Last week I attended APOS in Singapore, one of the major annual events in the region organized by Media Partners Asia. After the last couple of years attending virtual events, it was so refreshing to be finally back to an in-person event, to meet and discuss with other partners, customers, and industry peers on the future of home entertainment. It was also a great opportunity for me to do a reality check' on my understanding of the current challenges, and what to expect.
One of the most awakening moments for me was the statement during the panel A Post Pandemic View of Media & Entertainment , and that was Too many players chasing a shrinking monetization pool in a recessionary environment . While it's certainly true that a big storm is brewing, the future is also bright with many opportunities coming out of this challenging time, and this is what we discussed during the two days.
Key Points Round-Up
First, we should expect to see continued consolidation. Panelists cited too many players, SVOD revenues have already peaked, and we now live in an era where macro-economic conditions will make for tough operating environments in which organizations can thrive. If we draw parallels with the music industry, they have experienced service consolidation that enables the same access to content with any service provider. It will therefore be interesting to see if our industry's progressive adoption of the same model will provide aggregated bundles of rival streaming platforms.
Climbing USD currency rates will also make it difficult for operators to keep offering foreign content with stagnating ARPU. So irrespective of consolidation, local content demand, that already accounts for more than 70% of all contents in countries like Japan, Korea and India, will continue to grow globally in the region; Vidio for example already edged Netflix and Disney+ in Indonesia and mostly focuses on local or regional content.
Premium AVOD is also expected to significantly increase. Disney and Netflix's moving to an ad-supported tier is already a signal of consumer maturity in SVOD, but with a darkening macro-economic environment and the average consumer purchasing power decreasing, churn is likely to increase. Premium AVOD will therefore play an important role in reducing churn while reducing subscription costs.
Finally, let's consider increasing consumer frustration levels where favorite shows can't be accessed due to a lack of content availability or barriers to entry created by high subscription prices. We should also expect piracy to further increase as more will turn to piracy to watch their favorite content. Pirates will also seize the opportunity to offer broader services that appear genuine and lure consumers away from paying services.
Future Developments
Our industry needs to continue to find innovative ways to reduce churn, attract new consumers and stay relevant beyond just aggregation. Topics such as loyalty (such as rewards, gamification, vouchers, and credits), personalization (such as AI-based recommendation, tagging and tracking, user avatars), social features (such as communities, share with friends and in-show voice and chat) and flywheel (such as e-commerce, games, livestream and literature) all have a key role to play as we collectively evolve to changing consumer behaviors.
It was these themes that Nancy Goldberg, EVP of the Kudelski Group and Chief Marketing and Sales Officer for NAGRA, shared during her APOS interview with Vivek Couto, Executive Director & Co-Founder, at Media Partners Asia.
At NAGRA, our aim is to help today's consumers safely find and access the content they love. This also involves broadening their experience within the home environment to help consumers manage both privacy and their digital lifestyles. NAGRA solutions such as NAGRA Scout, which are designed to protect connected lifestyles, are great examples of complementary services that broaden the operators service portfolio, drive new revenue, and engender loyalty.
NAGRA can also help our customers navigate today's pronounced market challenges, by focusing on consumer behavior. NAGRA can provide hyper personalization through innovative solutions such as Smart Pricing where consumer behavior data is combined with our AI platform to depict a subscriber digital twin. This means changes to their subscription can be trialed and the likely impacts measured ahead of real-world deployment- ensuring churn and revenue can be optimized.
So, was it a good event? Definitely! There are some challenges ahead, but balancing all the conversations I had, my conclusion is that the consumer dynamics and lifestyle in Asia provides a rich playing field in which we can all thrive. For our part, NAGRA stands ready to help our customers with innovative solutions that will support connected lifestyles, address emerging challenges, and explore new opportunities. To continue the conversation, contact us or visit NAGRA for more information.
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Last week I attended APOS in Singapore, one of the major annual events in the region organized by Media Partners Asia. After the last couple of years attending virtual events, it was so refreshing to be finally back to an in-person event, to meet and discuss with other partners, customers, and industry peers on the future of home entertainment. It was also a great opportunity for me to do a reality check' on my understanding of the current challenges, and what to expect. 
