Why It Matters: SK Square and CJ ENM are discussing merging their video-on-demand services, Wavve and TVING. South Korean media reported today.
This could change the landscape of streaming services in South Korea and enhance the competitiveness of the indigenous platforms against the likes of Netflix.
The Key Points
- The merger talks between SK Square and CJ ENM, initially initiated in 2020, have been rekindled, with an MOU expected to be finalized this month.
- The merger would bring together the CEOs of SK Telecom, SK Square, and CJ ENM to explore potential benefits, primarily focusing on content partnerships.
- Amid the challenging operating environment, Wavve and TVING reported losses of KRW 112.6 billion and KRW 11.91 billion, respectively, in the previous year.
- As of May, the combined active users of Wavve and TVING were over 9 million, suggesting that a unified platform could potentially challenge Netflix, which has a reported 11.53 million users in South Korea.
The Big Picture
This potential merger aligns with the Korea Communications Commission's advocacy for consolidating on-demand video streaming services to strengthen competitiveness.
According to an industry insider, this move could boost the reach of South Korean content overseas, enhancing the industry's competitiveness.
As the local market grapples with Netflix's deep pockets and vast scale, the proposed merger could signal a pivotal moment in the nation's media landscape.