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Korean streamers merge to better compete with Netflix, Disney+

Two of South Korea’s leading domestic streaming services, TVING and Seezn, have unveiled plans to merge, forming a single platform that’s better equipped to take on global rivals like Netflix, Amazon Prime Video and Disney+.

Powerhouse Korean entertainment company CJ ENM, which holds the controlling stake in TVING, confirmed the merger via a regulatory filing, indicating that its streaming subsidiary will absorb Seezn. The deal represents just the latest strategic move by CJ ENM to both beef up its position within the local Korean entertainment ecosystem and to grow into a more competitive global player.

The Seoul-based company bought a controlling position in Hollywood studio Endeavor Content late last year for $775 million. A recent partnership with Paramount saw Paramount+ launch atop TVING in June, as both companies seek greater scale to compete with incumbent streaming giants.

Seezn is controlled by KT Studio Genie, the content production arm of telecom operator KT Corp. Studio Genie said in a filing that the deal was reached to “strengthen the over-the-top (OTT) platform competitiveness within the domestic media and contents industry, and accelerate the growth of K-content.”

Additional financial terms were not disclosed.

TVING CEO Yang Ji-eul said in a statement that the company aims to become the world’s top Korean content platform by utilizing the “content production infrastructure and communication technology of both companies.”

“As the market competition becomes fiercer, insiders kept saying that local players need to get bigger in order to compete head-to-head with foreign platforms,” said culture critic Ha Jae-geun in a statement to local news service Yonhap. “TVING seems to be taking action, considering its recent moves to merge with Seezn and cooperate with Paramount+.”

Subscriber estimates in Korea tend to vary, but the most reliable assessments position Netflix at the head of the pack. As of the end of 2021, regional research group Media Partners Asia reported that there were a total of 14.1 million premium subscription video subscribers in Korea, with Netflix claiming a 33 percent share, or 4.7 million; local platform Wavve taking 19 percent (2.68 million); and TVING holding 18 percent (2.53 million). Disney+ is also thought to making headway, along other smaller local operators and the recently launched Apple TV+ (which has a smaller presence in Korea than elsewhere, thanks to the local dominance of Samsung).

TVING’s growing scale and assertiveness could present the keenest challenge to Netflix, which has cultivated an international reputation as destination for bankable Korean content. Following the global success of Squid Game, Netflix said in January that it would release 25 Korean originals just this year, easily surpassing the half-billion dollars it spent on Korean content in 2021.

CJ ENM was integral to Netflix’s early traction in the Korean content ecosystem, thanks to a 2019 partnership the streamer signed with CJ’s K-drama production company, Studio Dragon. The agreement brought hit K-drama titles like Crash Landing on You and It’s Okay Not to Be Okay to Netflix’s global subscribers. The partnership is set to expire this year.

Taking a page from the Hollywood studios’ recent playbook, CJ ENM looks increasingly intent on scaling its own platform and competitive position. In April, the group announced the launch of its third TV production studio, CJ ENM Studios, which will specialize in producing original Korean dramas. Other recent CJ acquisitions include deals for some of the country’s leading production banners, including Moho Film, the label founded by Park Chan-wook, winner of the best director award at the 2022 Cannes Film Festival; and JK Film, the company of filmmaker JK Youn, best known for domestic blockbusters like 2009’s Tidal Wave. The Hollywood Reporter

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