A Conversation on Regional Language Content: Kocowa CEO KunHee Park (Part 4)

Sramana Mitra: How many consumers do you have currently?

KunHee Park: Five million. If I counted paid subscription, we have over one million.

Sramana Mitra: What’s the monthly subscription fee?

KunHee Park: $6.99.

Sramana Mitra: Do you have a sense of who is paying to subscribe to this? Is it mostly Korean speaking people?

KunHee Park: No.

Sramana Mitra: It’s not Korean households?

KunHee Park: No.

Sramana Mitra: What are the demographics?

KunHee Park: Three years ago, we did a survey that showed that about 90% of subscribers are non-Koreans, 30% are white Americans, and 30% are Asian and Hispanic.

Sramana Mitra: Why do they subscribe to this Korean language channel? What is the motivation?

KunHee Park: Even I had been perplexed. I don’t like drama, especially Korean drama. I always look at the statistics. I could see the user experience from KPop. KPop was very popular at that time.

Sramana Mitra: They’re subscribing primarily because of Korean music?

KunHee Park: It was in the very initial stages. KPop fans pay attention to KDrama.

Sramana Mitra: Korean soap operas are what draw people in.

KunHee Park: KPop stars are acting in the drama.

Sramana Mitra: These are TV series?

KunHee Park: Yes.

Sramana Mitra: I see. Interesting. Is there anything else that you want to share?

KunHee Park: The older streaming providers had trouble in acquiring premium titles. We have challenges. The global and US providers acquire titles. Netflix is number one. They started investing money in Korean content production in the last 10 years. Ten years ago, people thought that Netflix is doing something very weird.

If you look at the Asian market 10 years ago, Korean drama was number in Asia. The US market wasn’t aware of that. Netflix analyzes all the user traffic. They knew that Korean drama is one of the trigger points to deliver Netflix user experience to Asia. That is one of the competitions to acquire Korean content. If Netflix acquires all the content from the studio, the broadcasters can hardly get the IP.

I have to think about how to expand our content providers. That’s why we invented an open video platform strategy against Netflix’s closed platform strategy. Netflix offers exclusive titles. They never open data for the individual title performance. Many studios sell data content to Netflix, but very few titles are selected. I offer an open platform to our content providers. We open up all the statistics. Every content provider gets the revenue share and watching ratio.

We need to have a very clear statistics system. It was very challenging. In the beginning, I had to set a very clear data analytics platform. We did deliver such platform. The other challenge was the flexibility. We have to deliver all complicated business models in a short time for revenue recognition. I delivered very flexible backend system to meet all the business workflow.

We control over 400 workflows. If I have 10 business partners in the US market, I deliver three language subtitles. I hold over 30 content providers from Korea. Comcast is different. Amazon specification is different. If I consider all the business cases, workflow is over 400. Once I bring up the backend system to cater to workflow management system, we only have seven content managers operating 400 workflows at once.

I always calculate where we are in our specific product. Many platform companies lost money last year. They spent a lot of money for their growth.

Sramana Mitra: What do you think is the logical progression of your business? You think one of the streaming providers will buy you?

KunHee Park: It makes sense to me.

Sramana Mitra: That’s my hunch. There is interest in regional content. If you have been able to amass a significant amount of Korean content and there is this draw, it makes sense for one of those players to buy you.

Thank you for your time.

This segment is part 4 in the series : A Conversation on Regional Language Content: Kocowa CEO KunHee Park
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