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Survey finds Filipinos willing to pay extra for OTT carrier-bundled services

According to the latest survey of Amdocs, Filipino subscribers of carrier-bundled OTT media services spend more when the offerings are bundled as part of a mobile or home broadband package. These same consumers are also among the most likely to remain loyal if provided with the right media offer.

Amdocs, a provider of software and services to communications and media companies, conducted an extensive study of the over-the-top (OTT) media service markets in the Philippines and other emerging and advanced markets in the Asia Pacific (APAC).

The results, which reflect consumer sentiments shortly before the COVID-19 pandemic, remain even more relevant in today’s context given the rise in OTT content consumption. The survey also found that Filipinos are some of the most avid users of OTT media services, concluding that the percentage of people subscribing to paid OTT services would grow dramatically if they were made more affordable and accessible through bundling and innovative pricing models.

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Conducted by analyst and consultancy firm Ovum on behalf of Amdocs, the study surveyed more than 4,000 consumers in five emerging and developed countries in the Asia Pacific, with over 20% of the respondents coming from the Philippines. Other countries surveyed are India, Thailand, Australia, and Singapore. The research also included qualitative conversations with 13 communications service providers and 12 OTT media players in the region.

Video streaming

“The OTT streaming market in Southeast Asia, including the Philippines, is heating up, with the Tencent and IQiyi faceoff against Netflix and Disney adding further intensity,” said Guillermo Escofet, principal analyst at Ovum (Omdia). “With COVID-19 slowing down the economy and negatively impacting incomes, however, carrier-bundled services offer the best opportunity for OTT players to grow their market. We believe that if service providers can quickly innovate with their pricing models and rapidly add more OTT partners to their tariff bundles, they will come out as clear winners.”

Carrier-bundled media services drive consumers to spend more and maintain loyalty: Forty-four percent of Filipino respondents said bundling media services with their telecom plan was the main reason they were willing to spend more on their mobile and fixed broadband subscriptions. A similar percentage (44%) said access to such a service made them less likely to switch providers, while 25% said they might switch in the absence of attractive bundled offers.

Paid OTT services

Filipinos are some of the most avid consumers of paid online video despite the Philippines having the most nonbundlers out of the emerging markets in the study: Interestingly, 55% have access to or are subscribed to paid OTT services. Only half, however, were subscribed to a bundled media service. The survey also found that discounts and free trials can hook more consumers: 53% are willing to pay for premium media services via their carrier bill if offered a discount or an extended free trial – but only if offered by their existing provider.

OTT services remain expensive for most Filipinos; pay-per-use and advertising model are more promising than monthly subscriptions: The average online video subscription (P242) is too expensive for nearly 51% of consumers. The maximum consumers would willingly pay for a monthly online video subscription is: P50-P150 (17%); P151-P300 (28%); P301-P450 (21%); P451-P600 (16%); P800+ (11%).

The unaffordability of paid OTT subscriptions may worsen as COVID-19 impacts the economy and individual incomes. Seventy-two percent of Filipinos would purchase a one-time pass for specific content or short-term access to content to avoid paying for a full subscription. Filipinos would willingly share personal data and do not mind ads in return for a discount. Seventy-five percent of Filipinos are okay with ads if they bring the cost of OTT entertainment down, and 64 percent would share data in order to receive targeted ads.

Foreign movies and drama series and local content attract most Filipinos: Foreign brands — both regional and global — dominate viewership in the Philippines. Netflix is a clear market leader, followed by iFlix and Fox+.