When Netflix first started in 1997, they were a small company wanting to apply Amazon’s model with books to DVDs (a new technology at the time). They snuck into a $16 billion industry with 30 employees and 925 DVD titles. In 2023, Netflix is estimated to be worth $140 billion (over 8x the amount of the industry they originally entered) and is one of the most recognisable brands in the world. Following breakneck growth over the pandemic years, Netflix is now a home staple in over 190 countries, and they have just reached over $230 million paid subscribers.

Netflix's growth strategy includes expanding its international footprint, investing in original content, and exploring new ways to engage with users. Adhering to this strategy, last week, Netflix revealed its bold plan to invest a whopping $2.5 billion (NZ$4 billion) into South Korean K-dramas, movies, and reality shows.

The streaming giant is banking on this hefty investment to keep churning out gripping series like Squid Game, Crash Landing on You, and Physical: 100, which have captured viewers' attention worldwide. The investment will be used simultaneously to create new content, as well as purchase rights to content that has already been made.

One Netflix original, The Glory, has proven to be a hit among audiences worldwide, ranking as one of the top 10 most-watched series in over 90 countries, including France, India, Argentina, and South Africa. This highlights the immense potential of investing in South Korean content to attract and retain viewers internationally.

As such, the collaboration between Netflix and South Korea's thriving entertainment industry presents a promising future for both parties. Investing in Asia's fourth-largest economy presents a significant opportunity for Netflix to expand its audience, particularly since its growth in the European and American markets has slowed. Although last quarter's subscriber growth of 1.75 million included a substantial 1.46 million from Asia, the total figure fell short of the predicted 2.41 million.

This investment presents an incredible opportunity for South Korean multimedia companies to attract Netflix’s big money and stream shows internationally that were successful domestically. One of South Korea's biggest film production and distribution companies, SHOWBOX Corp, has seen its stock prices surge by up to 26%. SHOWBOX has invested in Siren Pictures, the producer of the hit show Squid Game, and is expected to bring more global sensations like it.

Additionally, Studio Santa Claus Entertainment, which collaborated with Netflix on the 2021 series My Name, saw a 23% increase in its stock price right after the news was announced.

In my opinion, Netflix's latest investment in South Korean content is a brilliant move that highlights their dedication to staying ahead of the competition. It's clear that South Korean media has the potential to captivate audiences worldwide, and I think it is a smart move on Netflix’s part to recognise that potential.

However, investing such a large sum of money comes with risks, and I'm curious to see how this investment will play out in the long run. While Netflix's recent investment in South Korean content may seem like a smart move, there is a risk that the current global enthusiasm for South Korean TV/film is just a trend, and that interest could wane significantly.

While there's no denying the potential of South Korean media to attract and retain viewers on a global scale right now, it's important to acknowledge the uncertainty involved in making such a large investment over 5 years in a changeable market. Netflix must remain vigilant to changes in viewership trends and act accordingly.

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