CEO Park Jung-ho, "It's Time to Meet Netflix CEO"
Denies Possibility of Alliance with Disney Plus
Collaboration Likely with Amazon Prime, HBO Max, etc.
[Asia Economy Reporter Minyoung Cha] SK Telecom is igniting the overseas online video service (OTT) war among the three major telecom companies in the second half of the year. Park Jung-ho, CEO of SK Telecom, who led super-collaboration with overseas companies including Amazon, is expected to demonstrate his competitive spirit once again.
After a meeting with Minister Lim Hye-sook of the Ministry of Science and ICT on the 28th, Park Jung-ho told reporters, "Collaboration with HBO Max is becoming visible," adding, "We will talk about it gradually."
HBO Max, Warner Bros.' OTT, is a strong competitor comparable to Disney Plus and Apple TV Plus, which are about to enter the Korean market. It also holds intellectual property (IP) rights to famous dramas and movies such as 'Sex and the City,' 'Entourage,' 'Game of Thrones,' 'Friends,' and 'The Big Bang Theory.'
In the second half of this year, many overseas OTTs, led by Disney Plus and Apple TV Plus, are expected to launch services in Korea. KT and LG Uplus have been conducting behind-the-scenes negotiations since last year to attract Disney Plus, which is expected to enter the Korean market in September. Despite unfavorable negotiation conditions, telecom companies are putting their lives on the line to attract these services. This is because they have previously enjoyed a strong IPTV customer 'lock-in' effect by attracting Netflix.
SK Telecom has drawn a line regarding the possibility of an alliance with Disney Plus. After the regular shareholders' meeting in March, CEO Park told reporters, "Disney sees Wavve as a competitor." This effectively ruled out the possibility of collaboration with Disney Plus. From SK Telecom's perspective, alliances with Amazon Prime, Apple TV Plus, and HBO Max are urgent.
This is interpreted as choosing Disney Plus rivals such as Amazon Prime and HBO Max. In particular, if Amazon Prime enters the Korean market, SK Telecom is expected to play a bridgehead role. Due to last year's super-collaboration between SK Telecom and Amazon, various cooperation possibilities from distribution to media content are anticipated. When asked about the possibility of cooperation with Amazon OTT, CEO Park replied, "Of course, there will be."
The possibility of improving relations with Netflix, with which SK Telecom has been in dispute since 2015, is also open. Recently, SK Broadband won a lawsuit related to network usage fees against Netflix, leading to speculation that the two companies will soon sit at the negotiation table. On the 25th, the Seoul Central District Court Civil Division 20 dismissed Netflix's claim for confirmation of non-existence of debt against SK Broadband and rejected the remaining claims. Netflix's argument that it did not need to pay network usage fees despite excessive traffic was not recognized.
Regarding the impact of the lawsuit between Netflix and SK Broadband, CEO Park said, "The time to meet Reed Hastings, CEO of Netflix, is approaching." He added, "Korea is a big market for Netflix," and "Although there are talks that Korean profits have died, Asian content is important, and cooperation with Asia will be important."
As part of its 탈 (?, 탈 means 'escape' or 'departure') telecommunications strategy, SK Telecom has marked media and content strategies. In the first quarter of this year, media business division sales increased by 17.6% year-on-year due to IPTV business growth and the effect of the T-broad merger.
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