Global Platform Giants Are Coming... Disney+ and Spotify Set to Land in Korea

[Asia Economy Reporter Joeslgina] Following Disney Plus (+), which is mentioned as a rival to the global OTT giant Netflix, the world's largest music platform Spotify has also officially announced its entry into the Korean market. With world-class ICT infrastructure and the competitiveness of K-content, the Korean market has emerged as a battleground for global content platform giants.

◆Global Giants Officially Entering Korea

According to Spotify on the 19th, the company plans to launch its service in Korea in the first half of next year. Spotify is the world's largest music streaming service with over 60 million tracks and more than 4 billion playlists. Spotify explained, "Domestic users will be able to access artists and their music from around the world," adding, "Korean artists' creations will also be connected to Spotify's 320 million users worldwide." Spotify has been signaling its entry into the Korean market by establishing a Korean branch in Gangnam-gu, Seoul, in January.

The OTT giant Disney+ has also officially announced its entry into Korea. The Walt Disney Company appointed Luke Kang, former head of North Asia, as the Asia-Pacific regional president on the 17th, completing preparations to enter the Asian market, including Korea. Disney Plus will start services next year in Korea, Hong Kong, and Eastern Europe. Due to the surge in untact demand caused by the COVID-19 pandemic, Disney Plus surpassed 86 million paid subscribers within about a year of its launch, showing rapid growth.

◆Why Korea? Equipped with ICT Infrastructure and K-Content Competitiveness

The reason these platform giants have started stepping into the Korean market is a combination of world-class ICT infrastructure and the popularity of K-content. Although the Korean market itself is not large, it is judged that leveraging K-content can accelerate global market penetration. This is not unrelated to the evaluation that Netflix, which is building a content kingdom worldwide, owes much to Korea in becoming a streaming powerhouse with 200 million paid subscribers globally.

Earlier, 46% of Netflix's global net new paid subscribers in Q3 came from the Asia-Pacific region, including Korea. In particular, Korea has played a significant role in subscriber growth and is also a core production base for Netflix's original content strategy. Even when content production in major countries was halted due to the COVID-19 outbreak earlier this year, Korea was largely unaffected. This is why Netflix founder and CEO Reed Hastings has repeatedly expressed special affection for Korea in public.

An industry insider said, "Korea has established itself as a major market for domestic and foreign OTT companies," adding, "Disney+, considered a rival to Netflix, entering Korea was a predictable step." Especially in Korea, ICT infrastructure such as the world's first commercialization of 5G is well established, and purchasing power, including the proportion of paid subscribers, is evaluated as among the highest in the world.

Spotify is also paying attention to the rapid growth of the Korean music market, which is globally loved thanks to K-pop stars like BTS and BLACKPINK. Korea's music market ranks sixth in the world and has shown clear growth recently. Since Spotify first introduced the K-pop hub playlist in 2014, the share of K-pop listeners has increased by more than 2000%. Spotify emphasized, "Korea is a very important region for realizing the company's vision."

[Image source=Reuters Yonhap News]

◆Korea Becomes a Battleground for Global Platforms

As platform giants with massive capital make a full-scale landing in Korea, competition over domestic platform dominance in OTT and music streaming is expected to intensify.

Disney+ has strong content appealing to all age groups, from Marvel series like Avengers to Star Wars, attracting audiences from toddlers to seniors. A tectonic shift is inevitable in the domestic OTT market, currently led by Netflix and chased by native companies such as Wavve, TVING, Seezn, and Watcha. Disney+'s monthly subscription fee is about $6.99 (approximately 7,800 KRW), which is lower than Netflix's Korean base rate (9,500 KRW for the Basic plan), leading to speculation about a price war. Native OTTs, already lagging behind Netflix in capital and scale, will face even deeper survival challenges.

However, it has not yet been decided how Disney+ will enter the Korean market. If it enters directly like Netflix, the choice of partnership will be a point of interest. An industry insider said, "There is fierce behind-the-scenes competition among the three major telecom companies to attract Disney+."

In the domestic music market, platforms such as Melon, Genie Music, and Flo currently dominate. According to Mobile Index by IGAWorks, Melon ranks first in the number of music platform users. The industry expects that when Spotify enters Korea, it will not only distribute music but also play a role similar to Netflix by producing K-pop content and linking overseas distribution.

This content was produced with the assistance of AI translation services.