Still, former staff and Glassdoor reviews do note that Iflix had quality talent—and that the ride was a learning experience.
“If you can roll with extreme amounts of fast-paced change then the opportunities to grow are unparalleled,” Glassdoor says as its top ‘pro’ for working at Iflix.
While the decision-making is questionable, the need for fast-paced change was clear, and it is evident in the Iflix service today. What started out as Netflix-like service offering monthly subscriptions for a mixture of Hollywood and local content, is today a service that’s principally focused on local programming and supported by advertising and subscriptions.
How Iflix’s Growth Strategy Perpetuates a Culture of Telecom Monopolies in Emerging Countries
The change of focus on both what is shown and how it is paid for is critical as Iflix needed to distinguish itself from Netflix. When Iflix started out, Netflix operated in predominantly Western markets. But, less than a year later, it flipped the switch and expanded into an additional 130 markets—streaming to the entire world, barring North Korea, Syria, the Crimea and China—at a January 2016 press conference held during high-profile tech event CES, the Consumer Electronics Show, in Las Vegas.
That instantly changed the competitive landscape and, while smaller, local rivals the world over initially heralded the Netflix expansion as a validation of their strategies, it was the start of a move to advertising-based models.
The Netflix problem
Initially, Iflix and HOOQ insisted their target user bases were local emerging market consumers who didn’t overlap with Netflix’s subscriber base since those people had neither the spare capital nor the taste in entertainment to want the US service. While that may have been true, both companies subsequently realised that their audiences were harder to monetise than expected.
It wasn’t just about money, although the low rate of credit and debit card penetration in Southeast Asia coupled with the absence of a stand-out mobile wallet made that hard. Both companies struck deals with telcos who could help with distribution and payment collection through carrier billing agreements. Still, consumers, it seemed, were reluctant to pay for content when they had grown up on a diet of free-to-watch services like YouTube.
In many ways, that is the core dilemma at hand. Free services dominate the mass market and those seeking a higher quality experience are naturally drawn to Netflix, which single-handedly pioneered the concept of online streaming and has a budget far larger than its localised rivals. Netflix raised $2.2 billion via a debt offering in April—taking its total long-term debt to $12 billion—with content buying and development a key focus. Its purview may be global, but no local player in Southeast Asia gets close to even a fraction of that figure–and they must contend with Netflix developing its own original content for Southeast Asia, too.
Thus the advertising-led model became a focus. For Iflix, the model also helped with more favourable metrics because ad-based content generated more eyeballs, and those numbers were more likely to impress investors, a former employee said.