Global Media’s Inroads
Global media companies are accelerating their entry into the Korean market. They are not just investing in supplying images, but actively investing in Korean video production companies and entertainment companies, and actively moving to produce their own unique Korean contents.
Netflix already started investing in domestic movies and dramas, and Google has announced that it will produce original Korean contents by launching YouTube Red.
On December 6, YouTube announced that it will invest in Korean contents in earnest by releasing “Youtube Red,” a paid service that allows users to watch videos without watching advertisements on YouTube. YouTube is already preparing original contents utilizing the popular idol group Big Bang in partnership with YG Entertainment's. The contents will be available only via YouTube Red early next year. In addition, YouTube is building partnership with Iconic which created Pororo, a popular Korean animation character.
"YouTube is receiving good responses about its original contents from overseas and will provide original contents tailored to Korea in Korea," said Adam Smith, vice president of YouTube Product Management “First of all, original contents involving Big Bang are scheduled. We will increase original contents by cooperating with various partners. "
Netflix, which made a foray into Korea in January, is also significantly expanding its investment in Korean contents. The online film streaming company already invested a lot of money in Korean director Bong Jun-ho's new film “'Okja” and secured the right to the overseas distribution of the blockbuster 'Pandora' to be released on December 7. Netflix is increasing its interest in Korean contents such as streaming TV shows one day after they are broadcast by terrestrial broadcasting companies. Netflix is expected to take part in Korean drama production in the future.
"We are considering plans to produce Korean TV shows like ‘House of Cards’ in Korea," said Netflix CEO Reed Hastings who visited Korea in June. Like this, global companies are increasing their investment in the Korean content market as they will make Korea a base for advancing into the Asian region. K-Pop and Korean TV dramas popular in Asian countries such as China will attract not only Korean customers but other Asian customers.
While global companies are actively moving, Korean companies cannot begin to invest in contents due to regulations. It is important for companies to increase the number of their subscribers who will pay for contents before producing their own contents as YouTube or Netflix has done. SK Telecom and CJ Hello Vision were trying to grow their business through mergers and acquisitions, but their marriage plan was thwarted by the government’s regulations. "A company can invest in producing its own contents only if the company has at least ten million subscribers. In Korea, although KT is the number one company, it has about eight million subscribers," said a representative of the media industry. “Although some media companies are producing their own contents, the number of subscribers is small. This fact is hindering massive investment in producing contents."