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The pay-TV sector in Asia is set to track sideways over the next five years, with net new subscriber numbers negligible, a drift of sports to online platforms and a forecast of consolidation, according to a new study.

The Asia Pacific Pay-TV Distribution 2022 report from Singapore-based consultancy Media Partners Asia, suggests that cord cutting peaked between 2019 and 2021 with an aggregate 9.1 million homes cancelling subscriptions, especially in Australia, Malaysia and Thailand. The report predicts growth of just 1 million (ex-China) between in 2022-27, driven by India and parts of South and Southeast Asia but partially offset by contraction in all other regions.

“Pay-TV’s future sustainability is anchored to bundled IPTV and home broadband services with telcos and pay-TV operators also integrating premium online SVOD services through the launch of Android platforms, hybrid set top boxes and various new packages. Linear TV remains important with local and Asian content, sports, and niche international channels driving viewership,” say the report. “However, the growth of legal and affordable online SVOD options as well as the pervasiveness of piracy means that the value of premium sports and entertainment is migrating rapidly away from pay-TV to online. Operator consolidation grew between 2019 and 2021 and we expect more to occur in markets such as China, India, Indonesia, Japan, Korea, Malaysia and Taiwan.”

China is a different story. “China remains the largest pay-TV market in Asia Pacific but remains inaccessible to international investors and content providers. The high volume, low-ARPU pay-TV market continues to grow with total pay-TV subscribers reaching 578 million in 2022, 90% penetration of TV households, after adjusting for multiple subscriptions. [Within that market] after overtaking cable TV as the largest pay-TV segment in 2019, IPTV continues to gain share of subs and revenue, benefitting from popular telco fibre broadband bundles and superior content offerings (especially premium on-demand) over cable TV. Media Partners Asia projects 41 million new IPTV subscriptions in China between 2022 and 2027, taking the total base up to 419 mil. by 2027, with 76% of the total fixed broadband base subscribing to IPTV.”

In revenue terms, MPA’s analysis is similar. Total Asia Pacific pay-TV industry revenues, including subscription and advertising, will grow by an estimated 3.5% in 2022 and is projected to grow at 2.1% compound average growth rate over the next five years. Ex-China, the Asia Pacific pay-TV revenue pie is
estimated to grow 1.4% in 2022 and at a CAGR of 1.7% between 2022 and 2027. Revenue growth in 2022 has largely been driven by India, Korea, the Philippines and Vietnam. India and Korea will continue to contribute the most to incremental revenue growth between 2022-27,” the report says.

India, Korea and Japan will remain the largest revenue generating markets in Asia Pacific ex-China, accounting for a combined 74% share in 2022, growing to 78% by 2027.

“Total Asia Pacific IPTV subscription fees will grow from US$20.5 bil. in 2022 to US$24.7 bil. by 2027, a CAGR of 4%, driven largely by China and Korea as well as incremental growth in Southeast Asia.” The report concludes.