Pay TV Market in Indonesia: A Bright Outlook for 2023

The Pay TV subscription service sector is poised for remarkable growth in the vibrant landscape of Indonesia. According to the latest projections by GlobalData, the Pay TV service revenue in Indonesia is on an upward trajectory, set to surge at a CAGR of 4%. This surge will propel the revenue from $1.2 billion in 2022 to a robust $1.5 billion by 2027.

Diverse Growth Across Pay TV Segments

GlobalData’s Indonesia Pay TV Forecast anticipates growth across all Pay TV segments, particularly emphasizing the soaring number of IPTV accounts. This segment is expected to experience the swiftest CAGR of 9%. The driving forces behind this surge include the continuous enhancement of fixed broadband infrastructure in the country and the increasing adoption of multiplay packages that seamlessly integrate IPTV services.

DTH Services Maintain Dominance

Even as the overall share of Pay TV subscription accounts undergoes a gradual decline from 73% in 2022 to 68% in 2027, DTH services will remain the most widely used Pay TV subscription platform in the country throughout the forecast period.

Changing Dynamics of Monthly Spending

A Telecom Analyst at GlobalData highlights a fascinating shift in consumer behavior. He notes that the average monthly expenditure per Pay TV account is set to decrease from $4.66 to $4.17 between 2022 and 2027. This change is primarily attributed to competitive dynamics, as Pay TV operators employ promotional pricing strategies and offer discounts to fend off competition, especially from OTT subscription platforms, while retaining their subscriber base. 

 Challenges in the Industry: Navigating Piracy and Financial Hurdles

Piracy’s Pervasive Presence

Challenges loom large over the Indonesian media landscape, with piracy standing out as a formidable adversary for both traditional Pay TV and the emerging Over-The-Top Content (OCC) industry. The true extent of this menace is difficult to measure with accuracy, but estimates suggest that a staggering 6 to 12 million individuals indulge in unauthorized content consumption through cable TV, while a whopping 15 million resort to illegal online content streaming. This concerning trend is fueled by an increasing appetite among Indonesian viewers for pirated content, often accessed through illicit streaming devices (ISDs).

The government has initiated efforts to combat piracy, with the Ministry of Communication and Information Technology (Kominfo) leading the charge. To curb cable piracy, Kominfo has urged Local Content Owners (LCOs) to legitimize their operations by obtaining a cable Pay TV license. However, a critical missing piece in this puzzle is the absence of a robust enforcement mechanism to ensure that LCOs adhere to legal standards once they acquire their licenses.

Daunting Obstacles for Traditional Pay TV

Traditional Pay TV subscription platforms face a host of additional challenges, including escalating costs associated with content acquisition and network deployment. Simultaneously, these platforms grapple with the harsh reality of diminishing Average Revenue Per User (ARPU) figures, a trend exacerbated by declining subscriber numbers, particularly among DTH providers.

Monetization Woes for OCC Platforms

On the other side of the spectrum, OCC platforms confront the intricate challenge of monetizing their offerings. Indonesian consumers exhibit a marked reluctance to pay for content, a behavior that is further encouraged by the widespread availability of free content on pirate networks. Moreover, generating substantial advertising revenues proves to be a gradual and demanding process for OCC platforms, adding to their financial struggles.

Regulations: The Divergent Paths of Traditional Pay TV and OCC

Traditional Pay TV: A Realm of Stringent Regulation

The realm of traditional Pay TV in Indonesia operates under a robust regulation framework, particularly regarding content standards. These regulations encompass a range of elements, including content classification, parental controls, the mandatory dubbing or subtitling of film-related content into Bahasa Indonesia, and the allocation of a 10% quota for Indonesian Free-to-Air (FTA) content. Furthermore, local content requirements and advertising guidelines add layers of governance to this domain.

One noteworthy change in the regulatory landscape concerns foreign advertisements inserted into Pay TV channels. In recent years, there has been a discernible shift in this arena. It’s important to note that the current regulatory commission needs to accord adverts a top-tier priority, leading to less active monitoring of advertising practices within the traditional pay TV sector.

OCC: The Uncharted Territory of Non-Recognition

In stark contrast, the OCC industry remains lodged in uncharted territory due to its lack of legal recognition. Under the Broadcasting Law, only Pay TV subscription services delivered via satellite, cable, and terrestrial methods receive formal recognition. Consequently, content disseminated through OCC and alternative non-traditional Pay TV mediums remains exempt from the purview of regulations.

This divergence in regulatory treatment stresses the unique regulatory challenges faced by traditional Pay TV and OCC providers. While one adheres to a stringent framework, the other operates in a space largely untouched by formal regulation. The regulatory landscape in Indonesia, therefore, reflects the evolving dynamics of the media industry and the need for adaptable governance mechanisms to accommodate these changes.

The Way Ahead

Indonesia’s media industry encounters multifaceted challenges, with piracy posing a significant threat to both established Pay TV providers and emerging OCC platforms. Addressing these issues demands a cooperative effort from regulatory bodies, content creators, and industry stakeholders to ensure the sustainability and growth of the media ecosystem in the country.

Indonesia’s Pay TV market is experiencing a steady ascent, driven by diverse factors such as improved infrastructure and shifting consumer preferences. With promising growth across various segments, the landscape appears primed for continued expansion and innovation in the years ahead.


  • Mujammil Khan

    Mujammil has over 14 years’ experience in sales and marketing of ERP, CRM and BI services with the last 7 in broadcast and convergent media domains. He combines understanding of domestic and international markets and direct and indirect sales models with expertise in customer and partner life cycle management and key account management. His strong strategic planning and team management skills easily translate customer requirements into business solutions.