Producers in Southeast Asia are facing a very different, much quieter landscape to the one in front of them just 12 months ago, as U.S. players rein in their spending to appease shareholders, and neighboring countries such as Korea, Japan and India draw attention.
Southeast Asia, which at one point was considered a key growth opportunity for international streamers such as Prime Video and Disney+, has seen money drain out of its main markets. Spending was reeled in and layoffs hit original production staff amid the global streaming reset of last year, and the region has been one of the worst hit as a result.
In fact, Netflix remains the only major American streamer still commissioning across the region — albeit at what several sources say is on a smaller scale in most countries compared to a few years back. (Netflix insiders refute this.) Disney+ and Prime Video have both completely cut their originals teams in Southeast Asia, opting instead for licensing and U.S. content, while the likes of Paramount+ and Max have limited or no presence yet.
Of course, the recent developments trace back to Wall Street, and shareholders’ demands that global streamers stop chasing subscriber numbers and start making money. “The whole business changed to profitability, and everybody started freaking out around the world,” said one source who was impacted by the streamer layoffs. “When that Wall Street news hit, that’s when we stopped having money to spend.”
Geographically, Southeast Asia comprises 11 states and is located in the area east of the Indian subcontinent, south of China and north of Australia. Korea and Japan neighbour to the east. Indonesia, the Philippines, Vietnam, Thailand, Myanmar and Malaysia are the largest countries by population, and have provided many of the original productions out of the region, though the small but high-functioning city state of Singapore is among the most influential media hubs in the region, with the likes of Prime Video and Netflix based there.
The area’s importance as a TV and film maker has been growing as streaming took off, but it has been relatively lowkey compared to other territories in Asia. Notably, there has been the inexorable rise of Hallyu (South Korean) content and booming interest in Japanese anime to the east, plus continued streaming growth in the competitive Indian market to the west. The mega-populous Asia certainly remains a significant strategic focus for the streamers’ growth plans, but most are now primarily targeting the countries either side of Southeast Asia.
For example, Netflix and Disney+ have both prioritized original production in Korea, with the former famously committing more than $2.5B for K-content creation over coming years and sources at the latter indicating this is where spend in Asia will go primarily. Paramount+ has been working with local Korean streaming TVing on original programs, though it’s not clear how the U.S. company’s move out of international production in most of the world will impact that.
Netflix, Disney and others are pushing deep into anime from Japan, and most are entrenched in India, where streaming has boomed for several years now. Amazon is heavily invested in the latter, which Prime Video and Amazon MGM Studios boss Mike Hopkins recently revealed is driving more Prime subscriptions than any other country bar the U.S. Disney was the Indian streaming market leader through its Disney+ Hotstar platform, but is merging its local operation with Reliance Industries after a difficult 2023. Netflix, meanwhile, says last year was its “most successful” in the country to date and is offering new buzzy originals such as Heeramandi: The Diamond Bazaar on its latest slate.
It’s a complicated picture, but one that shows success in Asia can’t be guaranteed, and especially in what some might refer to as “emerging” entertainment markets such as Malaysia or Thailand. Gaining profitability where it’s possible is now the name of the game.
Netflix rejects the idea it is pulling back on spend in Southeast Asia and the sense that is has reallocated cash out of Southeast Asia and into other countries. It is true to say its Thailand slate grew from six originals in 2023 to ten this year, and streamer is also working on upcoming originals with the likes of Indonesian filmmaker Joko Anwar and the country’s first big-budget female-fronted action film, Timo Tjahjanto’s The Shadow Strays, but multiple production sources sense a change in momentum.
Malobika Banerji, Head of SEA Content, Netflix told us in a statement: “Our continued investment in Southeast Asia goes beyond series and films, we’re supporting a new generation of local storytellers. This includes creating opportunities for first-time filmmakers and providing skills training for production staff across all levels. We want to see continued growth for the local industry and enable these vital stories to be shared on a global stage.”
Whatever the case, plenty of global streaming money that might have fed into Jakarta, Kuala Lumpur or Bangkok a year ago is more likely to be spent in Seoul and Tokyo — or no longer exists at all.
There’s a human cost to the change, of course. As we revealed in January, most all of those working in originals at Prime Video’s Singapore office were let go, with around 25 remaining to work on other content initiatives under Director David Simonsen. Local original content that has already wrapped production or been greenlit will continue to launch through 2024 and 2025, but no new titles are forthcoming and licensing and U.S. content is now the priority. Most staff are now searching for new work. Aparna Purohit remains Head of India and Southeast Asia Originals for Amazon Prime Video, but will be primarily focused on India moving forwards.
At Disney, the Executive Director for Content and Creative in Southeast Asia, Ahmad Izham Omar, was the head of about 15 staff in Indonesia who exited in two tranches, mostly in January and February. His team had overseen a slate of around 20-30 projects from Indonesia, Malaysia and Thailand, we understand.
Having known their fates for months before their exits, several of the Disney departed quickly found roles in the local production sector. For example, former Primeworks Studios CEO and Pulang screenwriter Izham founded Malaysia-based Komet Productions, while Jessica Kam-Engle, Disney’s former Head of Content and Development for Asia, is leading Banijay Asia’s new venture, CreAsia Studios. Her former colleague Yee Yao Chang is also on board in a VP role. Fauzan Zidni, an executive producer on the originals team looking after Indonesia, exited in early February and soon joined Cinesurya Pictures.
The writing on the wall
Both Disney and Amazon (along with several others) made mass redundancies across their global footprints to address crashing revenues and a brutally tough media environment in 2023. Disney and Amazon declined to comment for this article.
The commissioning stop of two major streaming players has been hard on local producers, though their time in the originals market was fleeting. Prime Video had only unveiled its first local slate in late July 2022, with the likes of a trio of Comedy Island shows for Indonesia, Thailand and the Philippines. Disney had focused heavily on Indonesia (where its streaming service is known as Disney+ Hotstar), ordering originals that notably included a local version of Call My Agent!, shows such as The Talent Agency (Hubungi Agen Gue!) and superhero action film Sri Asih.
Disney’s decision to stop commissioning originals in the region came as more of a surprise to many industry professionals. The company had been shutting down many of its linear channels across the region as part of a broader streaming model pivot, but the streaming switch up still caught producers unaware. Insiders had expected Disney+’s original programming slate to grow steadily, given the studio’s much longer track record and deep understanding of the region, while a number of media veterans had seen the writing on the wall with Amazon as the company-wide cuts plans emerged.
“Prime Video came to the country and started making deals with with many producers and directors,” said one Indonesian director who was developing a remake project with the streamer, and also currently has developments in place with Netflix. “I was already positioning very cautiously because Amazon doesn’t have an e-commerce business in Indonesia, so they were vulnerable and could make cutbacks anytime.”
This source added they had focused on making “pre-buy” deals with streamers instead of commissioning deals, as the arrangement made more sense financially. “In Indonesia, when the budget is not high enough, doing development for a long period of time only provides downside for the producer,” they added.
Around August 2023, many industry professionals in the region became aware of Disney+’s plans to stop commissioning originals. We understand that Burbank bosses began to scale back the international spend around May, and in January 2024 the decision was made to cut the Indonesia-based team wholesale. Deadline also understands that Prime Video stopped greenlighting Southeast Asian originals at the end of 2023, a few weeks before an internal note from Prime Video VP, Asia Pacific, Gaurav Gandhi confirmed the change.
Several producers working in Southeast Asia said that Disney communicated the news of commissioning cutbacks to producers amiably. Amazon was more “transactional” in its tone, according to one producer impacted, though company insiders feel the process was handled fairly and correctly. Another producer working in Indonesia, who had several projects in development between Disney and Prime Video, said: “Disney knows how to do business here. They properly met with us, their partners, and explained the situation.”
We understand Disney’s local executives had two to three months of notice to gradually tie up loose ends and part ways (some got longer), while most Prime Video’s employees learned of their fate in an internal memo in January before meeting with managers and HR reps and exiting soon after.
Business resilience
While producers are redirecting their efforts toward re-packaging projects that were initially developed for Disney and Prime Video, we hear many were already building business resilience into their strategies from the beginning. Several had experienced similar cutbacks before with Asian streamer Iflix (later bought by Tencent Video) and the liquidation of Hooq (a joint venture between Warner Brothers, Sony Pictures and Singapore’s Singtel) in 2020.
“We knew that the streaming business, especially in Southeast Asia, is definitely volatile,” a producer based in Indonesia told Deadline, adding that streaming in the region had often been a “loss leader” for U.S. companies and was therefore an obvious place to cut back on spend if necessary.
At the recent Hong Kong International Film and TV Market (Filmart), there was chatter that international streamers had been surprised by the lack of production infrastructure in Southeast Asia, and in some cases had film execs working on TV slates, which didn’t help the situation.
Whatever in minutiae, everything changed when profitability become paramount.
“What started this whole thing is Netflix — back in Q1 2022 when they reported a huge loss of subscribers, everyone at that time was trying to ‘kill’ Netflix and went into the region,” said the Indonesia-based producer. “The objective at that point was about eyeballs, not profitability. They went to all these countries and then they were trying to play catch-up with Netflix, which had ten years of lead time. Then Wall Street said, ‘Forget eyeballs. We want our return on investment.’”
Lasting impact
Currently, producers are in talks to buy back the rights to their content with Disney and Prime Video, with several starting to re-package projects to pitch to other potential buyers. Many of these shows have cast members already signed and attached, and producers are eager for the projects to be greenlit for production soon while the packages are in place.
Deadline understands that Disney has offered several producers the option of buying back their content at the original cost — a generous move that waives the usual additional 10% of total cost for buybacks under traditional development contracts, as well as an extra 5% that accounts for inflation. This has worked well for the larger players in the region, who have regained their rights and are back out pitching those ideas. However, for smaller companies with less cashflow, the situation is more complicated. Many have had to move on, leaving their projects “on the digital shelf,” as one Singapore-based producer puts it. Some who had multiple projects in development with both Prime Video and Disney have chosen to buy back projects one by one, as they can’t pay upfront for all their projects.
One Singapore-based producer predicted a gradual reduction in production costs, in the wake of the U.S. streamers’ cutbacks in the region. Shortly after their arrival in Southeast Asia, this source became concerned after seeing production costs rocket upward, with talent and crew in the region gradually demanding “Netflix prices” for their work — a story we’ve heard versions of in other parts of the world. For example, local shows that might have previously cost around $100,000 per episode shot up to around $600,000 in a short time. Netflix didn’t comment.
“The costs look normal by American standards, or even Korean standards, but they are very expensive for Southeast Asia,” said the source. “As a producer, while it was great for everyone to be paid more, I was quietly nervous because I knew that this was not going to be sustainable.”
For a relatively nascent production sector, this would prove a problem. At Filmart, sources were opining that Southeast Asia needs to mature further, as the demands of producing the types of premium content streamers want have proven insurmountable at times.
However, there was also talk of prosperity returning in the future. As the costs of Korean production, in particular, rises in line with huge demand, local language Southeast Asian projects from the likes of Singapore, Indonesia, Malaysia, Thailand and Vietnam will eventually become more enticing, sources said.
‘The market’s getting smaller’
In the long run, this sounds like good news for the Southeast Asian market, but in the short term, it’s going to be tough out there. Indeed, a report from data analytics company AMPD showed the region had added only 1.3 million net subscribers in 2023 — the figure was more than 11 million the year before. Indeed, one former streaming exec said the situation is “all about snatching a piece of a shrinking pie,” adding: “Right now, the aim is to get stuff developed and to survive, and then see what happens in two years’ time. These things come in cycles.”
“The market is getting smaller and that’s the challenge,” they add. “It’s just Netflix now, or if not, we’re going back to the old days of cable and local arthouse stories.”
Some still see opportunity. Deepak Dhar, CEO of Banijay Asia and Endemol Shine India, claimed that the “changing landscape in the region plays to our strengths,” which was one of the reasons he hired former Disney+ content chief Kam-Engle to lead CreAsia Studio.
While CreAsia execs acknowledge the new-look market means focusing on development for the short-to-medium term, Dhar is bullish. “There’s an increasing openness to exploring new business models and frameworks, which allows for new dynamic partnerships and collaborations to evolve,” he said. “The growing interest from local players in co-productions opens doors to unique projects that can capture local and yet diverse audiences. Plus, we are strategically sourcing and acquiring content, which gives us an opportunity to bring globally successful formats and IPs to the region.”
CreAsia is different to many smaller production houses in that it has the power of the Banijay library — complete with the likes of Survivor, MasterChef and numerous scripted formats — behind it. “With strong local nous, and having built standout originals, developed international formats, and with access to the extensive Banijay catalogue for adaptations, we are in a unique position to service our clients across this expansive region,” said Dhar. “Some players may be stepping out the market for now, but there are still copious opportunities across the region with alternative partners to deliver premium storytelling.”
Another producer in Indonesia emphasized that without Prime Video and Disney commissioning in the region, there will be a chance for small- and mid-sized production companies to grow. “Now we don’t compete in numbers — we compete in quality,” the said. “Before this, numbers and volume were the major factors, with streamers trying to find studios that have that production capacity and making long-term deals with them. But now, with the fewer buyers, they’re looking for best quality content made by Indonesian producers.”
Returns to traditional rights arrangements are also likely as streaming originals become less prevalent. “We have to change our strategy back to the old days where we anchor the show in the primary market, and then sell piecemeal to the other markets, without one streamer buying global rights,” said one source.
The flip side to this risk reduction: Production companies might have less incentive to try out up-and-coming storytellers and push for riskier plots for future projects, as networks are broadly about attracting the biggest audiences, not the most engaged ones that streamers want. “Streaming gave us a cushion to take a risk,” said one producer based in Indonesia. “A lot of producers are saying now that with the streamers leaving is that we no longer have a second window or an alternative window.”
However, they added that one positive impact that streamers have had on the industry in Indonesia is the cultivation of higher standards. “They taught us compliance from the creative, editorial side, to business, legal and finance. It’s just a bummer that they didn’t last long because if they did, it would have become a norm in Indonesia,” they said.
“Right now, it’s up to us as producers. Do we now take the bull by its horns and run with it and keep refining the systems, or do we go back to where we were before?”
Zac Ntim contributed to this article.