Farewell living rooms as TV migrates to mobile

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Farewell living rooms as TV migrates to mobile

Kim Eun-jung, a 29-year-old saleswoman, whiles away her daily commute watching video clips on the Internet via her smartphone. Youtube and Naver TVcast are her favorite apps. Kim either watches new videos from subscribed channels on Youtube or the web reality show about the casting of the male Idol group “EXO,” which can only be viewed on Naver TVCast.

“I often use my smartphone to watch TV,” she said. “After I changed to an unlimited data plan, there is no need to worry about data charges.”

An increasing number of people in Korea now turn to their smartphones to watch TV. And all three mobile service providers have special services to enable customers to do so. SK telecom has B tv Mobile, KT has Olleh TV Mobile and LG U+ offers U+HDTV.

The number of people who signed up for membership in the three mobile service providers’ TV services has reached 5 million.

Including users of the other cellphone content services such as Tving by CJ HelloVision and Hoppin by SK Planet, the number of subscribers of Mobile TV services is estimated to be more than 6 million.

The video streaming market has taken off ever since all three mobile service providers announced in May cheap data plans, which makes use of Internet Protocol Television (IPTV), a system for digital television services through the Internet network, less prohibitively priced.

“Customers who subscribed to a data plan that costs more than 50,000 won ($44.92) are sometimes willing to pay additional fees for some exclusive content as well, so it makes sense for mobile service providers to attract those subscribers,” said a spokesperson of a service provider.

With the growth in the mobile TV industry, the three major broadcasting companies - KBS, MBC and SBS - are demanding mobile service providers to raise fees for watching their programs with smartphones from 1,900 won to 3,900 won per month.

But the companies and providers have yet to reach an agreement on the charges. After failed negotiations, the major broadcasters refused to provide their content to mobile service providers starting in June.

“The domestic mobile content market is still smaller than overseas, and the worse part is that the three broadcasting companies are holding the market hostage, which makes it hard for service providers to grow,” said Lee Eun-min, a researcher at the Korea Information Society Development Institute.

Nonetheless, the growing content market is a great new opportunity for domestic IT enterprises such as Naver and Daum Kakao, etc.

Daum Kakao TV is preparing to launch Kakao TV in June. Whereas Daum tvPot is a web-based service, Kakao TV is a mobile phone-based service.

The three major broadcasters, after turning their backs on the telecommunication companies, said they would instead provide their content to Kakao TV, attracted to its KakaoTalk service, which already has 37 million current users.

Naver is joining the competition by launching Play League later this year, an online platform that enables people to easily upload and share video clips.

Recently, Naver spiffed up the video section on its homepage and added experimental content such as animations and dramas. Last November, Naver signed a contract with the three major broadcasting companies and JTBC in which the companies will provide video clips of their popular programs to Naver.

What the broadcasting companies are aiming at through the contract with Naver is attracting advertising to their content.

The world’s biggest video-streaming platform, YouTube, is making a similar move. YouTube announced last month that it was boosting the effectiveness of advertisements on its Web site by adding a button dubbed “Click-to-Shop.”

“Even if the number of platforms [such as YouTube] increases, consumers will only use a few handy services so they can easily access their favorite content,” Lee, the researcher from the Korea Information Society Development Institute, said. “This isn’t an easy market for domestic enterprises, where the market is smaller than overseas.”


BY PARK SU-RYON [ebusiness@joongang.co.kr]
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