Amazon's Prime Video is betting big on the Asia-Pacific region, aiming to become the go-to 'entertainment hub' for streaming services. This strategy, unveiled at the APOS media conference in Bali, marks a significant shift in the streaming landscape, moving away from standalone apps towards a more integrated, bundled approach. The company's vice president for Asia-Pacific, Gaurav Gandhi, argues that the region's diversity necessitates a unique strategy, emphasizing the importance of a hub model that ties together originals, partner channels, rentals, and add-on subscriptions. This model, he claims, offers both customers and content partners the best of both worlds: a wide selection of content through a single app and billing relationship, and distribution and a massive audience without the need for their own tech and payments infrastructure.
What makes this strategy particularly fascinating is its alignment with the broader industry trend towards aggregation and bundling. This shift is especially crucial in the Asia-Pacific region, where developed markets are crowded and margins are low. Prime Video's approach, which isn't entirely new, is particularly well-developed in India, its largest Asian market. Here, the company is folding a free, ad-supported tier into its paid service, integrating Amazon MX Player to offer a combination of premium subscriber base and free reach that is selling to creators and advertisers as scale that only Reliance's JioStar can realistically rival. This strategy is not only about scale but also about meeting the diverse needs of the region's customers, with over 60% of Prime Video's customers in India streaming in four or more languages, and the platform programming in 10 languages with deep investment in Hindi, Tamil, and Telugu.
In Japan, Prime Video's second-largest APAC market, the company has had to build a subscription-streaming habit from scratch, establishing an entirely new category of subscription video in a market still anchored to free-to-air television. This has been achieved through a broad content strategy across four pillars: anime, scripted entertainment, unscripted programming, and live sports, including a live boxing business and a slate of manga adaptations that have connected with local audiences. This approach, Gandhi suggests, is central to Prime Video's global plans, not just as a key driver of growth but as a market where new ideas are generated, some of which could eventually be rolled out elsewhere.
However, this strategy is not without its challenges. The crowded nature of the region's developed markets and the low-margin realities of the rest require Prime Video to be innovative and adaptive. The company's success in India, for instance, is not just about scale but also about understanding and catering to the diverse linguistic and cultural needs of its customers. This includes not only multilingual programming but also the integration of local content and the recent arrival of Amazon MGM Studios' local operations, which suggests a growing willingness among Indian viewers to pay for premium cinema at home.
In conclusion, Amazon's Prime Video is betting big on the Asia-Pacific region with its 'entertainment hub' strategy, recognizing the importance of aggregation and bundling in a diverse and crowded market. While the company faces challenges, its success in India and Japan suggests that it is on the right track to becoming a central aggregator that others can simply plug into. From my perspective, this strategy is not just about growth but also about understanding and catering to the unique needs of the region's customers, which could ultimately be a key to its global success.
