PCCW's Viu to push subscription and advertising on-demand model with SEA OTT boom

PCCW's over-the-top (OTT) video streaming service Viu has seen a significant increase in revenue last year coming from the Greater Southeast Asia (GSEA). To leverage the improvement, the company said it will combine the subscription video on demand (SVOD) model with the advertising video on demand (AVOD) model, tapping into the rapid growth in both sectors.

According to PCCW’s annual financial results announcement, Viu was reported to have an overall increase in revenue of 37% year-on-year in 2021 and have consistently delivered high growth revenue at a 36% compound annual growth rate since 2018. It highlighted that the Greater Southeast Asia (GSEA) region has been consistently outpacing the overall GSEA OTT market growth rate for the past two years, at 43% year-on-year growth in revenue against industry market growth of 35% for 2021.

Viu added that with its content lineup and strengthened commercial partnerships including distribution, it has seen a growth of approximately 30% in monthly active users as compared to 2020, reaching 58.6 million. Viu also enjoyed a total of 8.4 million paid subscribers as of the end of 2021, an increase of 58% from a year ago when paid subscribers stood at 5.3 million. Thailand and Indonesia were Viu's large markets and both of them saw strong growth. The Philippines and South Africa had high growth as well.

"We continue to pave the way in marrying the subscription video on-demand model with the advertising video on-demand model, allowing us to tap into the rapid growth in both sectors. We identified a content strategy and consumer proposition that is appealing to a wide and growing audience of pan-regional Asian entertainment which includes South Korean, Japanese and Chinese content to complement an
increased investment into Viu Original productions," said Janice Lee, chief executive officer, Viu and managing director, PCCW Media Group.

PCCW's ad revenue in 2021 doubled and it recorded a net profit of HK$1.04 billion in 2021. Many of its businesses enjoyed significant increases, including its free TV division and related business such as artiste management, event business, and increased advertising revenue. The group said in its annual result announcement for the year ended on 31 December 2021 that its robust performance across its core businesses of telecommunications, media, and IT solutions services against the backdrop of a stabilising environment in Hong Kong and continued expansion of the Group’s Media and Solutions Business regionally.

Its free TV and related business revenue grew by 152% to HK$800 million last year with advertising revenue more than doubling to HK$615 million.

The company also said, "Riding on the success of MIRROR as well as other up and coming artistes, its artiste management and event business flourished, with our artistes promoted 13 of the top 50 advertisers in Q3 2021. As a result, revenue from artiste management and event business increased almost tenfold compared to the previous year."

Looking ahead, to sustain the growth momentum, PCCW said its free TV and related business will continue developing quality content and find further ways to promote existing artistes and groom new talent, such as the recently debuted girl group COLLAR.

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