By Jasmine Kim
Hallyu content such as Korean dramas and K-pop are flowing into various parts of the world through a number of online platforms. In particular, OTT services, such as Netflix, play a strong role in the spread of Korean entertainment and media worldwide.
Netflix’s popularity has helped the Korean wave evolve beyond fandom culture to popular culture.
Netflix, which branched out into Korea in January 2016, is rapidly growing in size by investing in dramas where production was unable to start because it could not cross the threshold of cost or material. Korean drama producers are actively seeking opportunities to collaborate with Netflix in order to be able to work in an environment with complete financial support and take the advantage of displaying content to 200 million subscribers from 190 countries around the world.
After consultation, Netflix pays the production cost in advance to the production company, and the production company returns the remaining amount to Netflix after an audit of the production cost, Business Insider explains.
In addition, the restrictions on materials have disappeared, increasing the diversity of dramas. Korean channels often adopt popular materials because advertising is a major source of revenue. Therefore, it is difficult to find a production company that would support a drama with content that is too suggestive or provocative.
However, Netflix’s profits come from subscription fees paid by members, so the newness and completeness of the content are important because the subscriber is key, not the advertiser.
The fact that Netflix pays costs in advance does mean that a successful show profits the streaming service more than the creators of the show, however. While creators win acclaim, Netflix wins the capital.
Korea is the most important market for Netflix in Asia due to the great influence of Korean dramas in the Asian market. Netflix will invest over $500 million dollars in Korean content this year, according to Forbes.
Netflix needs to build as much content as possible to secure subscribers, and Korean dramas have increased the number of subscribers in Asia. In 2020, Netflix had over 25 million subscribers in Asia, according to Statista.
Films like “Okja” and “Parasite” directed by Bong Joon-ho helped strengthen Netflix’s subscriber rate as did popular dramas such as “Mr. Sunshine,” “Kingdom,” “Health Teacher Ahn Eun-young,” and “Sweet Home.”
There were also a great number of movies that were made with plans to premiere in theaters, but many were sent to Netflix as a result of the pandemic.
“Squid Game” is Netflix’s newest phenomenon, which recently caught worldwide attention. “Squid Game” became the first Korean content to set a record in ranking first in all 83 countries where Netflix is officially used as a streaming platform, according to the Mirror.
“Squid Game,” which deals with the problem of wealth inequality and the raw nature of humankind, aroused empathy from viewers all over the world. Netflix’s production cost for its nine-part series is known to be about 20 billion won – around 2.5 billion won per episode, according to Today Online.
Netflix has plans to release at least ten more Korean dramas following the success of “Squid Game” according to the Korean Herald.