K-Content Hits Big… Netflix, Even as Korean Revenue Surpasses 1 Trillion Won, Sends 80 Billion Won to U.S. Headquarters [Star Issue]

*This content was translated by AI.View Original

Netflix’s revenue earned in Korea for the first time last year surpassed 1 trillion won. Approximately 80 billion won, accounting for 81% of total revenue, flowed to its U.S. headquarters.

According to NEWSIS on the 14th, Democratic Party of Korea lawmaker Han Jun-ho, a member of the National Assembly’s Science, Technology and Information Committee and the Korea Communications Commission, announced an analysis of Netflix Service Korea’s audit report.

The analysis showed that Netflix’s domestic revenue last year totaled 1 trillion 54.2 billion won. This represents an increase of approximately 1.7 times over four years from about 631.7 billion won in 2021.

According to the report, 853.9 billion won, equivalent to 81% of revenue, flowed to the U.S. headquarters as "consideration for subscription membership purchases." Consequently, the operating profit of Netflix Korea, the domestic subsidiary, was only 20.3 billion won, with an operating profit margin of just 1.9%. Due to a structure that sends massive fees overseas, both the subsidiary’s profits and tax revenues have decreased.

Amid this, domestic online video service (OTT) providers TVING recorded an operating loss of 69.8 billion won, and Wavve recorded an operating loss of 12.2 billion won, continuing their deficits.

Critics are pointing out that the dominance of the domestic OTT market is concentrating on Netflix, exacerbating imbalance, and there have been consistent calls for improvements to the revenue-sharing structure that returns profits to production companies supplying content to Netflix.

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*This content was translated by AI.View Original