[Featured Stock] Alois, OTT War Triggered by Disney Plus... Differentiation with World-Class Technology

[Asia Economy Reporter Park Hyungsoo] Alois, a developer of Android online video service (OTT) boxes, is seeing a strong rise in its stock price. The expectation of benefits from the global OTT market upheaval appears to be influencing the stock price.

As of 10:44 a.m. on the 7th, Alois is trading at 7,550 KRW, up 14.92% from the previous trading day.

Netflix recently saw a rapid increase in users due to the COVID-19 pandemic, reaching 203.66 million paid subscribers worldwide as of the end of last year. In South Korea, the number of users was estimated to have more than doubled in the past year, reaching 10 million as of the end of February (according to IGAWorks).

The strength of Disney Plus is also considerable. According to market research firm Ampere Analysis, the number of subscribers to Walt Disney's OTT services, including Disney Plus, Hulu, and ESPN Plus, is expected to surpass Netflix subscribers in 2024.

According to Grand View Research, global demand for OTT set-top boxes is projected to grow from 13.26 million units in 2018 at an average annual growth rate of 9.0%, reaching 23.84 million units by 2025. The market size is expected to grow from $1.68 billion in 2018 at an average annual growth rate of 8.8%, reaching $2.98 billion by 2025. Regionally, the Middle East and Latin America, where digital transformation and internet penetration rates are low, are expected to show high growth rates.

Demand for hybrid set-top boxes capable of satellite and OTT functions is also increasing alongside OTT growth. Markets such as the Middle East and North Africa, which have internet infrastructure but are relatively underdeveloped compared to other countries and mainly rely on satellite broadcasting, have high demand for relatively low-spec set-top boxes. Due to high oil prices and strong potential purchasing power, interest and demand for high-quality OTT set-top box products that add OTT functions to existing satellite functions are steadily increasing.

Alois’s hybrid product demand is also showing an increasing trend similar to OTT. Among Korean companies, Alois is the only one trading in open markets in the Middle East and Africa. According to Grand View Research, demand for hybrid set-top boxes is expected to grow from 4.89 million units in 2018 at an average annual growth rate of 9.9%, reaching 10.14 million units by 2025.

According to IHS Markit data, the global number of OTT subscribers is expected to increase from 410 million in 2017 to 650 million this year.

Alois has internalized its own Android OTT middleware client solution and is judged to possess world-class technology in this field. It is expanding sales in various regions worldwide. While competitors approach customers mainly through standardized specifications and basic functions with simple pricing and sales activities, Alois attempts differentiation starting from small parts and functions of the product through rich experience and accumulated top-level technology to approach demanders. Even among products of the same class, Alois’s products are understood to be evaluated as superior in added value within the market.