Rocking the Video Content Market, Netflix’s’Reason for Success’


Rocking the Video Content Market, Netflix’s’Reason for Success’

In the rapidly changing IT market, we are encountering numerous devices and services. Some of them make a difference in our lives beyond existing products or services.

In this regard, smart PC Love wants to pay attention to how and how these IT devices and services are loved by people. The main character of this brand story is Netflix’.

Netflix has Shaken the Movie Content Market

Netflix is ​​expanding its reach in the domestic media market at a frightening pace. Netflix’s mobile app domestic paid users were estimated at 900,000 as of September last year. Compared to 320,000 people in the same period last year, it has nearly tripled in one year.

Thanks to the popularity of the original drama kingdom’, which was released exclusively in Netflix, it is expected that the subscribers will exceed 1 million. LG U+, the only three carriers that have Netflix on IPTV, also revealed that subscribers have tripled since it aired in January last year.

Netflix is Referred to as Over the Top Online Video Service

Netflix is ​​referred to as a global online video service (Over the top, OTT) company focused on video streaming services. In OTT, top means a TV set-top box. As such, early OTT meant providing a cable or satellite broadcasting service through a set-top box.

However, with the development of broadband Internet and mobile communication, real-time streaming service began to be available. In line with this, the OTT service has been extended to various devices such as PCs and smartphones. Currently, the representative service of OTT is Netflix in the United States, and ‘poor’ in terrestrial broadcasters in Korea.

Netflix in Korea
▲ Netflix was an ordinary video rental business founded by Reid Hastings in 1997. Since then, it has successfully gone through the DVD rental business and is currently servicing online streaming.

▲ The zombie mystery thriller set in the Joseon Dynasty. The largest production cost (approximately 2 billion won per session) of Netflix original works outside the United States was invested. It is a six-part season, and Season 2 of 2020 will be released. Scenes that are difficult to see in the air such as amputation and sexual portrayal also appear as examples, which is possible in the Netflix era.

▲ With the rapid rise of Netflix, investments are actively being made in Movies to create native competitors against this. In the first half of this year, SK Telecom plans to take out corn, an online video service operated by subsidiary SK Broadband, and integrate it with Pooq, which is jointly operated by three terrestrial KBS, MBC, and SBS.

Easy and convenient to use various contents anytime, anywhere

Currently, Netflix boasts a total of more than 42 million videos. As of July 2017, subscribers using streaming are known to have surpassed 130 million worldwide, and 130 million as of 3Q 2018.

How many Subscribers Netflix Have?

Netflix, Subscribers are currently estimated at 130 million people in more than 190 countries. Many competitors such as Hulu’ (Walt Disney) and Amazon Prime Video‘ (Amazon) have sprung up, but it is true that Netflix is ​​the number one industry leader.

The driving force behind Netflix’s rapid growth comes from the way it operates. The most popular point is to escape from the spatial limit. If you pay Netflix for about 10,000 won a month, you can play videos on PC, smartphone, tablet PC, and even TV.

If you watch on a TV and go out and connect to the application with a smartphone, you can continue from the part you saw inside. There are no intermediary advertisements that interrupt the flow, and there is no broadcaster logo at the top of the screen that interferes with concentration due to extortion.

High degree of freedom is also considered an advantage. In the case of a traditional TV, the content was broadcast at a fixed time according to the schedule of each broadcaster, so it was possible to watch the desired content without waiting.

However, it is possible for Netflix users to view the content they want to see in real time anytime, anywhere. After seeing JTBC’s , you can watch tvN’s and then watch the movie directly on Netflix.

Since it is a streaming method, there is no need to wait a long time to download content. In the case of content with a storage function, you can also enjoy viewing offline.

Netflix Available Devices
▲ Supported devices are the most among OTT services, including PCs (Windows and Mac OS) and smartphones/tablets (except Android, iOS, Windows Phone, but depending on OS and model), as well as Smart TV, Blu-ray player, Chrome It supports a wide variety of platforms such as cast, Apple TV, game consoles (PS3, PS4, XB360, XB1, etc.) and various set-top boxes. The only cable TV/IPTV set-top boxes that officially support Netflix in Korea are D-Live, CJ Hello TV, and U+TV.

▲ Korea Netflix membership is divided into basic (9,500 won), standard (12,500 won), premium) 14,500 won). The higher the price, the more image quality (HD, UHD) supported, and the number of people who can connect simultaneously also increases up to 4 people.

Also Read: Why Youtube is so Slow

▲ LG U+ has been the only domestic telecommunications company to have a partnership with Netflix since last November. For this reason, LG U+ users can run the Netflix app on the IPTV set-top box and use a dedicated rate system.

▲ Netflix supports up to 4 simultaneous connections (depending on the rate plan). Accordingly, in recent years, a platform in the form of a step-by-step group has been created to share premium accounts among users. The representative place is ‘4FLIX’. In this case, the most used membership price is 14,500 won per month. If you share this membership that allows simultaneous access of up to 4 devices with 3 other people, you will be able to use all Netflix services for 3,600 won per month per person.

Paid profit model and curation success

Exclusive content called’NetPlus Original’ helped to boost the influx of users. If YouTube is a large wholesaler with products from various sellers, Netflix is ​​like a large mat with its own branded product (original series) in addition to the regular one.

What is Netflix Orignal Content?

Netflix Original is content that Netflix releases exclusively, instead of investing money in content production. There is also a wide selection of types such as dramas, comedies, movies, and documentaries. In the case of drama, all episodes of one season are released all day long, which reflects that viewers’ preferences are higher by streaming rather than waiting every week.

When was the First Netflix Orignal Series Released?

Netflix’s first original series was the drama released in 2012. Afterward, various dramas including, which won the 2013 Emmy Award 3 crowns, and became a great success, received favorable reviews and succeeded in significantly increasing the number of paid users. After that, as the market gradually increased in influence, Netflix began to expand the original series steadily by investing generously.

One of the impressive things Netflix is ​​pursuing is that it introduced the customer-customized production method’ using big data. A representative example is the mentioned above, and it is said that Netflix decided on the overall concept, direction, actor, etc. by analyzing big data such as video playback records, evaluation, and search information of users before making it.

Controversy over-communication network free ride

▲ In January, SK Broadband and Facebook reached an agreement on net royalties that had been attracted for about two years, but the details such as the length of the contract and the scale of the network royalties were confidential.

Recently, in the domestic industry, Netflix is ​​the first problem to be solved. Unlike domestic companies such as Naver and Kakao, which charge for usage depending on the traffic capacity, Netflix is ​​not currently paying for the use of communication networks in Korea.

The network fee is the money that online content companies pay for using the communication network laid down by the carrier. For example, in the case of Netflix, where the server is located abroad, users are connected to and streamed through the international network.

But what if the user becomes overweight? Naturally, the speed and image quality of content will drop sharply due to the traffic. Indeed, after the release of on January 25, when users streaming to Netflix ran out, SK Telecom and KT without Netflix’s dedicated cachers were sweating due to user protests related to service delays.

Carriers sensitive to communication quality have no choice but to make various investments, such as expanding international lines. So, they are making money through the nets they have laid down, and they have consistently insisted on paying a nominal fee to support the investment. In particular, in the case of Netflix, there are many cases in which ultra-high definition video such as UHD is transmitted through streaming, and traffic may be related to a surge.

As a result, one of the overseas companies,’Facebook’, agreed to SK Telecom and settled a deal. However, Netflix and YouTube are still sticking with their stance.

Where is Netflix Headquartered?

In addition, Netflix is ​​headquartered in the United States, so it is unlikely that it will be able to hit directly with government sanctions. Even though we are receiving network usage fees from our subscribers, the public opinion of’double-entry department’ is one of the challenges that we impose on content providers at the same time.