Netflix’s Asia-Pacific content spend could hit US$1.9 billion in 2023, and revenues in the region are expected to grow 12% year-on-year to US$4 billion, Media Partners Asia (MPA) says in a new report, Netflix in the Asia Pacific, released today (6 March).

Japan and Korea, where ARPU growth is described as “robust”, are expected to lead growth in 2023.

“Japan is critical to Netflix’s prospects in the region, with the market contributing over a quarter to the company’s total APAC revenues in 2023,” says MPA executive director, Vivek Couto.  

MPA also identifies increased contributions from India, Indonesia, Thailand and the Philippines. “India, Indonesia, Thailand and the Philippines will contribute through a mix of subscriber and ARPU growth with impact in the Southeast Asia markets likely to felt especially in 2H as these four markets contribute more than 20% in aggregate to 2023 revenues,” Couto adds. 

Along with highlighting increased spend on original content and acquisitions in Asia, the report points out the higher travelability of Asian content in 2023.  

In Australia, MPA says a rebound in the “lucrative but saturated market”, including advertising tier growth, will  boost Netflix’s regional performance in 2023. 

Netflix’s US$1.9 billion local content investment in 2023 (representing 47% of revenues) will be driven by Korea and Japan, followed by India, Australia and parts of Southeast Asia. 

MPA’s lead analyst/head of content insights, Dhivya T, says Netflix’s APAC content investments “have global impact”.

“Leading Japanese series and anime together with Korean dramas and movies as well as movies from Indonesia and India have ranked among the globally top streamed titles over the past 12 months through January 2023,” she says. 

In 2022, Netflix released 29 exclusive Korean dramas, six of which ranked among the top 10 reaching titles in APAC in 2022, according to MPA subsidiary, AMPD Research. Netflix’s English global hit originals have also performed well in APAC, led by "Stranger Things" and "Wednesday". 

On the regional travelability scale in 2022, MPA/AMPD highlight India’s "Mismatched" S2, Thailand’s "The Whole Truth", Taiwan’s "Mom, Don’t Do That!" and Indonesia’s "The Big 4".

The report says that among Netflix’s top eight revenue-based scale markets in APAC, India and Indonesia will remain the highest growth. 

In Q4 2022, nine local originals drove viewership in India, the report says, adding that Netflix’s monetisation in India last year and through 2023 is a result of strong low-ARPU subscriber growth. 

Meanwhile, password sharing is at its highest in Indonesia, Korea, Philippines, Thailand and India, the report adds. The latest analysis comes a few weeks after Netflix slashed pricing in Southeast Asia by up to 46%.

“The move could further boost subscriber acquisition and upsell in these markets, as well as likely prepare the markets for [moves against] password sharing in 2H 2023,” the report says.