(Bloomberg) — Warner Bros. Discovery Inc. is rolling out its Max streaming service in Asia this week with a contrarian strategy: Rather than investing billions of dollars in local content to attract new subscribers, it’s banking on its flow of big Hollywood movies and TV shows.
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The media and entertainment company is relying on established franchises like Harry Potter and Friends to draw viewers across the region, setting it apart from rivals Netflix Inc. and Walt Disney Co. Arriving in Asia after its peers, New York-based Warner Bros. is partnering with local platforms to efficiently build loyalty for its streaming content and increase subscribers without heavy initial investments.
“This is an area where we have an advantage in coming this late, because they’ve spent a lot of money and arguably maybe wasted a lot of money trying to compete with great local players that are producing great local stories,” JB Perrette, chief executive officer of global streaming and games at Warner Bros., said in an interview. “Our approach is very different from theirs.”
While Max is being rolled out aggressively on the world’s most populous continent, Warner Bros.’ rivals are redefining their priorities in the region after relatively slow growth compared with the size of their investments. Amazon.com Inc. has pulled out of Southeast Asia to focus on India and Japan. Disney has also cut spending in Southeast Asia, merging its operations in India with a local partner and shifting its investment in local content to Korean dramas and Japanese anime.
As others scale back, Netflix — the biggest subscription streaming platform — is pumping out original titles under its “local for local” mantra. The US streamers face competition on the ground from regional platforms, too, which have expanded ad-supported options and added live sports and unscripted shows.
Warner Bros. executives see the debut of Max in Asia as the biggest opportunity for subscriber growth. Average revenue per user in Asia will be lower than in the US or Europe, but the platform will help increase subscribers and ultimately boost advertising revenue, executives said.
“Given competition and budgets, their local content investment strategy has to be cautious and tactical near-term,” said Vivek Couto, executive director at Media Partners Asia, an industry consultant. By 2029, Max is expected to bring in more than $600 million in revenue a year from Japan, Australia, New Zealand and Southeast Asian markets, he said.
