South Korean OTT services may face challenges by Netflix’s new pricing policy, local OTT industry officials claim
South Korean OTT platforms are concerned as Netflix plans to block shared accounts, potentially leading local users to abandon local services for Netflix. According to industry officials, Netflix’s ad-supported plan has driven up its user base in Korea, while local platforms have experienced declining numbers, posing a threat to their survival in the OTT market.
South Korean over-the-top (OTT) media service platforms are concerned about the impact of Netflix’s new pricing policy, which aims to block sharing accounts between acquaintances. Local OTT industry officials fear that if Netflix implements this policy, local OTT service users hesitant to subscribe may abandon local platforms and switch to Netflix. In April, Netflix had 11.73 million monthly active users (MAU) in South Korea, while local platforms such as TVING, Wavve, and Watcha experienced declines in their MAU.
Additionally, Netflix introduced an ad-supported plan in the South Korean market last year, which has resulted in a 2% increase in local users, while local platforms have experienced a decline. As the ad-supported plan gains popularity among local advertisers, Netflix is expected to generate an additional annual revenue of approximately 300 billion won in Korea. Local OTT industry officials noted that Netflix’s ad-supported plan and its new policy of blocking shared accounts pose significant challenges to the survival of local companies in the OTT market.
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