HOOQ, a premium video-on-demand streaming service, is a joint venture between Warner Media, Sony and Singtel (Asia’s leading communications group). Sony and Warner Media provide a library and develop customized content while Singtel provides captive access to its mobile subscriber base in the Philippines, Thailand and Indonesia. The challenge HOOQ faced was much of their subscriber base would view content on mobile devices, which under current networks can take hours to download or have high latency, leading to a poor customer experience and lower customer acceptance. On March 27th 2020, HOOQ liquidated — an unfortunate consequence of their inability to address technological, market and data challenges. Netflix, Hulu, and other streaming services can use HOOQ as a case study to help improve their services and adopt some of the following strategies to increase growth and eliminate competition.
The roll-out of 5G technology will enable downloads in seconds and make streaming faster, making the consumer experience more enjoyable. Netflix should proactively partner with leading manufacturers of low-cost smartphones that can support 5G and ensure the ubiquitous distribution of these devices. This will lead to a better customer experience, and a faster pace, driven by operating on high quality, low latency networks and devices. This will also enhance returns on its library and content and promote mobile watching.
When considering markets with lower disposable income levels among consumers, longer-term subscription commitments are a major barrier to scale. Netflix should focus its marketing on “Sachet Products” which allow users to buy an “all you can watch” package for significantly shorter durations of 1 day, 3 day or 7 day packages. This would be a significant differentiator from competitors like Prime and Hulu which offer traditional monthly or annual options. Sachet packaging is perfect for family get togethers, big watch marathons, or to binge seasons of TV shows. Sachet packaging will apply to all users of Netflix and can be a huge source of revenue for the company.
Furthermore, investment in Data and Analytics capability to understand consumer preferences should have been at the core of HOOQ’s operating model to ensure sustainable advantage. This will help monitor and predict churn patterns of customers and proactively make offers with customised pricing and content, leading to higher retention rates. Though Netflix has a huge subscriber base already, seasonal promotions and offers would help them increase their ‘input into the funnel.’
HOOQ’s pursuit to be the dominant premium VOD service in Asia was cut short, but their falldown highlighted the problems that need to be addressed within the VOD industry globally.
Shiven is a freshman at the University of California, Berkeley aspiring to study Business and Economics. He has extensive experience as a sports journalist with international press credentials.