Jakarta, Indonesia – The Indonesian video industry is set to reach a value of US$2.5b this year and ballooning up to US$3.7b in 2028, a new report from Media Partners Asia has stated.
According to the report, TV’s share, including net advertising and subscription, dropped to 48% from 56% in 2023, as the shift to online video accelerates, led by UGC and social video as well as including premium video-on-demand (VOD), including freemium and SVOD platforms.
Surya Citra Media (SCMA) and MNC will remain market leaders in terms of monetisation with SCMA a clear beneficiary from the shift to digital terrestrial television (DTT).
Meanwhile, linear-based pay-TV adoption will continue to decline, as pay-TV’s incremental growth remains anchored to bundles of home broadband and payTV offered by players such as Telkom Indonesia and Axiata-owned LinkNet.
In terms of online share of the video industry, the report notes that revenue will grow from 44% in 2023 to 52% by 2028. UGC and social video, driven by YouTube and TikTok, lead monetisation, with UGC expected to grow advertising at 12% over the next 5 years for a 26% share of total video industry revenues by 2028. Meanwhile, SVOD is expected to grow at 11% over the 2023-28 period in order to grow market share in total video from 16% to 19%. Premium AVOD, meanwhile, is forecasted to grow at 16% from a low base with total video industry market share rising from 5% to 7% over the 2023-28 period.
Lastly, the report notes that Indonesian content investment grew 13% in 2022 to US$979m, representing Southeast Asia’s largest video content market. FTA remains the largest video content investment vertical. Meanwhile, online video content (local entertainment and sports) investment is the fastest growing as Netflix, Amazon and SCMA’s Vidio continue to invest through 2023. The report projects video industry content investment to grow 6% to just over US$1b in 2023 with online video rationalizing a notch.
Vivek Couto, executive director at Media Partners Asia, said, “The advertising economy endured a poor 1H 2023; this will be partially offset by a stronger 2H 2023. TV is in the doldrums with annual ad declines over 2022 and 2023. TV ratings continue their gradual decline as audiences drift online. Free TV remains critical for mass ad campaigns, but growth is capped, held up largely by local consumer brands. Meanwhile, Indonesia remains Southeast Asia’s most intense battleground for streamers.”
He further added, “By consumption and value, it is the largest market in SEA. Improvements in the quality of local content, combined with the proven viability of Korea content and localized tier-1 US content, has helped drive user acquisition and engagement. More rational pricing and packaging is helping to slowly boost per subscriber economics. The challenge remains the growth of free VOD platforms YouTube and TikTok. Both dominate viewership on mobile while YouTube is also increasingly popular on CTV. YouTube also remains the VOD category leader in terms of revenues by some distance though TikTok is growing rapidly while Netflix leads SVOD.”
