Piracy Is the Biggest Challenge for Southeast Asia's Own Streaming Service


AUGUST 31, 2016

Jakarta. The toughest challenge facing video streaming services in Indonesia is winning over customers who have become accustomed to easy access to illegal copies of films, a top executive of video-on-demand platform iflix said on Wednesday (31/08).

"Our biggest competition is not the big names," iflix Indonesia chief executive Cam Walker told reporters on the sidelines of the Indonesia ICT Summit 2016, which is taking place at the Jakarta International Expo in Kemayoran, Central Jakarta.

"We don't look at what they are doing per se, but what we're trying to do is provide a viable alternative to piracy," he added.

Walker was speaking during the two-day summit, which brings together information and communications technology industry players in the region.

The Association of Indonesian Songwriters and Music Arrangers (Pappri) estimates that the country's music industry loses Rp 4 trillion ($301 million) annually to piracy.

In addition, the United States has placed Indonesia on a so-called priority watch list, released earlier this year because of concerns over the lack of action by the government against piracy and counterfeiting.

The subscription-based video-on-demand service wants to make Indonesian people choose its streaming service over piracy by offering features that are specially tailored to their needs, including a low price of around Rp 39,000 per month, subtitles in Bahasa Indonesia, a huge selection of movies for the whole family, and local content.

The streaming service also offers relatively cheap bundled packages with service providers, such as Telkomsel and Indosat Ooredoo, that are easy to purchase.

According to Walker, iflix will offer a social feature later this year where users can chat with others or interact with local celebrities who have drawn up movie playlists for them.

"There is no certainty whatsoever [that people will choose to pay, instead of illegally copying movies], but we're set to try by providing a viable alternative to piracy," he said. "It doesn't come easy and requires a huge amount of investment."

Many have also questioned the video streaming service's chance to compete head-to-head with similar services that are already well established in the country, such as Netflix and Hooq.

Malaysia-based iflix launched it service in June this year – earlier than expected – due to the launch of its competitor.

However, by August Southeast Asia's own streaming service had already performed 250,000 activations in about two-and-a-half months. The streaming service gained one million subscribers globally last year.

In comparison, rival Netflix has around 83 million subscribers in 190 countries.

"If you look at Netflix; Netflix is very much into an original production base... another platform. They really focus their investment on content and user experience and interface," Walker said. "We have just most recently decided to venture beyond an entertainment service into becoming a truly social platform for television."

Walker said he prefers to see other streaming services not as fierce competitors, because they are all "heading in different directions."

"We're going to be investing heavily in local productions and local acquisitions as well, which I think will differentiate us from the major international players," he said.

Walker said iflix will soon produce its first local Indonesian content that will open more opportunities for local actors, producers, directors, scriptwriters and "the new breed of Indonesian talent."

The service is also available in Malaysia, Thailand, the Philippines, Sri Lanka and iflix is keen to enter more emerging economies such as Vietnam, Pakistan, and several countries in Africa, the Middle East, Eastern Europe and Latin America.

Walker said the company has yet to consider China and India as it wants to focus on emerging countries with around $22 billion annual market potential. That excludes China and India.

"By the year 2020, we believe there will be 3.4 billion people who can afford $3 for content, and that does not include China and India," he said.