BY ELLIOT RENTON
Earlier in November, Netflix rolled out a mobile-only subscription offer in Malaysia, lowering user cost and broadening its appeal to different audiences across the country. This move reflects the migrational shift towards satisfying the demands of consumers who are looking to access media services on a variety of platforms at low cost, and slowing subscriber growth for Netflix in Asia.
While cost is a large factor in many territories across the region, offering a mobile-only option to consumers presents a scalable option for rapid growth in the over-the-top (OTT) sector, and with 4G expanding across emerging markets and 5G roll-out on the horizon, this change in pricing strategy for Netflix will be a smart move.
Across Asia-Pacific, there are over 1.1 billion digital video viewers with 90% smartphone penetration. Smartphone ownership will overtake TV ownership very quickly, as it already has in Singapore. The speed in changing consumption habits means no platform is immune to challenges in audience retention and building sustainable revenue growth.
For Netflix, testing the water with a reduced subscription offering and investing heavily on local productions and original content will help shape their growth aspirations against a backdrop of intense competition from other local and regional platforms. The anticipated launch of Disney Plus in Asia next year across similar territories will also offer consumers more compelling choice, and likely lavish audiences with attractive pricing options depending on content titles and features.
Asia-Pacific is fertile ground where audiences are habitually using mobile devices to browse video on the go, on top of extensive use in the home on local Wi-Fi networks. Many new and traditional media providers are capitalising on this behaviour by offering premium video content for free on social platforms, mobile apps and websites, driving consumers back to higher value OTT and paid subscription services.
All of this means the opportunities to provide accessible mobile video services have never been as valuable, and will only continue to grow. Using the reach of social and mobile video to drive viewers to services on the same device proves highly effective, and aligns with the applications of a mobile device — convenient and flexible use. As the market grows, these differentiators will offer a competitive edge.
We may see a doubling-down on social video efforts from competitors if Netflix mobile-only subscription becomes successful. Social video content achieves high levels of engagement, especially when the content is being streamed live or when live streams become interactive to include social pools, audience comments, and graphic overlays. This creativity in mobile video as a marketing and promotional tool significantly drives up tune-in times thanks to the appeal of communal watching and participation. As mobile networks develop and connectivity increases, we can expect live social video to dominate screen time.
Whether it is through social media, mobile applications or OTT apps, content options for consumers to choose from will expand, and media organisations will continue to have to innovate and strengthen their platform strategies to deliver high-quality video content and services to consumers, exactly how and when they demand it.
As we approach 2019, this disruption in consumption and the increased battle for audiences will exert even more pressure on new and existing platforms. However, one thing is for certain — there has never been a more exciting time to be in the media content industry.
Elliot Renton is senior director and head of Asia-Pacific at Grabyo.