Observing the recent success of the TV show Squid Game on Netflix, many commenters suggest that the entry of multinational streaming platforms has been a net positive for Korea’s creative industry. The streaming platform has invested over USD 700 million into projects such as Kingdom and Sweet Home. For smaller Korean content creators, Netflix offers opportunities that were previously hard to find, both creatively and financially. Collaboration with the platform has also proved greatly beneficial for Korean production companies specializing in sound or special effects.
However, critics have also raised concerns about the platform exploiting local content creators. While Netflix takes on the risk of producing smaller projects, they also recoup a disproportionate share of the profits, demanding the entire IP of shows they choose to invest in. For reference, while Netflix spent around USD 21 million on Squid Game, profits from increased subscribers and stock prices are estimated to be around USD 900 million. Creator Hwang Dong Hyuk confirmed that he was not paid anything more than what was outlined in the original contract despite this huge success.
While exports of Korean content such as k-pop, dramas, and webtoons did increase last year, multinational services like Netflix also profited immensely from Koreans who consumed more streaming content during the pandemic-induced stay-at-home mandate. Netflix is also in conflict with Korean broadband providers who claim that the company is not sufficiently compensating them for the growing internet traffic to its site. These trends point to growing dissatisfaction with Netflix’s unequal relationship with Korean creators, consumers, and the market.
Further compounding anxiety, content giants such as Disney+ and Apple TV are also throwing their hats into the ring. As tensions with multinational streaming platforms are expected to grow, experts urge South Korea to level the playing field by focusing on protecting the rights of Korean content creators.
This briefing comes from Korea View, a weekly newsletter published by the Korea Economic Institute. Korea View aims to cover developments that reveal trends on the Korean Peninsula but receive little attention in the United States. If you would like to sign up, please find the online form here.
Korea View was edited by Yong Kwon with the help of Janet Hong, Yubin Huh, and Mai Anna Pressley. Picture from the flickr account of Mathieu Velt