With the rapid advances in technology, people can tune into their favourite OTT platforms anytime and anywhere, but how do you meet demand for such content.
A thematic seminar at the Hong Kong International Film and TV Market (FILMART) tackled ways of tapping into the over-the-top distribution platform market by producing and sourcing quality localised content, with contributions from representatives of four online entertainment companies.
Yang Xianghua, senior vice president of iQIYI pinpointed the fast-growing audience for OTT platforms in the Chinese mainland over the past few years.
"Within this year or next year, the number of people who watch streaming videos using mobile phone networks will reach half of the country's population," he said. "In view of this, iQIYI is actively working with our partners to produce high-quality full-length online films."
Two revenue models are in place - advertisement revenue and user fees - with the number of videos that generated more than Rmb1 million in profit for the company surging from 35 in 2015 to 122 in 2016, pointing to a huge online market.
Conference moderator Patrick Frater, Asia editor of Variety, raised the question of how to tackle the issue of many online entertainment companies running at a loss, Yang noting that iQIYI had "invested a lot" in purchasing and producing content. In order to attract audiences, a significant portion of the content is free in the early stages. However, he predicted that the platform will turn the deficit into profit, as the number of subscribers and page views increases and the pay-per-user model is established. "Young Chinese viewers are relatively affluent, so they are willing to pay for higher-quality content," he added.
Meg Lee, content management assistant vice president for PCCW Media's digital media division, said that "Korean content is king".
ViuTV was closely following the Korean trends and actively sourcing quality Korean entertainment video content such as dramas and variety shows, which have attracted a large numbers of fans of Korean trends to follow the channel.
She said ViuTV has its own team in each country, as well as an independent team in charge of collecting audience data and analysis. "We also work with different local companies so as to quickly grasp the demand of the local market." ViuTV has its own team of translators who translate related content into local languages.
"We can only stay at the forefront by seizing the opportunities from the fast-changing trends."
As audience tastes change quickly, companies need to constantly explore new initiatives and adjust their strategies, which results in high investment risks, Dan Zonmani told delegates.
The content business director of Line Company Thailand says LINE TV partners with various brands in co-productions of new online content, which in turns lowers investment risks, and offers diversified video content. "Besides local content, we also feature content from Japan and Korea while refining our existing content to cater to the local audience's taste."
Re-runs of dramas and live broadcasts are part of a multi-pronged approach to attract audiences. He added that in providing content that caters to Thailand's market, it was essential for the company to understand and respect the local culture while taking risks. "For instance, at the death of the King of Thailand, we purchased a three-hour film whose content revolves around songs that are written about the King of Thailand. Broadcasting such a lengthy film on LINE TV was a new attempt, and a worthy one."
Among various markets, Japan was one of the last to join the OTT platform revolution, since the country's traditional entertainment culture remains strong and it is difficult for industry players to break into the market. Nakase Keiko, director for the animation division and new business development at Mytheater DD expects a gradual increase in the number of Japanese audiences who watch videos on OTT platforms on mobile devices, and the market of VOD services platforms is expected to reach US$1.3 billion in value.
Despite the tremendous market potential, there are also various challenges for companies who wish to enter the market. For instance, while Netflix and Amazon produce original dramas for their VOD platforms in Japan, the companies face competition from traditional TV stations. Ms Nakase believed the companies must differentiate their programmes from traditional TV content. For instance, greater emphasis may be placed on star casting to arouse the audience's interest.
Online entertainment companies must cater to the audience's tastes, keep a firm grasp on market trends and provide quality, localised content to attract more viewers in order to tap into this fast-changing and tremendous entertainment services market.