APAC set for continued online video revenue growth

Revenues from the online video industry in APAC are set to grow to US$73 billion by 2027.

According to a new report from Media Partners Asia (MPA), total Asia Pacific online video industry revenue will grow by 16% year-on-year in 2022 to reach US$49.2 billion. Half of that total will be made up by SVOD, with UGC AVOD contributing 37% and Premium AVOD, 13%. That ratio will remain stable in the coming years as the industry continues to grow.

The picture is slightly different outside of China, the report notes. Excluding China, the APAC online video industry will grow 24% in 2022 to reach US$25.6 billion in revenue with SVOD contributing 47%; UGC AVOD, 43%; and Premium AVOD, 10%. Revenues are forecast to grow at a CAGR of 11% to US$42.8 billion by 2027, with SVOD’s share marginally shrinking in favour of Premium AVOD. 

China will generate US$11.2 billion in revenue in 2022 alone, making up 48% of the total APAC online video revenue market. Major streamers Tencent Video and iQIYI along with short-form video players ByteDance and Kuaishou will capture 70% of the Chinese market, with overall revenues set to grow at a CAGR of 5% over the next five years to exceed US$30 billion in 2027.

MPA executive director Vivek Couto said: “Investors are increasingly focused on enhanced scale, improved monetisation and real profitability across global, local and regional online video platforms. In this context, the role of Asia Pacific continues to have a critical role in the future of the global online video industry. 

Other markets that are more open to western businesses – such as India, Japan and Korea – will all continue to experience billions in growth as players like Disney and Netflix reach maturity in their traditional markets in North America and Western Europe. 

One surprising finding from the report is that Australia, while still being a high revenue generating market, has exceeded the US for SVOD penetration. Some 85% of homes in the country now subscribe to at least one streamer.

“The region remains the largest growth contributor to global online video customers and users today and is emerging as a significant contributor to revenue growth. With the US and Europe fast maturing and China inaccessible, APAC’s large markets – India, Indonesia, Japan, Korea and Thailand – will be increasingly important to global platforms. Each of these markets require local content and distribution strategies with long-term investment,” Couto said.