The local market for streaming video on demand, or SVOD, has become a whole lot richer in recent months, with three new paid platforms launching since July to join international heavyweight, Netflix. The four internet television services are now competing head-to-head for subscribers in Cambodia, but their biggest challenge is not each other, but rather persuading budget-conscious Cambodians to pay for video content in a market awash in free and pirated offerings.
Malaysia-based streaming platform iFlix, which launched in August, is the latest paid SVOD contender to enter the Cambodian market. Its arrival comes 18 months after the launch of Netflix in the Kingdom, but iFlix executives are confident its cheaper monthly rate (about $3 per month), emphasis on local and regional programming, and a distribution tie-in with mobile network Smart are fuelling a faster-growing subscriber base.
While Netflix does not report subscriber figures for individual countries, and iFlix keeps theirs closely guarded, iFlix Country Manager Adeana Greenlee said Cambodia has been one of the company’s fastest growing subscriber bases to date.
“iFlix is doing really well in Cambodia,” she said. “We’ve grown past other countries in the region that launched before us, in terms of the amount of subscribers we have. This is one of the better markets we’ve seen thus far.”
Competing against Netflix, which puts out top-rate original programming such as House of Cards, Orange Is the New Black and First They Killed My Father, is no easy feat. One key to iFlix’s impressive growth in its 21 markets in Africa, Southeast Asia and the Middle East is a tailored line up of local and regional content.
“We don’t take a cookie-cutter approach,” explains Greenlee.
But the company has also found an ideal distribution vehicle in a three-year exclusive partnership with local mobile operator Smart Axiata. About half of iFlix’s Cambodian subscribers have joined through Smart, which is advertising a three-month free trial of iFlix to its 8 million mobile subscribers.
Two homegrown SVOD platforms are also pushing for a slice of the market by offering more localised content. Sabay’s Soyo and Westec Media’s JaiKon TV, which launched successively in July, were developed specifically with the Cambodian viewer in mind.
Michael Chai, CEO of Westec Media, said JaiKon TV is going after a different market segment than Netflix and iFlix as it looks beyond the capital and hopes to capture the rural mass market. And that, he says, requires an entirely different pricing strategy and programming mix, with the focus geared toward low-budget Asian content.
“Our price point is going to be lower than iFlix’s, because our quality is not as good [as] we are catering to people who won’t pay more than $1 for entertainment,” he said. “Rather than competing with iFlix, it’s more like we’re competing with YouTube.”
In fact, Chai said he has already reached out to iFlix to propose cooperation, explaining that while the two companies may be competitors in the SVOD market there are other areas where cooperation could be mutually beneficial.
“JaiKon TV and iFlix can be seen as competitors, but there are other sectors of Westec that can benefit from working with iFlix,” he said. “It’s in my best interest if iFlix does well.”
Chai explained that Westec Media has acquired the local distribution rights to more than 600 Asian and Hollywood movie titles since 2011. While these big-budget titles are not suited to JaiKon TV’s programming model, they could be of huge value to iFlix.
“I’m willing to take all of my Hollywood rights and sell them to iFlix,” he said, adding that a deal was currently under discussion.
Sabay is taking a different approach, focusing on local content for its new Soyo platform but also investing in developing the Cambodian filmmaking industry to ensure a steady stream of local content.
“Our goal is to be a local [media] giant – to develop the market here, to stimulate it and to create jobs,” said Selena Luong, Sabay’s head of project development. “We are not talking with iFlix – we are focusing on our own content for now.”
Through its monthly short film competition, Soyo is providing funding to talented young writers and filmmakers to help turn their ideas into short films.
“We want to identify these people, give them opportunities and invest in them,” said Luong. “No one else in the market is doing that.”
There are questions, however, about whether the capital investments these SVOD platforms are making in licensing or developing local content will generate sufficient returns through subscriptions.
Westec Media’s Chai said with so much free and pirated content available on the internet, “the biggest challenge to our industry right now is creating a habit for people to pay for content.”