Astro partners China’s iQIYI to introduce online video app

• Partnership includes cross-sharing of content
• Astro to take lead in Malaysian marketing, customer acquisition

ASTRO Malaysia Holdings Bhd announced yesterday a partnership with China-based online entertainment service iQIYI, which will see the introduction of iQIYI’s first online video app outside China.

Astro will also take the lead in marketing, customer acquisition and media sales.

The iQIYI App will be available to all Malaysians on mobile devices (iOS and Android) as well as Apple TV. Users will be able to access iQIYI’s content for free, or subscribe to the VIP Gold or VIP Diamond memberships for ad-free exclusive content. The Gold and Diamond memberships price at US$3.12 (RM12.90) and US$5.77 (RM23.90) per month respectively, with the latter allowing for viewing via Apple TV.

Astro customers will get exclusive privileges, including a two-month free VIP membership and discounts should they choose to continue subscribing. It’s not stated how much the discounts will be, with discussions on the pricing still being in the pipeline.

“The exchanges and communications of global content have become more accessible with the help of wireless technology, data storage technology and big-data analytics. We hope to provide quality entertainment services to overseas users by sharing our research and development results, data storage capability and computing power with our partners,” says iQIYI’s Membership and Overseas Business Group president Yang Xianghua.

“With strong marketing capabilities, outstanding content creation and distribution strength, Astro has been a close partner of iQIYI. We share the same belief of providing users with high-quality entertainment experiences through technological innovation and content creativity. And we are confident that this close partnership will continue to fully synergise through the creativity and capabilities of both parties to provide users in Malaysia with better services.”

Mutual benefits

This collaboration with iQIYI is indicative of Astro’s strategy going forward, being a pay-TV provider in a world that is facing continuous disruptions from streaming services. iQIYI is, after all, China’s largest streaming company, with over 100 million paid subscribers.

It also follows a content partnership between both companies inked in June this year, which sees Astro holding exclusive rights to deliver iQIYI content on TV, On Demand and OTT in Malaysia. This includes an iQIYI branded channel comprising of the Chinese media company’s extensive slate of original content, from variety shows to serial dramas and movies.

“We believe this is the start of many more initiatives with iQIYI. The partnership is timely as we are seeing growing streaming services and interest as consumers are able to enjoy the rich content choices in a convenient and personalised manner,” says Astro chief executive officer Henry Tan.

“iQIYI is at the forefront of video streaming, offering both compelling content and a good user experience. In addition, we look forward to benefitting from iQIYI in data analytics and AI.”

Tan adds iQIYI’s model of providing both compelling content and good user experience fits Astro’s two main criteria when looking for streaming partners.

This partnership also allows for a cross-sharing of content for both media companies. While Astro has already been providing simulcast airings of iQIYI’s content, the announcement on Nov 6 includes content collaborations for three of Astro’s originals.

The Miss Astro Chinese International Pageant, Call Me Handsome show and the Why So Famous web drama will be featured on the iQIYI app, with Tan calling this collaboration as enabling Malaysian talents and content to be featured on a global stage.

On the other hand, Tan says that Astro presents itself in an attractive position for partnership with iQIYI. As Astro will be managing the marketing aspect, iQIYI essentially gets to tap into Astro’s existing customer base across its media brands in pay-TV, radio and digital content. At the same time, Astro can also provide readily-available end-to-end production capabilities, from talent management to studios.

Offensive or defensive

This app partnership announcement comes at a time of declining pay-TV subscribers for Astro over the past years. While the company’s 2Q20 core earnings of RM168 million were within expectations, according to AllianceDBS Research, Astro faces an uphill challenge with waning pay-TV interest and piracy.

Going forward, the company will continue seeking collaborations with streaming services from other parts of the world. Tan has said as much, adding that they’re in the process of discussion and evaluating other potential partners. “Those that meet the criteria we mentioned earlier, we’ll welcome them on board,” he says.

When asked if this partnership with iQIYI is part of an offensive or defensive strategy, Tan suggests that it’s both.

“We’re always on a journey of continuous improvement. That journey is now a lot faster, because the world is going through a lot of changes. So we’re ramping up the pace of change, and raising a lot of new things so we can bring the latest not just in terms of content, but in terms of technological enhancements for the betterment and benefit of our customers,” he says.

[Para edited for clarity.]

“It’s an ongoing process. As new things become available, we will make that available to our customers at large.”