The online video market in Asia is set to grow nearly threefold over the next five years, reaching more than $46 billion by 2022, according to a new report. China will account for more than half of the total.

The report by consultancy Media Partners Asia, titled “Asia Online Video & Broadband Distribution,” says that revenues, comprising net advertising and subscription fees, will grow at a 21% compound annual rate across the region between 2017 and 2022, climbing from $17.6 billion in 2017.

Significantly, different business models are likely to persist side by side. Local operators are expected to survive despite competition from global video streaming giants, and local content will be crucial.

The scale of the Chinese online video market, and, in particular, its subscription segment, defies current market conventions.

The MPA study forecasts that advertising on Chinese video platforms will hit $13 billion by 2022, even as advertising revenues shrink as a proportion of the overall Chinese business. The value of subscriptions in China is projected to reach $17.3 billion by the same date. Together they represent a $30-billion online market. That dwarfs the $6.4 billion recorded by China’s theatrical movie sector in 2016.

The report says that China’s success in the sector reflects wide-scale investment in original and acquired OTT content, including content with early and exclusive windows; a weak market for traditional pay-TV; infrastructure improvements and adoption of smart TVs and set-top boxes; and consumer use of seamless payment systems, some developed by the Internet leaders that are also owners of the most popular online video services.

“Services anchored to nimble, robust and sustainable business models – built around strong execution and scalable content consumption – are rising to the top” across Asia, said the report’s author, MPA executive director Vivek Couto. “Access to local and Asian content is increasingly essential in almost all markets, while demand for recent windows for franchise-based Hollywood product is also robust.

“Content curation, packaging and pricing remain critical, along with brand equity. Leading local and regional players ex-China will start to capitalize on a massive online video advertising opportunity, hitherto dominated in the main by YouTube.”

Outside China, the landscape is more varied, with Japan and Australia the most developed, and other key territories, including India and Korea, still currently very fluid. Those two developed markets are also where Netflix is strongest in the region. MPA estimates that Netflix is on course to have 4.7 million subscribers within the Asia Pacific region by the end of 2017, with Australia accounting for perhaps 3 million of those.

In smaller territories, notably the Philippines, Thailand, Malaysia, Korea and India, the uptake of premium video goes hand in hand with the levels of cooperation between OTT operators and local telecoms and broadband providers. The telcos provide bandwidth and pre-paid solutions. Piracy remains an ongoing problem for the industries in Singapore and Malaysia.

Multinational Asian OTT video operators, including Hooq and Iflix, are competing with Netflix and Amazon, not just through telco connections, but also through programming strategies and content production investment. Some consolidation of the groups, however, seems a possibility, the report says.

Surprisingly, perhaps, given the rapid expansion of the OTT sector, pay-TV’s branded content players are unlikely to be killed off completely, the report predicts. Channels and branded destinations have ongoing strength in movies and sports, in particular. Couto points to signs of success for the new digital offerings of Fox Plus, Disney and Cartoon Network in the Philippines, and HBO in Hong Kong.