South Korea's pop culture machine boosts Netflix's international growth -source

SK Telecom Co

20/10/2020 21:01

By Kenneth Li and Heekyong Yang
    NEW YORK/SEOUL Oct 20 (Reuters) - A zombie drama, a TV
series about a supernatural nurse and one about an antisocial
children's book author helped turn South Korea into one of
Netflix's biggest source of growth in the international markets,
a source familiar with the matter said. 
    Netflix said nearly half of its new paid customers outside
of America came from the Asia Pacific region, primarily Japan
and South Korea, the company reported in a letter to investors
on Tuesday.
    The source cited data that could be disclosed later this
week when a Netflix representative is expected to appear for
South Korea's annual parliamentary audit during which the
company's investment is likely to come up. It was not
immediately clear exactly what will be discussed at the meeting.
    The company is eager to demonstrate its big investments in
the region as well as its role in making Korean pop culture
popular more accessible outside of Korea.
    Netflix's South Korean business has played a major role in
third-quarter growth. The world's largest paid streaming video
service now serves 3.3 million paid members in the region as of
Sept. 30, the source said. 
    The company has helped fuel and is fueled by the global
popularity of the pop culture machine of South Korea. Since
2015, the world's largest subscription streaming video platform
has invested nearly $700 million financing partnerships and
co-productions, the source said.
    Since late 2019, it has ramped up investments and landed
multi-year content partnerships with Korea’s major studios
including CJ ENM/Studio Dragon and JTBC for access to their
Korean shows.
    More than 70 Korean-made shows from local creators have been
released as Netflix-branded originals around the world and are
available in 31 subtitled languages and more than 20 dubbed
languages.
    In October, Netflix released the original documentary "Black
Pink: Light Up the Sky" about the highest charted female Korean
act on the Billboard 100. The group's recent music video for
"How You Like That" broke an all-time YouTube record as the most
watched video in a 24-hour period with 86.3 million views.
    
    'NETFLIX LAW'
    South Korea in May passed the revision to the country's
telecommunications business act, dubbed as "Netflix law," to
require all content providers including foreign companies to
share network cost burden with local internet service providers.
    The revision came after Netflix in April sued South Korea's
internet network operator SK Broadband, an affiliate of the
country's top mobile carrier SK Telecom Co Ltd  017670.KS . 
    The two companies failed to reach an agreement on the U.S.
streaming giant's use of SK Broadband's internet service without
sharing network cost despite SK Broadband’s expansion of network
infrastructure to support Netflix’s increasing traffic.
    Netflix asked the Seoul Central District Court to rule that
it is not obligated to pay additional fee.

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 (Reporting by Kenneth Li in New York and Heekyong Yang in
Seoul; Editing by Lisa Shumaker)
 ((K.Li@thomsonreuters.com;))