August 9, 2019
By: David Lozada

KUALA LUMPUR, Malaysia -- “TV is dead. Long live, TV!”

This was how iFlix CEO Mark Britt concluded his talk on “The Future of TV” during the WILD Digital Conference in Kuala Lumpur in July 2019. In his presentation, Britt outlined 5 lessons the company has learned over the course of five years. 

iFlix is a free and subscription video on demand service focused on emerging markets. Founded in 2014 in Kuala Lumpur, the streaming service currently has more than 25 million subscribers across 22 countries in Asia, the Middle East, and North Africa. 

Comparing the years iFlix has been operating to seasons of a television series, Britt noted: “Season 2 was the toddler running around having self-discovery. Season 3 was the massive global expansion. iFlix is now on Season 4. This is a critical season.”

Britt added that video streaming is now a much more focused industry. When iFlix started in 2014, they had 35 competitors all over Southeast Asia. Now, there’s only 4. The company is now focused on providing a full entertainment experience rather than minding its competitors.

What has iFlix learned over the last 5 years that gives an insight on the future of TV? Britt outlined 5 points.

1) Millennials are the market

First, Britt noted that companies need to tap the massive young middle-class population in emerging markets in order to grow. Sixty percent of Southeast Asia’s population, for example, is under the age of 35.

“We always talk about millennials as if they’re something that’s gonna happen in the future. We talk about millennial trends that are about to happen. They are not the future. The millennial market is here,” Britt said.

2) Mobile is not over

In connection to the millennial market, Britt noted that 80% of Southeast Asia’s millennial population -- or half a billion people -- have mobile as their preferred consumption device. It is on this note that, for Britt, while the mobile war has been won and lost in some industries, it is not over for tech platforms.

“Mobile is not a companion to some other device. It is the core paradigm, the center of people’s lives, the super computer in our hands,” he noted.

3) Thriving local culture beats global hegemony

An interesting -- and somewhat unexpected -- learning for iFlix is that local content is king. With the company’s expansion over the first half of 2019, they’ve witnessed local content overtaking every other Hollywood-produced movies and shows. 

KL Gangster, an award-winning Malaysian film, for example, topped the box office in Malaysian cinemas. iFlix ran a spinoff TV series, KL Gangster: Underworld, which then broke every single record on the streaming service. 

Such trend was also noted by ONE Championship during WILD Digital. The company’s Vice President Misha Tate said that the key to achieving 1.7 billion views is to produce inspiring local content, and to create local heroes. 

For Britt, this trend also allows iFlix to push and challenge local norms. The Malaysian show Nur, which tells the story of an Imam who falls in love with a prostitute, fuses religion and sex, in a way that pushes boundaries. 

“Of all the people who watch episode 1,” Britt noted, “92% went on to complete episode 8.”

4) Data trumps everything

iFlix has grown from 6.5 million users to 19 million users from 2018 to 2019. That means the company now has 10 times more data than a year ago.

“We’re getting 2 billion signals every day. It’s our app signal, our completion rate, our binge watch intensity. We get insights on our customers now that is far more profound than anything we’ve expected,” Britt said.

With this data, iFlix is able to offer shows of different genres based on the people’s psychographics. From an advertising perspective, this is a huge potential.

5) Some things still make no sense

Lastly, Britt noted that in spite of all the patterns and trends they’ve observed, there are things that still make no sense.

For example, a study of TV consumption rate over the last 5 years in Southeast Asia shows that older demographics (65 and above) are watching more TV than ever before. This is because there are twice as many good shows and movies. But anyone under the age of 25 don’t even change channels anymore -- more so turn the TV on -- because they mostly consume content on their mobiles.

With less people watching TV, it was expected that advertising revenue would be in decline. What’s happening is the complete opposite. TV advertising revenues in the region grew by 4.4% again (equal to USD 4.4. Billion) in 2018. TV consumption is also up 56% in the region.

GROWING. On its 4th year, iFlix CEO Mark Britt says the company is focused on providing the full entertainment experience to its customers rather than minding its competitors. Photo by Tammy David.

The Philippine Experience

How do these trends manifest in the Philippines?

A study in March 2017 by Kantar Media Philippines shows that TV still rules the media landscape, despite the growth of mobile facilitated by faster and affordable data services. The study further noted that daily television viewership rose to 96.6% in 2016 from 91.2% in 2014. During the same period, time spent watching TV also rose from 3.4 hours to 3.7 hours.

In a way, the Philippine experience echoes the trends noted by Britt. Local culture and consumption habits play a big role in this.

Why is TV still the ruling platform? Well, a simple explanation is that Internet penetration rate is still concentrated in urban areas. Radio and television are still pretty much the dominant media in rural areas where there’s no signal or where people can’t afford smartphones.

“Mobile is not a companion to some other device. It is the core paradigm, the center of people’s lives, the super computer in our hands,” iFlix CEO Mark Britt

Even cable subscriptions weren’t as affected by free video streaming platforms. When HOOQ and iFlix entered the Philippines in 2015, they were expected to shake up the established cable platforms. But instead, both cable and subscription video-on-demand found a way to co-exist. What SVODs introduced however was multiple screen viewing. This is why most cable packages are now bundled with Internet plans and SVOD subscriptions.

ABS-CBN, the country’s biggest TV network, is also adapting. It launched its streaming platform iWant in November 2018. Other players are expected to adapt.

Why is TV still the ruling platform? Well, a simple explanation is that Internet penetration rate is still concentrated in urban areas. Radio and television are still pretty much the dominant media in rural areas where there’s no signal or where people can’t afford smartphones.

Industry applications

We in the local communication and digital marketing spaces can learn from TV and SVODs. There is still a very healthy coexistence between traditional and digital channels -- and we should be able to use them both. 

From past campaigns, we realized that these platforms complement and not compete against each other. In running campaigns, for example, TV should not be the sole focus of advertising. Communications campaigns should utilize big data to achieve its goals and to target the right audiences.

Likewise, we have seen examples of communication campaigns that have failed because it focused only on new media platforms. TV is still not dead, and in our opinion, will not be so in the Philippines for a long time. 

At the end, companies either adapt or die. At least in the Philippines, as long as networks continue to adapt to new trends and technologies, TV will just take on different forms.

David Lozada is Evident’s Associate Director for Corporate and Public Affairs. He recently finished his Master of Development Studies (First Class Honours) degree from The University of Melbourne in December 2018. Prior to this, he was an award-winning journalist and community manager for Rappler from 2013 to 2017.

Photos by Tammy David

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