV industry, rather than cannibalizing existing ones.”

But there are significant obstacles that still need to be overcome.

“We have a huge problem when it comes to OTT monetization, where piracy is fast becoming the de facto viewing habit of a full generation of users,” said Matt Pollins, a media lawyer. “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.”

Stay tuned.

Jim O’Neill is Editor of Videomind and Principal Analyst at Brightcove. You can follow him on Twitter @JimONeillMedia and on LinkedIn