Native OTT 3 Companies Express Willingness to Participate in Digital Voucher Project
One-Time Nature Prevails... Industry Insider Says "Consider as Pilot Project"
Indirect Support Like Tax Credits and FAST Activation Alternatives Also Discussed
The government is reportedly considering a voucher program to increase access to online video services (OTT) for vulnerable groups. Three domestic OTT companies, including TVING, have expressed their willingness to participate if the voucher program materializes. As the burden of OTT subscription fees grows, leading to a digital content divide, the government is reviewing support measures, and with companies showing interest, the initiative is expected to gain momentum. However, voices are calling for supplementary measures such as the activation of ad-supported free streaming services (FAST) to ensure continuous content access.
According to industry sources on the 23rd, the Ministry of Science and ICT recently conducted a demand survey to assess whether technical support for a digital voucher support program is feasible. As a result, domestic OTTs such as TVING, Watcha, and Wavve have all expressed their intention to participate. The Ministry is considering this program as one way to improve digital content service accessibility for socially vulnerable groups.
The government's consideration of the voucher program stems from the recent consecutive price hikes by OTT companies, which have increased consumer burdens due to "streamflation" (a term combining streaming and inflation). TVING raised its premium plan price from 13,900 KRW to 17,000 KRW, and Disney Plus increased its monthly fee from 9,900 KRW to 13,900 KRW. Netflix has restricted new subscriptions to its cheaper Basic plan (9,500 KRW) and limited account sharing to non-household members, effectively amounting to a price increase. The government’s plan is to eliminate blind spots through voucher provision.
However, some concerns have been raised that the voucher program might be a one-off measure. It is uncertain whether OTT providers, which face significant deficits, will continue to participate even if the scope and duration of the program expand in the future. An OTT industry official stated, "We do not yet know the program’s funding, and we have only been asked by the Ministry of Science and ICT whether voucher support is technically feasible."
Experts advise that OTT welfare programs should be pursued with mid- to long-term goals. Kim Yong-hee, a specialist at Open Route, said, "The voucher program may vary depending on circumstances and budget," adding, "From an ESG (Environmental, Social, and Governance) perspective, indirect support methods such as tax credits to encourage companies to support vulnerable groups should also be considered."
FAST, which allows viewers to watch content for free by watching ads on smart TVs without a subscription fee, is also mentioned as an alternative. In the United States, FAST services are already thriving, operated by companies such as Amazon, Comcast, Paramount Global, and Roku, with over 65% of American adults owning smart TVs using FAST services. Although services like ‘Samsung TV Plus’ and ‘LG Channels’ exist domestically, progress has been slow. The Ministry of Science and ICT has also mentioned plans to establish a K-FAST alliance in its ‘2024 Major Policy Implementation Plan.’
Sung Dong-gyu, a professor in the Department of Media Studies at Chung-Ang University, said, "It seems to be a viable alternative to strengthen digital accessibility for vulnerable groups, but active investment is still insufficient," adding, "It should be viewed with a long-term perspective."
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