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Music & Entertainment

Netflix brings $4.7 bn economic impact to Korean industries: Deloitte

The global OTT service’s Korean investment has also helped create 16,000 jobs since 2016, it says

By Sep 29, 2021 (Gmt+09:00)

Netflix is the dominant OTT service provider in Korea
Netflix is the dominant OTT service provider in Korea

Netflix Inc. has contributed to a socio-economic impact worth 5.6 trillion won ($4.7 billion) across various South Korean industries through the joint work of the global streaming giant and Korean content providers, according to a consulting firm.

Deloitte Consulting Korea said on Wednesday, Netflix’s investment in content production in Korea has contributed almost 5.6 trillion won to the country’s economy across related fields from publishing to webtoons and consumer goods as well as helping create more than 16,000 jobs.

Since the over-the-top (OTT) service provider’s entry into the Korean market in 2016, Netflix's most immediate impact on the Korean creative ecosystem was felt in the content production and distribution business, it said.

The economic value Netflix has created through its partnerships with set designers, visual effects artists and production editors has so far reached about 2.7 trillion won, according to the Deloitte report.

Content made by Korean production companies has also created a spillover effect on the original intellectual property (IP) content industry, consumer goods and the tourism sector, it said.

Netflix and its Korean content partners
Netflix and its Korean content partners

According to a survey conducted by Deloitte and Netflix of 2,000 entertainment streaming service subscribers, about 42% of Netflix users have also read the webtoons, and web novels that were adapted into drama series and original content on Netflix and listened to the music used in the series.

For instance, songs and music aired on Itaewon Class and Crash Landing on You have ranked high on Japan’s Oricon albums chart, selling more than 60,000 albums in Japan alone.

Crash Landing On You, a Netflix drama, was the most viewed show on Netflix Japan in the summer of 2020.

RIPPLE EFFECT

Netflix said its investment in Korean content has also brought about 2.7 trillion won worth of ripple effects in other industries such as food, beauty and fashion.

Squid Game has topped the global Netflix chart, first Korean drama series to do so
Squid Game has topped the global Netflix chart, first Korean drama series to do so

Netflix had spent over 770 billion won ($680 million) producing 80 pieces of Korean original content such as TV series and movies for global audiences between 2016 and 2020.

This year alone, the OTT platform plans to invest about 550 billion won to produce Korean original content of various stories and genres.

The company's efforts have paid off, as Kingdom set off the K-zombie hype in the US and Europe, while Sweet Home has risen to third place in Netflix's global rankings.

More recently, Squid Game, Netflix’s new Korean survival game drama, topped the global Netflix chart right after its release in mid-September and is maintaining top positions in many major countries.

Netflix original drama Kingdom is a global hit, driving K-zombie hype across the globe
Netflix original drama Kingdom is a global hit, driving K-zombie hype across the globe

“Netflix watchers who saw the zombie series Kingdom or the monster horror show Sweet Home are also looking for things Korean such as the gat, the traditional Korean hat,” said Kang Dong-han, Netflix’s vice president of content for Korea, during the Netflix Partner Day online event on Wednesday.

“It’s amazing to see how the production of Korean content brings exciting changes to other related industries across the globe.”

Write to Han-Gyeol Seon at always@hankyung.com

In-Soo Nam edited this article.

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