[K-Content Era] Ogam and BTS Soared Above Hollywood and Billboard Riding Global Distribution Networks

'Squid Game' Released Simultaneously in 190 Countries, Watched by 142 Million Households in One Month
Different from 2000s Hallyu Wave Limited to Regional Success in Japan and China
BTS Generates Global Fandom via YouTube, Entertainment Company Grows into 6 Trillion Won Conglomerate
'Squid Game' Producer Achieves Success and Awards Despite Unfairly Low Profit Margins

[Image source=Yonhap News]

'Squid Game' became the most-watched show in the United States within a week of its Netflix premiere. The number of global subscribers who enjoyed it over a month reached 142 million households. During this period, Netflix's market capitalization rose by nearly 25 trillion won. According to internal documents obtained by Bloomberg in October last year, the revenue generated by 'Squid Game' exceeded 900 million dollars (approximately 1.25 trillion won).

Netflix had previously enjoyed the benefits of K-content. With production costs less than a tenth of those for North American originals, it successfully established a foothold in the Asian market, proving to be a valuable asset. The achievements of 'Squid Game' far surpassed this. It showed overwhelming viewership in North America and Europe, sparking various social phenomena. Games like 'Mugunghwa Kkoci Pieot Seumnida' (Korean version of "Red Light, Green Light") became popular everywhere. Green tracksuits and dalgona candy sets sold like hotcakes.

The global success was influenced by the spread of COVID-19 and the widening wealth gap worldwide. Awareness of wealth inequality captured the hearts of global viewers. It is also the result of decades of accumulated efforts by creators. Lee Jung-jae won the Emmy Award for Outstanding Lead Actor and said, "Korea has many excellent contents besides 'Squid Game'." Creators have long borrowed or reinvented Hollywood content grammar. They prioritized universality and specialized in genre works. This contrasts with Japan, which sank beneath the surface by focusing on its unique regional traits such as intense violence.

[Image source=Yonhap News]

The Korean Wave accelerated in the 2000s. However, success remained regional due to individual contracts with Japan, Taiwan, China, and Southeast Asia. Global online video services (OTT) connected these markets into one. They greatly increased accessibility to overseas content by allowing viewers to enjoy it conveniently at any time. In the case of 'Squid Game,' it was simultaneously released in 190 countries worldwide through Netflix.

The distribution network is even fair. Content competes solely on its own merits from the same starting line. Popularity is entirely determined by viewers. This was impossible in theaters, where limited screens are allocated to multiple films based on power dynamics. In fact, director Bong Joon-ho's 'Parasite' never reached number one at the North American box office despite sweeping the Academy Awards.

BTS also achieved global success by relying on worldwide IT distribution networks. They cultivated a global fandom and expanded their influence through YouTube. Their number one spot on the Billboard charts was essentially a certification of this. All the profits went to their agency HYBE, which owns the music copyrights. It grew into a large corporation with a market capitalization exceeding 6 trillion won. In the past, it acquired the major American music label Ithaca Holdings, which was once unimaginable, and also built its own fandom platform called 'Weverse.'

[Image source=Yonhap News]

The situation of Siren Pictures, which produced 'Squid Game,' is quite different. Netflix pays a margin called a production fee at about 10-20% of the total production cost. For 'Squid Game,' this was about 3 billion won. Considering that the producer develops the product independently under an ODM (Original Design Manufacturer) model commissioned by the client, this is somewhat unfair. Apparel companies like Nike, which use an OEM (Original Equipment Manufacturer) model by providing designs and outsourcing production, offer manufacturers margins of about 30%.

However, it cannot be concluded that Siren Pictures sold the content at a loss. The 'Squid Game' script had been in the shadows for over 10 years. No domestic broadcaster was willing to invest. Netflix promised a certain profit while guaranteeing creative freedom. It is common for broadcasters or OTT companies to intervene in the creative process. Recently, director Lee Joo-young had a dispute with Coupang Play over unauthorized editing of 'Anna.' Some broadcasters also require producers to secure part of the investment themselves after providing partial funding.

Siren Pictures wiped away financial concerns with the global success of 'Squid Game.' It is reported that they were guaranteed profits incomparable to before for the production of the new season. Lee Jung-jae is also said to receive a fee corresponding to the highest rates in Hollywood. While this cannot change the production conditions of other works, winning six Emmy Awards?only English-language winners since 1949?promises another shift in the landscape. Award ceremonies are not just places to certify achievements but also to reflect on the era's significance of the works.

[Image source=Yonhap News]

The awards for 'Squid Game' indicate that Korea has become the world's second content powerhouse after Hollywood on a global scale. This foretells more investment and production. It is not just Netflix's story. Competitors like Disney+ and Apple TV+ are also offering generous terms to domestic production companies. All see Korea as a strategic business hub. Now that it has established itself as a major source of content pipelines, changes in the industry system are inevitable.