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Growing investment in local content spurred by streaming companies is threatened by rampant piracy

With AVIA's "Indonesia In View" there is broad optimism for the future of Online Curated Content VOD services in Indonesia, with existing Pay TV services being increasingly challenged, but both threatened by piracy.

JAKARTA, Mar 20, 2019 - (ACN Newswire) - The Asia Video Industry Association (AVIA) yesterday held a one-day conference, Indonesia in View, to assess the health and prospects of the video industry in South East Asia's largest country. The "In View" events are designed to bring together government officials, key in-country business heads, and international and local experts to discuss crucial issues relevant to the industry.

The conference was opened jointly by Ibu Rosarita Niken Widiastuti, the Secretary General of the Ministry of Communication and Information Technology and Dr. Yuliandre Darwis, the Chairman of KPI. Presaging one of the key themes of the day, Dr Yuliandre said the government hoped to see and support increasing investment in local content. Alphabeta Engagement Manager Konstantinos Matthies observed that his firm's surveys indicate that Online Curated Content (OCC) providers would multiply their investment in Asian content 3.7 times, in the next three years. Fauzan Zidni the Chairman of APROFI (the Indonesian Association of Film Producers) also acknowledged the opportunity for the local production industry to grow and move up the value chain with the increased focus on local productions. Joddy Hernandy, SVP Media and Digital Business and EGM Digital Services Division of Telekom emphasised the importance of the user experience for both paid and ad supported services.

In a lively discussion between the major OCC video streaming companies - Hooq, iflix, OONA, Viu and Telkomsel, Jason Monteiro, CMO of iflix, said they would double their investment in local content this year, as they had seen favourable audience reactions to Asian stories. All parties agreed that unique, original content was this biggest draw to attract subscribers while Dr. Guntur S. Siboro, Country Head of Hooq pointed out that real competition was for app space on the smartphone and there was really only a desire for one content app from Indonesian consumers. Crispin Tristram, VP of digital lifestyle service of Telkomsel talked about the growing success of their super app that aggregates content but also pointed out the challenges of monetisation - in gaming they are seeing a 10% conversion rate from free services to paid, for music it is 3% but for video it is less than 1%.

This low conversion rate was almost certainly largely because of the high levels of piracy in Indonesia. Over discussions throughout the day it became clear there was still a large traditional DTH piracy market with local cable operators illegally retransmitting DTH signals to their own subscribers; but there was also a massively growing digital streaming piracy ecosystem and until that is addressed, free to paid conversion rates for video services will remain low.

The final session of the day focussed further on the problems of piracy, especially as it related to football and Louis Boswell, CEO of AVIA highlighted the focus the association now has on piracy and the active engagement it is currently pursuing with local industry and government in Indonesia.

A new survey, commissioned by AVIA's Coalition Against Piracy (CAP), and conducted by YouGov highlights the detrimental effects of streaming piracy on legitimate subscription video services. The YouGov survey found that 29% of online Indonesian consumers use an TV box to stream pirated television and video content. Of the 29% of consumers who purchased an illicit streaming device (ISD) for free streaming, two in three (66%) stated that they cancelled all or some of their subscription to legal pay TV services. Specifically, 33% asserted that they cancelled their subscriptions to an Indonesian-based online video service as a direct consequence of owning an ISD. International subscription services, which include pan-Asia online offerings, were also impacted - more than one in three (31%) Indonesian users abandoned subscriptions in favour of ISD purchases.

Indonesia in View was supported by Presenting Sponsor TV5Monde, alongside sponsorship from Hansen Technologies and NHK World Japan.

About the Asia Video Industry Association

The Asia Video Industry Association (AVIA) is the trade association for the video industry and ecosystem in Asia Pacific. It serves to make the video industry stronger and healthier through promoting the common interests of its members. AVIA is the interlocutor for the industry with governments across the region, leads the fight against video piracy and provides insight into the video industry through reports and conferences aimed to support a vibrant video industry. AVIA evolved from Casbaa in 2018.

Media Contact:
Nirav Haji
Head of Marketing and Communications
Tel: +65 9188 54944 / +852 5741 6559

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