|Fleur Pellerin, CEO of Korelya Capital and former French minister for culture and communication / Courtesy of Korelya Capital|
Indeed, the digital streaming industry generated $140 billion in revenue, up 35 percent year-on-year, disrupting traditional broadcasting channels thanks to the high quality of content and the affordability of these platforms.
U.S. platforms have acquired a massive head start over their competitors in terms of disruptive innovation, AI-driven customization and market positioning. But Korea, with the world's fastest average internet connection speed, has been a dynamic player in this industry, not only for its strong domestic demand but also for its ability to produce high-quality content that can reach a global audience.
Platforms are no threat to local content
The massive adoption of streaming platforms could have resulted in a standardization, a mainstreaming of content, or a "one-size-fits-all" approach at the expense of local creations. However, the development of streaming giants had the opposite effect.
It is worth recalling the artistic success of "Roma," a Netflix production that won the Golden Lion at the Venice Film Festival in 2018 and the Oscar for Best Director in 2019. In the same vein, Amazon Studios has been involved in the distribution of films such as Jim Jarmusch's "Paterson," Kenneth Lonergan's "Manchester by the Sea" or the Korean film "The Handmaiden."
In this new environment, public authorities are facing a major political challenge: ensuring the opening of audiovisual markets to transnational digital content makers on the one hand, and, on the other hand, involving the major online platforms in the financing and distribution of local audiovisual content.
Korea seems particularly successful in turning this challenge into a massive opportunity, both from an economic and smart power point of view.
'Hallyu' strategy has been success
As a former culture minister in a country with a strong legacy in cultural influence, I am fascinated by the way Seoul has strengthened its position as an Asian cultural hub for the past 30 years, evolving into a kind of local Los Angeles ― attracting actors, musicians, dancers, etc. from China and other Asian countries.
The city is now succeeding in giving birth to talent and content that have the power to influence the whole world. What is particularly striking is the acceleration and effectiveness of hallyu (the Korean wave) in the last 10 years.
To me, this hallyu strategy is based on a very clever mix: (1) a proactive governmental policy aiming at promoting the cultural and artistic industry abroad; (2) a completely innovative way to value the star system combined with a very dynamic "fan/idol" culture; and (3) substantial investments from chaebols. It is a perfect illustration of an effective alignment of private commercial strategy and public policy.
The success of hallyu is all the more remarkable in that, until the end of the 1980s, the Korean culture industry was still underdeveloped. Today, the country is among the five largest film industries in the world and K-pop is one of the most popular styles of music. Another striking fact, especially in the audiovisual dimension of hallyu, is that worldwide commercial success is not antithetic to quality and critical acclaim.
While series like "Squid Game" and "All of Us are Dead" were mainstream commercial products, the long features like "Parasite," "The Day After" and "Okja" also gained critical acclaim for their artistic ambition, and so will probably the two Korean movies selected for the 2022 Cannes Festival, "Decision to Leave" and "Broker."
I would like to stress one last comment. Usually, in France, we don't like to speak about business models when it comes to culture, as if an artistic gesture was, in essence, incompatible with the notion of profit.
However, in Korea, things are very different, and I observe with great interest the way creative industries have cracked a new business model with a long-tail value chain: A K-pop band can inspire a webtoon that will become very successful so that it will be published on paper and then turned into an equally successful series on a platform.
The series can then be adapted into a movie, and, why not, inspire a mobile game and marketing byproducts. The original intellectual property can thus generate very diverse revenue streams that will, in turn, feed the economic dynamism of the creative industry.
This virtuous circle is very impressive, and I admire Korea's unparalleled smart power catch-up. The Yoon Suk-yeol government will most certainly continue to ride on the success of hallyu by further supporting incentives for content production, Web3 and metaverse-related projects, and encouraging the export of Korean brands and intellectual property. To my foreign eyes, this is the time when the "han" culture of sorrow evolves into a culture of pride.
Fleur Pellerin started her career as a high civil servant with the French Court of Auditors. In 2012, she was appointed minister of SMEs, innovation and the digital economy where she launched the French Tech initiative. From 2014 to 2016, she was secretary for foreign trade and minister for culture and communication. She founded Korelya Capital in 2016 and serves as the CEO.