If your view of the media business is centered on news sources about Europe and North America – and that would not be surprising, since their large media markets dominate much of the discussion – then you are likely to believe that advertising is no longer providing adequate revenue to sustain media, and that increasing subscription revenue is the only way to future sustainability.

This view tends to dominate international discussions about the business models that will support the future of digital news businesses. It is almost as if the industry has conceded the advertising market to Google and Facebook, and instead is pursuing compensation from the platforms that built their businesses partly on the back of media content. The common belief seems to be that getting readers to pay for access is the most promising news media model of the future.

But this approach simply isn’t an option for countries with much of the world’s population: Indonesia, and to some extent China and India. For the most part, getting people to pay for online news doesn’t work.

“The reason is, the type of content being spread in Indonesia is free content, so it is very hard if you do subscription and put up a paywall,” said Winston Utomo, Founder and CEO of IDN Media, the leading media platform company for Millennials and Generation Z in Indonesia, with over 70 million monthly active users.

“And the second is the payment method. For subscriptions, you need credit cards to make recurring payments. Indonesia does not have that, we have mobile wallets. People can do one-time payments, micropayments. So we should see Indonesia more similar to China, or India, rather than the United States.”

While their counterparts in Europe and North America focus on building subscription strategies, many Asian companies continue to focus on advertising revenue, despite the looming presence of the advertising behemoths Google and Facebook.

IDN Media is a prime example: it started in Utomo’s bedroom as a hobby while he was working at Google. Like a lot of people, he got into it because he likes content and media. There was an audience for what he had to say.

From that humble beginning, Winston and his brother William launched IDN Media in 2014. Today, it is a media platform company employing more than 600 people, reaching tens of millions across Indonesia, with double-digit growth in revenue and profitable over three straight years, even in the midst of a pandemic. It provides not only a wide variety of compelling content, but marketing and support for the advertisers who are not only attracted by that massive audience but by those services themselves. The Utomos make it easy to advertise with IDN.

IDN provides many digital media, with their own branding, theme, and content tied together in a single platform called IDN App: news and entertainment, fashion and beauty, parenting, competitive online multiplayer electronic sports (esports), cooking, and any other topics whose audience sufficiently attracts advertisers and sponsors. Most importantly, in addition to the marketing and support services, it provides other services for those advertisers that many global media companies cannot, such as ensuring that advertisements are not placed next to disinformation or hateful content.

But it is more than just an entertainment company; its mission is nothing less than “to democratize information for every Indonesian, from Aceh to Papua, and to bring positive impacts to the society”.

“Ninety percent of media content on the internet is about Jakarta,” said Utomo. “So, for example, if there is an accident in Jakarta, it becomes national news. But if there is an accident outside of Jakarta, almost no one knows about it.”

This is much more than just a question of regional domination, Utomo said. It has an enormous economic impact.

“For a country to become a high-income and first-world country, we need to bridge the information gap that is happening in Indonesia,” he said. “It is impossible to grow a country where only people in Jakarta and other few cities are educated and well informed. We need everyone in Indonesia to understand, to have the context, to be well-equipped with the right information. So that is why our mission, in IDN Media, is to democratize information. Access to quality information is a basic human right for everyone in Indonesia.”

“To make it simple, we are a one-stop media platform company,” Utomo explained. “We have news and entertainment, we have fashion and beauty, parenting, esports. We produce movies for cinema, we also license content, we have out-of-home (outdoor) advertising, and many other media as well. All under the IDN brand and technology. All in one single ecosystem, so this connects all the users in our ecosystem, and everything is plugged into our advertising system because we generate revenue from advertising.”

The key is to have a different and unique business strategy that responds to the core problems of the users. IDN provides an Indonesian version of a content aggregation platform, with the local content provided by the company and its users themselves.

For example, its flagship platform, IDN Times, is what Utomo calls “an Uber for writers,” where anyone can submit stories. The site has tens of thousands of active community members, with them generating more than 10,000 articles a month.

“In the short term, we have to explore offerings that are unique and other companies do not have,” Utomo said. “Like, for example, combining out of home (outdoor) and creative marketing platforms with our other businesses. That kind of business, many other companies will not enter. We provide a 360 solution, so anything the client needs, we can provide it. They try to coexist with the global Internet companies, while still getting a good share of the pie.”

“That is the short-term solution. But the long-term solution, which is what we are building right now, we have to create a super app for content, a one-stop media platform for all types of content. That’s the only way we can grow and become a major player, and be more sustainable.”

But if history is a guide, Google and Facebook are adept at recognizing the success of others, seizing opportunities, and creating new products and services that directly compete with the upstarts. Utomo believes there are limits to this strategy, and is betting IDN can continue to differentiate itself and attract advertising revenues.

“In the end, in many countries, especially in a growing country where the government is very ambitious, there will always be local players. That’s what I always believe. It’s healthy for the users, for the advertisers, for the ecosystem, and for everyone,” he said.

“I know it is very ambitious, but we are working on it right now. We believe that we can make it happen for the future of our beloved country, Indonesia,”he said.

To make the vision happen, IDN has been working hard to grow its ecosystem. IDN’s approach to developing new content is systematic and relies on three criteria.

“The first is, how big is the audience? If it is a small audience market, we do not want to enter. Let’s say, gardening. Yes, it has an audience, but for us, it isn’t big enough. That’s why we launched esports. Because it is a big market in Indonesia, a big user base. So the first factor is the number of potential users.”

“The second is the potential advertising revenue for the specific vertical. If the revenue is small, we don’t want to enter. We want to enter where it is sustainable to generate revenue from advertisers.”

“And the third is the competitive landscape. Is there any other player in the market? If there is, or there are too many players, we do not want to enter. For example, soccer. Because so many media have soccer categories, we don’t want to enter, even if it is a big market. So we enter other things. In esports, we are number one. Fashion and beauty, we are number one. Parenting, we are number one. So we want to enter the market where it is big, and we have a high chance of becoming number one.”

While content is still king, user experience is also a key component of success. IDN’s App offers a wide variety of personalization and usage incentives that keep the audience coming back and staying on the platform. “We still rely on Facebook and Google, don’t get me wrong. Facebook and Google are amazing platforms and partners. We really appreciate working with them. However, we try to balance the traffic referral and focus on the organic growth,” Utomo said.

For media companies wanting to follow his lead, Utomo had this to say: “For a company to be sustainable, for a company to be big and sustainable, we should focus on two things: content creation and also content distribution, and ultimately, to create a one-stop platform.”

“Pay equally important attention to content distribution compared to content creation,” he said. “I feel that many media companies focus too much on content creation, but they forget content distribution. They make very good content, but they do not put sufficient attention on content distribution.”

“For me, the best way that media companies can grow and sustain is to control content creation and content distribution. Twenty years ago, TV was the go-to media. If you look at the core competency, they control the content creation part, but they also control the distribution part, through the air rights they buy through the government. It’s very powerful. But now, everyone can say, oh, I have a media company. But when we look at the value chain, they only focus on content creation. They focus only on this thing. But media should not only be about content creation, media should also be content distribution. So I think that’s the main difference in the definition of media now compared to twenty years ago.”

This article is republished from the UNESCO publication After the pandemic, building back a stronger media: inspiring initiatives in ensuring media viability, written by Larry Kilman. Access it here.

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