Sidekicks Worried
The domestic mobile TV market is about see a fundamental change as OTT service provider Netflix makes its debut in Korea next year, while the bad blood between terrestrial broadcasters and pay TV service providers is still ongoing.
The mobile IPTV segment, which has led the growth of the market, is likely to lose its competitiveness due to the halt of the supply of terrestrial broadcasting content. According to industry sources, the mobile IPTV services of SK Broadband and LG U+ cannot provide any terrestrial broadcasting content after June 22. The same measure was taken on June 1 with regard to new subscribers. In the meantime, Kakao TV recently launched a service with terrestrial broadcasting content.
Experts point out that the conflict over payment for the content is inevitable in the current situation in which the mobile TV service in Korea is nothing but an auxiliary service for pay TV or a tool for attracting telecoms subscribers. “As of now, Korean OTT services cannot stand on their own legs as independent platforms because they are sidekicks,” said Sun Moon University professor Hwang Keun, adding, “Their position makes it difficult to pay more for content, which, in turn, leads to a conflict with terrestrial broadcasting channels going after the payment.”
Under the circumstances, Netflix is expected to partner with media businesses, including telecoms operators, in Korea. In fact, Netflix has already finished its media market research here and had talks with various media businesses as well as KT, SK Broadband, and LG U+.
“It is predicted that Netflix will hold hands with mobile carriers, guaranteeing a high Internet network quality instead of setting foot in the domestic market on its own,” the professor mentioned, continuing, “IPTV service providers are likely to welcome the content of Netflix, with VOD becoming less and less popular and the remuneration for terrestrial broadcasting content going up.”