Korea gears up to take on Netflix by growing local streaming services

Television

Published: 28 Feb. 2024, 17:06

Korea gears up to take on Netflix by growing local streaming services

Executives of local streaming services pose for photos after signing a memorandum of understanding (MOU) with the Ministry of Culture Sports and Tourism and the Korea Creative Content Agency (Kocca) on Wednesday at the Museum of Modern and Contemporary Art (MMCA) Seoul in central Seoul. [MINISTRY OF CULTURE, SPORTS AND TOURISM]

It’s Netflix up against every other streaming platform around the world, and the Korean government is adamant on nurturing domestic services so they can become the new champion to compete with the long-reigning Goliath of the global streaming market.

The Ministry of Culture, Sports and Tourism and the Korea Creative Content Agency (Kocca) on Wednesday signed a memorandum of understanding (MOU) with five domestic streaming service operators — Tving, Wavve, LG U+, Coupang and Watcha — to help the local services expand into regions outside of Korea.

Culture Minister Yu In-chon was joined by Kocca director Jo Hyun-rae and chiefs of local streaming service operating companies at the signing event: Tving CEO Choi Ju-hui, Content Wavve CEO Lee Tae-hyun, senior vice president of LG U+’s infiniSTAR (the platform service management sector at the telecom company) Chung Hyun-joo, Coupang Play CEO Kim Sung-han and Watcha CEO Park Tae-hoon.

The three main agendas laid out in the MOU were to encourage major platforms’ cooperation with small- and medium-sized production companies, to help domestic streaming services expand their services overseas and to boost the services' barrier-free projects.

“We have been actively looking into ways to help domestic streaming services expand globally since late last year,” Culture Minister Yu said Wednesday in his welcoming remark.

Minister of Culture, Sports and Tourism Yu In-chon [MINISTRY OF CULTURE, SPORTS AND TOURISM]

“The ministry will soon kick off the fund of funds to develop the video content market. The amount of money may not be much, but we hope it acts to pump up the necessary energy for everyone working in the industry and revive the scene.”

The ministry promised to provide up to 3 billion won ($2.2 million) to original content projects that are provided to local streaming platforms, under the condition that the production companies and streaming services both share the copyright. The condition is meant to prevent another “Squid Game” (2021) conundrum, when Netflix took all the fruits of the success as the sole copyright holder and the production company was left hanging.

The ministry and Kocca will also help streaming services edit and remaster their content to meet the needs of overseas markets, such as adding subtitles and adapting to other local regulations. Barrier-free services such as sign language aides will also be supported, Minister Yu said.

Production companies and streaming platforms will also get to take part in overseas video content festivals, including in Hong Kong, France and Vietnam. One video content fair is scheduled to take place in August in Korea to connect local creators with foreign buyers.

Minister of Culture, Sports and Tourism Yu In-chon gives a welcoming remark to the press prior to signing a memorandum of understanding (MOU) with five local streaming services and the Korea Creative Content Agency (Kocca) on Wednesday at the Museum of Modern and Contemporary Art (MMCA) Seoul in central Seoul. [MINISTRY OF CULTURE, SPORTS AND TOURISM]

The MOU comes amid a global landscape long dominated by standing champion Netflix, including in Korea.

Netflix remains the champion of the global streaming market, with over 260 million subscribers around the world as of Dec. 31, 2023, according to Forbes. It is followed by Amazon Prime Video with 200 million subscribers, Disney+ with 150 million, Max with 95 million and Paramount+ with 63.4 million.

Coupang Play, Korea’s largest streaming platform as of December 2023, saw 6.6 million subscribers, followed by Tving’s 5.2 million, Wavve’s 4 million and Watcha’s 550,000. Disney+ had 3 million subscribers in Korea, according to market tracker Mobile Index.

One breakthrough has been through merging. KT’s Seezn and Tving merged in December 2022, and Wavve and Tving signed an MOU to merge the two services last December, though the details of the deal were still “under discussion,” according to the two companies.

“The broadcasting and video industry, including streaming services, is the essence of K-content,” Minister Yu said.

“The MOU signals a small but great step in that the Culture Ministry, Kocca and major streaming service companies have come together to pledge to grow together. The different interests surrounding intellectual properties [IPs] are complicated, but we will work to find a way for every party to grow together using IPs.”

BY YOON SO-YEON [yoon.soyeon@joongang.co.kr]