Vidio Targets 8M Subscribers Pre-IPO, Eyes $2.25B Market

Key Takeaway

• Vidio aims to double its subscriber base to 8 million in 2-3 years as part of its IPO preparation strategy.
• Indonesia's streaming market is set to grow, with online video revenue projected at $2.25 billion by 2028 amid challenges.
• Vidio focuses on sports content and original productions, competing with giants like Netflix while leveraging upcoming 5G rollouts.

Subscriber Growth Strategy

Vidio, often referred to as Indonesia's counterpart to Netflix Inc., has set ambitious goals to double its paid subscriber base to 8 million within the next two to three years. This growth is part of the company's broader strategy to strengthen its position in the Indonesian market ahead of a planned initial public offering (IPO). Owned by PT Elang Mahkota Teknologi Tbk, an Indonesian media conglomerate, Vidio is also seeking to raise new funds this year to support the expansion of its streaming service, as stated by CEO Sutanto Hartono. The decision to pursue an IPO will be contingent on favorable market sentiment.

Market Potential and Challenges

Indonesia, with its rapidly growing economy and youthful population exceeding 270 million, presents a fertile ground for digital media expansion. Despite the dominance of free-to-air TV and the current low penetration of 5G technology, the potential for streaming services growth is significant. According to Media Partners Asia, online video revenue in Indonesia is projected to increase from $1.3 billion in the previous year to $2.25 billion by 2028. Furthermore, the economic impact of the country's film and TV industry is expected to grow by 20% to around $10 billion by 2027. However, challenges such as low subscription prices and the prevalence of ad-dependent platforms pose hurdles for premium subscription models in the Indonesian market.

Content Strategy and Competition

Vidio differentiates itself through a strong focus on sports content, aiming to transition viewers from traditional TV to digital platforms for live sports viewing. The platform has successfully streamed significant events like the Asian Games and the English Premier League, drawing substantial viewership. Additionally, Vidio is expanding its original content production, including series and films, to cater to diverse audience preferences. This strategy positions Vidio in direct competition with global streaming giants like Netflix, which continues to invest in the Indonesian market, evidenced by the planned release of six new original productions.

Technological Advancements and Partnerships

The anticipated nationwide rollout of 5G technology is expected to be a pivotal factor in accelerating the growth of streaming services across Indonesia. With approximately 10 million 5G customers currently, projections suggest a tenfold increase over the next five years. Vidio is proactively preparing for this shift by collaborating with local telecom providers and appliance manufacturers to integrate its service into mobile bundling packages and connected TVs. These partnerships are crucial for building a comprehensive digital ecosystem and fostering customer commitment to subscription services.

Street Views

• Malobika Banerji, Netflix (Bullish on Netflix in Indonesia):

  "We are already seeing very promising signals, and the task for us is to make this more consistent drumbeat... But first, we want to make massive and big hits in the local industry."

• Vivek Couto, Media Partners Asia (Bullish on streaming market growth in Indonesia):

  "It’s a key technology to help boost the streaming market growth outside Jakarta as most of the consumption is currently centered around the capital."

Management Quotes

• Sutanto Hartono, CEO of Vidio:

  "In the past, Indonesia was always a sexy market for a lot of global players because of the population." "But once you get it, there is a tipping point that it becomes like a lifestyle."