[Economic ecosystem for subscribers] If you stop providing content, subscribers will disappear.Enter

Genie Music (043610), a music streaming service, announced a new leap forward as an audio platform company when it recently launched its 'Story G' service. It has declared that it is a professional audio service company that provides various audio contents such as audio books, audio entertainment, and audio dramas to existing music streaming services. Genie Music has transformed into an integrated audio content subscription service company in a month since it acquired the e-book subscription service platform "Milli's Study." With Genie Music's acquisition of Millie's study, customers can now enjoy various audio contents as well as sound sources within one platform.

Subscription service companies such as Genie Music are betting on securing content. This is because of the sense of crisis that subscribers disappear when content provision is stopped. In particular, while overseas subscription economy companies such as Netflix and Disney Plus are pushing into the domestic market with strong content, competition for content securing by domestic subscription business companies is expected to intensify.

According to Bank Salad, a company specializing in MyData on the 31st, a comparative analysis of digital content payment data for the first half of 2019 and 2021, showed that the average expenditure of all users rose sharply to 18,343 won, up 3.4 times. Digital content includes payment details of apps or platforms that provide music, books, and video services such as Melon, YouTube, Netflix, and Millie's study. Along with the growth of mobile platforms, the consumption of diversified digital content has increased significantly. However, platforms that seek for content consumption are becoming more and more concentrated. This is because customers are always turning to specific platforms that supply various high-quality content and provide new experiences.

According to the "Content Trend Report 2021" recently released by Mobile Research Open Survey, the use of "YouTube" was the most active to listen to music content. In particular, most of the respondents answered that they were familiar with the reason for using the YouTube music service and that the number of music provided was large. Naver Webtoon, which had the highest utilization rate among webtoon services, was also the biggest factor of choice because there was a webtoon I wanted to see. In the end, the success or failure of the subscription business depends on how much content customers want.

Content subscription service companies are constantly investing to secure and maintain customers.

Naver is collecting intellectual property (IP) to secure content such as webtoons and web novels. Naver acquired a 56.26 percent stake in Web novel platform Munpia for 170 billion won in September. With the acquisition of Munpia, which has 47,000 registered writers, Naver will be able to produce not only webtoons but also videos with Moonpia's IP. In fact, Moonpia's biggest hit web novel "Omniscient Point of View" has already been made into a webtoon and has gained considerable popularity. Earlier in May, Naver acquired Watpad, the world's largest web novel site. Kakao (035720) Entertainment also joined the North American webtoon platform Tapas and web novel platform Radish in May before securing content.

The online video service (OTT) market is also the fiercest place to secure content. This is because overseas OTT services such as Disney+ and Apple TV+ are entering the Korean market one after another at a time when Netflix, which already reigns as an absolute powerhouse in the OTT market, is holding out. The competition to secure contents of domestic OTTs is now spreading to the survival competition for overseas competitors' entry into Korea. In order to strengthen its content lineup, Wave is striving to provide high-quality content to customers by producing its own original content as well as signing agreements with major overseas studios such as HBO. Tving is also continuing to expand its content portfolio by releasing 20 original contents within this year against the offensive of global OTTs.

"Content is the most economical field in subscription services, but it is also the most difficult business model to survive," said Jeon Ho-gyeom, head of the Subscription Economic Strategy Research Center at Seoul Venture University. "Content is a subscription business model that requires considerable effort from the beginning."

Date: 2021-10-15

Reporter: 서화목