Netflix CEO Visits Korea, Meets with KT CEO Gu Hyun-mo... Interest in the Background

One-on-One Meeting with KT CEO Koo Hyun-mo
Secret Gathering... Meeting Details Also Kept Confidential

Reed Hastings Netflix CEO

[Asia Economy Reporter Cha Min-young] Reed Hastings, CEO of the global over-the-top (OTT) video streaming company Netflix, recently visited South Korea and reportedly had a private meeting with KT CEO Koo Hyun-mo. It is noted that among domestic telecom companies, only KT had a meeting with him, raising speculation about potential content partnerships.

A Netflix Korea representative stated on the 1st, "Reed Hastings, founder and co-CEO of Netflix, visited Seoul," adding, "Hastings spent time listening to customer feedback and meeting with Seoul office staff, and plans to engage with partners as well."

They further added, "Hastings met with KT CEO Koo Hyun-mo to discuss the continuous efforts between the two companies collaborating to provide customers with a better Netflix experience."

It is known that Hastings did not have official meetings with SK Broadband or LG Uplus. The meeting with CEO Koo was also held privately, and the details discussed during the meeting remain confidential.

There is growing interest in the background behind Hastings’ request to meet with CEO Koo. The primary speculation is that KT, which has recently diversified its content through Studio Genie, likely discussed content collaboration plans with Netflix. KT is expanding external partnerships centered around KT Studio Genie, its media and content control tower, including alliances with CJ ENM.

There is also speculation that this move is a measure to counter SK Broadband, which is currently involved in a legal dispute. The strategic meeting is seen in the context of the global attention on the dispute between telecom providers (ISPs) and content providers (CPs) over network usage fees. Netflix lost a lawsuit against SK Broadband regarding debt non-existence confirmation on June 1 last year and is currently appealing.

KT has been providing Netflix services through Olleh TV since August 2020 under an IPTV partnership with Netflix. After LG Uplus secured an early IPTV partnership with Netflix and saw benefits such as increased market share, KT followed suit with a delayed partnership.

Meanwhile, Netflix announced on the 23rd of last month (local time) plans to lay off an additional 300 employees to reduce costs. According to Bloomberg and other sources, Netflix stated in a press release, "While we continue significant business investments, we are adjusting our workforce due to rising costs amid slowing revenue growth." The layoffs primarily targeted employees in the United States and followed a previous reduction of 150 employees the month before.

Bloomberg reported that Netflix, facing a slowdown in subscriber growth, has undertaken additional layoffs to control spending. Netflix announced in April that its paid subscribers declined for the first time in 11 years. Following a decrease of 200,000 subscribers in the first quarter, it expects an additional loss of 2 million subscribers in the second quarter. In response, Netflix plans to implement various cost-cutting measures, including optimizing content spending and launching a lower-priced service with advertisements.