Beat Netflix? 'Yes.' OTTs say. Consolidate? 'No!'
Domestic streaming-service providers and the government are on the same page in that they want to beat Netflix. But when it comes to how, there's little common ground.
The government wants the services to join forces, collaborate as much as they can to fight global video platforms. For service providers, the move is perceived as little more than surrender.
Streaming services that are available via the internet rather than through a subscription from an internet service provider or a cable channel are known as over-the-top (OTT) services in Korea.
Korea Communications Commission (KCC) Chairman Han Sang-hyuk sat down with representatives of four local platforms — Watcha, Wavve, CJ ENM’s Tving and KT’s Seezn — urging their cooperation.
“At this point, when foreign OTT platforms are establishing a strong presence in domestic market, cooperation among local companies is strongly needed,” said Han during the Tuesday meeting. “We should work together on a K-OTT that’s backed by strong support from the government.”
Another spokesperson for KCC added that a joint platform is needed to enter the overseas market, while emphasizing that the government office is not forcing "a merger among local platforms."
The four providers offer slightly different video content from each other, including films and series made by internal studios or sourced exclusively.
Local OTT platforms are not on board with consolidation.
Watcha is currently working hard to enter overseas markets, including Southeast Asia and Japan. According to Watcha, it has already received 10 takeover offers, all of which were rejected.
Tving is busy with its plan to set up a joint venture with JTBC. It is currently awaiting approval from the Fair Trade Commission.
“It’s not like we don’t agree with [the government’s idea] of cooperation among local OTT platforms,” a spokesperson for Tving said. “However, we have no time to think about it at the moment.”
Wavve agrees with Han as its priority is to stop Netflix in Korea.
“If necessary, local OTT companies should cooperate and build a joint platform before entering the overseas market,” said a spokesperson for Wavve.
Local OTT platforms are also not happy with the government’s tightened regulations. KCC Chairman Han last year said the government will possibly halt financial subsidies for OTT platforms.
“Although OTT has been playing a similar role as TV programs, they are not paying the Broadcasting Communications Development Fund,” Han said. “This is an issue of inequality that must be resolved.”
The Fair Trade Commission is currently reviewing the terms and conditions of OTT platforms regarding policies that disallow refunds to users in the middle of their subscription period. YouTube Premium paid 867 million won ($730,000) in fines for that practice earlier this year.
BY KIM JUNG-MIN [email@example.com]