There are growing signs that OTT video in emerging markets require a deep understanding of consumer preferences where the traditional 'rules of the game' may not apply.
Asia-based streaming service, iflix is making a strategic move to switch from its traditional subscription video (SVOD) model and replace it with a strategy that it says is better adapted to emerging markets. The new model for iflix will be a hybrid combination of a free tier, a curated films of the day, and a strong lineup on producing premium short-form content.
iflix which launched three years ago and targets only emerging markets – initially South East Asia but now also the Middle East and Africa – has 11 million active users as of March 2018. The video on-demand service aims to hit 30 million users within the next six months by which time its funding situation will have significantly improved. The free tier will be partially advertising supported, requiring iflix to set up an ad-sales team.
iflix will also focus on creating a live hub that offers local linear free and pay-TV channels, and live sporting events including Malaysian soccer, cricket, World Cup, Olympic Games, and NBA action. Premium live programming would also include local and regional concerts and competitions.
The short form content plans comprise of ramping up original iflix content and localized formats. New formats designed for mobile viewers called iflix snacks will be developed, and up to 2,000 pieces of short form content are lined up to be produced by the company’s new short form production arm - Studio 215.
“When we began iflix, we naively believed that the Western entertainment model could easily succeed in emerging markets, and that price, would be the primary customer pain point,” said CEO Mark Britt in a statement. “Three years later, we have a much deeper understanding of the localization requirements, and infrastructure, payments and authentication issues within our territories. The data and learning we’ve acquired challenge many of the traditional metaphors that exist within our industry.”
In a recent talk at the The Wall Street Journal’s D.Live conference in Hong Kong, Patrick Grove, co-founder of iflix, said with a fast growing number of paying subscribers for online content, China is leading the way in the live-streaming revolution and consumption of OTT video. iflix considers itself a complementary service to Netflix thanks to its focus on emerging markets and local content.