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Iflix content chief does not believe in Netflix's pan-regional approach in Asia

? Iflix to commission 50 new titles in Malaysia, Indonesia and the Philippines by 2019.

? Company's content strategy focused on Malaysia, the Philippines and Indonesia.

? Scripted dramas and stand-up comedies take advantage of looser censorship guidelines while being cost-efficient.

In an increasingly crowded over-the-top space in Asia, regional player iflix Sdn. Bhd. is betting big on hyperlocal, original content. The Malaysia-headquartered company plans to quadruple its commissioning slate of originals with more than 50 new titles in 2019, which include 12 original TV series and 30 movies.

SNL ImageMark Francis, global director of original programming at iflix
Source: iflix

Iflix's global director of original programming, Mark Francis, told S&P Global Market Intelligence there is a gap in the Southeast Asian market to distribute localized programming, largely due to legacy issues plaguing pay TV broadcasters.

S&P Global Market Intelligence: Creating local content in the OTT market has become a popular strategy. How will iflix differentiate itself from its OTT rivals?

Mark Francis: Many players in the market, including Netflix Inc., are taking the pan-regional content approach, licensing top titles and focusing on big markets like Japan and India. I don't believe in that because if you get into the regional game it becomes a bidding contest. At the same time, we do not hedge heavily on Korean content like Viu. Going hyperlocal in three markets, Malaysia, the Philippines and Indonesia, from a content perspective, means that iflix will be filling a void where there is not much local content on offer. This is the mini "blue ocean" for us.

Why has iflix decided to home in on Malaysia, the Philippines and Indonesia?

Indonesia's domestic box office will see some 600 new screens over the next five years, which means people are willing to go to the cinema and watch local content. That is a great metric to indicate that local content is resonating. While in Malaysia, there is not enough local content so the demand is there while the supply is low. In the Philippines, there is a broadcasting duopoly; therefore, choice is needed. India is interesting but there are already many players.

What is the biggest challenge for the OTT industry in Asia?

I would say that it is a crowded space. The challenge is to understand we are in the attention and storytelling business, but we are also competing against a number of distractions in the mobile and digital age.

How will iflix battle against the traditional pay TV players that dominate those markets?

Local operators are often bogged down with either censorship issues or bureaucracy. As a result, young audiences do not have enough choice. We forget that OTT in Southeast Asia is what pay TV was in the U.S. back in the '80s. It gave Middle America premium content.

What kind of original content is needed for OTT players to stand out in Asia?

Other than being local in language, original content that can cover a wide range of subgenres, such as teen romance and action comedy, will do well. Scripted dramas and stand-up comedies can drive engagement as they can take advantage of looser censorship guidelines while being cost-efficient. Short-form videos are also a great way to increase stickiness and clickability.

How can OTT players looking to expand into short-form video compete with the likes of YouTube LLC?

There is certainly an audience for a range of short-form content that is localized and curated better than it currently is. For example, news can be aggregated in a far more creative and efficient manner than it is on YouTube.

The increased demand from the OTT industry for original and local content means a boost for local content producers. How do you select the right producers?

We tend to work with movie producers that have a solid track record in film and TV, rather than TV-only studios. The studios are also primarily based in Indonesia, Malaysia or the Philippines. We do not work with studios in, say, India or Singapore where they tend to display the technical skills required but do not have the network or partnerships to run something inside our three target markets.

Is iflix planning to expand its local, original content offering in the Middle East and Africa markets as well?

We were involved in a few co-productions in the Middle East in 2017 and in Kenya we did push out a series. However, these are not our priority markets right now.