Increasing streaming subscribers signals viewing preferences

While OTT penetration rose in 2019, daily TV viewers continued to grow among ages 15+ in Peninsular M’sia

by RAHIMI YUNUS / pic by BLOOMBERG

MALAYSIA registered close to one million new over-the-top (OTT) or streaming subscribers last year to 14.1 million users, representing about 78% of the ages 15+ viewing population, according to Nielsen data.

Increasing broadband access and smartphone penetration in the country have led to the rise of online TV streaming services, also known as OTT platforms or “Internet TV”,  with more users abandoning decades-old free-to-air (FTA) TV and pay-TV to watch their favourite movies, series and entertainment programmes.

Nielsen Media Malaysia head Jon-Paul Best said while OTT penetration has picked up further in 2019, the number of daily TV viewers continue to exhibit growth among 16.7 million TV audience ages 15+ in Peninsular Malaysia.

The consumer intelligence firm revealed the number of TV viewers who concurrently use OTT services posted an uptrend last year with 900,000 more users than in 2018.

Nielsen tracks various OTT platforms in Peninsular Malaysia including Netflix, HyppTV, tonton, YouTube and others through its Consumer and Media View service.

The Covid-19 pandemic and the subsequent Movement Control Order (MCO), implemented since March 18, have boosted both OTT and FTA TV viewership as people were forced to stay at home.

“The impact of Covid-19 and the MCO period is likely to accelerate the growth of these numbers. Based on early indicators of media audience behaviour, however, OTT may be consumed complementary to traditional TV, rather than automatically competing against it,” Best told The Malaysian Reserve (TMR).

Nielsen previously reported that the MCO has sparked an average 30% rise in TV viewers. Pre-MCO, the balance between medium viewers who watch eight to 16 hours per day and light viewers (zero to eight hours per day) was well distributed at 49% and 44% respectively.

By April 12, Nielsen said that had changed to 58% and 32% respectively, showing a notable portion of viewers transitioning into the medium viewer category. The change resulted in the average daily time spent watching television rising to seven hours and seven minutes from five hours and 36 minutes before the MCO.

At the end of January, Nielsen said the population viewed about 29 million hours of television daily, but that rose to 43 million hours, up 49%, by April 12.

In another study, the Malaysian Digital Association (MDA) at the end of March reported demand for entertainment rose on a spike in streaming video consumption.

Netflix gained 195% in sequential traffic in March on a rolling seven-day basis, tonton (232%), dimsum (140%) and Viu (140%), according to a study by the MDA and its market intelligence partner SimilarWeb Ltd.

Using January as a base, the report compared year-on-year change for February, the first half of March and a rolling seven-day period (March 15-21) to chart the growth in traffic.

Besides people holed up at home, a media analyst said the increased eyeballs in TV/OTT during the MCO can be attributed to the closure of cinemas nationwide and thus TV/OTT became the main source of entertainment.

The analyst said the greater flexibility and ease-of-use of OTT over TV has driven the growth of the services and the platforms remain a threat to TV.

“In my view, OTT is a threat to TV in Malaysia. Over the years, we have seen consumers shifting towards online, over-the-Internet and social media contents from the traditional TV and pay-TV,” the analyst told TMR.

Universiti Teknologi Mara’s Faculty of Communications and Media Studies deputy dean of academic affairs Dr Wan Hartini Wan Zainodin said challenges remain for FTA TV to sustain the bumper viewerships recorded during the MCO.

“It will be very challenging for traditional TV to sustain the momentum as the audience gets segmented these days and they can choose what they want to watch specifically according to what they subscribed to,” Wan Hartini told TMR.

She said local media organisations have to adapt to the trend of online streaming or risk being left out.

Pay-TV operator Astro Malaysia Holdings Bhd ventured into the OTT market with its own OTT platform called Astro Go in 2012, Media Prima Bhd with tonton (2010) and Star Media Group Bhd with dimsum (2016).

Astro CEO Henry Tan recently said the firm plans to strengthen its position as the preferred entertainment destination by deepening engagement with its 5.7 million customers via new experiences such as 4K UHD and cloud recording, as well as more value and convenience.

“Our content and broadband bundles offer even more value and convenience, as well as unlock our rich On Demand library of over 50,000 titles. Meanwhile, NJOI, our freemium TV service, offers Malaysians a compelling free TV proposition with options to purchase additional channels and content,”

Tan said after the group’s AGM. Astro also plans to introduce more streaming services for its customers. It currently has three exclusive streaming services — namely Astro Go, HBO Go and iQIYI.

“We will aggregate more streaming OTT services to be the digital content provider of choice. We will also continue to [optimise costs], pursue active capital management and reprioritise capex (capital expenditure) to ensure financial headroom for a challenging year ahead,” said Tan.

China’s media giant Tencent Holdings Ltd recently purchased Malaysian video streaming platform iflix’s content, technology and resources, but the details of the deal were not disclosed.

The acquisition was said to be in line with Tencent’s aim to expand its international streaming platform, WeTV, across South-East Asia and to provide users with international, local and original high-quality content in a wide range of genres and languages.

The entry of Tencent in the region’s OTT landscape is set to heighten competition in the market.