Text | Wang Yuchan Edited by | Zhang Xinyu
Not surprisingly, this year's global drama contest has already selected the hottest titles – Netflix's Korean-language self-produced drama "Squid Game" became the most watched non-English drama in the platform's history within half a month of broadcasting, and officially became the most watched episode in its history less than four weeks after its launch. In more than 190 countries and regions covered by Netflix, this Korean-language drama has reached the top without suspense.
Pictured: Netflix official tweet
That is to say, this drama that all people in the world outside of Korea and North Korea need to watch subtitles beats Netflix works such as "Stranger Things", "The Queen's Chess Game", "Raising Tigers", "The Crown" and so on, which are closer to the European and American markets in terms of language and culture, and reconciles the tastes of the global market.
Although Chinese mainland is one of the four regions in the world that have not been able to cover Netflix services (the other three are Syria, Crimea and other countries), many Chinese viewers have watched "Squid Games" on their own merits and frequently topped Chinese social media hot searches, with the Weibo entry #Squid Game getting 1.97 billion reads and 412,000 discussions. Among them, in addition to the discussion of the plot and the controversy over preferences, there is another question that has been repeatedly raised:
Why is the plan of East Asian culture to go to sea preempted by the Koreans?
<h3>Netflix needs Asia, and Hallyu needs the world</h3>
The emergence of "Squid Games" is the inevitable result of Netflix's long-term investment in the Japanese and Korean markets.
In March, Kim Min-young, Netflix's head of content for Korea and Asia, revealed what Netflix has invested since entering the South Korean market: a total of 770 billion won (about 4.2 billion yuan) will be invested by 2021, generating economic benefits of 5600 billion won (about 30.5 billion yuan) and providing 16,000 local jobs.
Before "Squid Game", Netflix had invested in the production of "Kingdom", "Love Forced Landing", "Itaewon Class", "I Am a Relic Sorter", "Tamako", "Human Classroom", "Telephone", "Paradise Night" and other episodes and movies in South Korea, and continued Netflix's consistent "a lot of betting, there is always a one that can explode" style, although the reputation is different, but basically every year there are explosive models.
The Kingdom
Netflix's Japanese strategy is similar, and in recent years, it has produced popular works such as "Demon Man", "Jojo's Wonderful Adventure", "Naked Director" and other popular works, and india has also seen the emergence of new works such as "Sacred Game".
For this global video streaming platform, the user growth in the US market has long reached the ceiling, and the Asian market with a large user base and a booming content industry is undoubtedly the best new battlefield. In the third quarter of 2017, Netflix's number of international paying subscribers has officially surpassed the number of us paying subscribers, and in recent quarters, despite the decline in Netflix's North American market, it has continued to grow globally. The content produced by the international market has also benignly fed back the European and American markets. Last year, 97 percent of U.S. viewers had seen at least one non-English film or television production.
For Japanese and Korean filmmakers, there is also an urgent need for platforms like Netflix to send their content to every corner of Asia. South Korea's total population has been hovering around 50 million for the past 8 years, and as early as 2017, according to Baidu Tieba data, Chinese at least 20 million Japanese and Korean idol fans on the Internet.
The "Korean restriction order" caused South Korean entertainment companies to lose direct contact with these 20 million people overnight. Prior to this, China was one of the largest export markets for South Korea's cultural industry, and according to the Korea Institute of Modern Economic Research, exports to China accounted for about 27% of the total exports of South Korea's cultural industry. Forced to lose China's familiar and vast market, South Korea's cultural industry had to find another way.
In the same year, the North American streaming media platform Netflix officially launched its globalization strategy, and the market demand of the Korean cultural industry bumped into Netflix's global content demand.
In modern history, the Korean people's fate is uncertain: a small peninsula, a nation, and a culture have been forced to live in two diametrically opposed political and economic systems in the context of the Cold War, and south Korea's modernization process has not been smooth, and while economic development, there are many social contradictions. Unfortunately, the country is fortunate, but various special social problems provide inexhaustible materials for the Korean cultural industry, relatively loose supervision and extremely support cultural output, even without Netflix, the Korean film and television industry is advancing by leaps and bounds.
In 2020, South Korean director Bong Joon-ho's "Parasite" won the 92nd Academy Awards for Best Picture, Best International Film, Best Screenplay, Best Director and other super awards, becoming the first non-English dialogue film to win best picture and the first best film with Asian actors, breaking a number of histories. If "Parasite" has been recognized by the academic schools of European and American film and television circles, then "Squid Game" has truly occupied the vast market of the most ordinary audiences in Europe and the United States.
Therefore, the Korean Wave was able to go to Europe and the United States to the world, and in a way, there was both the inevitability of "cultural nation-building" and the accident caused by geopolitics in a special historical period.
In the field of Internet services, ByteDance's social content product TikTok has successfully entered the global market and even threatened Facebook; in the field of games, The Original God, the first anniversary of Mihayou's release, has also completed the task of cultural output. However, in the field of film and television, for various reasons, compared with neighboring Japan and South Korea, there are still some regrets.
<h3>It's all streaming, and Netflix has a completely different way of playing than IYouteng</h3>
The total investment of Squid Games is 20 billion won (about 110 million yuan), and the single integration is 12 million yuan.
Is this a high-cost episode? According to the average Netflix homegrown drama, it counts. But according to the average level of domestic dramas, it really doesn't count.
36Kr has previously written an article analyzing the average input cost of domestic dramas: domestic streaming media platforms such as iQiyi, Tencent Video and Youku will make or purchase dramas like Netflix every year, and the cost of an S+-grade costume drama will usually be more than 300 million yuan, and occasionally there are cases of 400-500 million dramas.
Before the pay restriction order, most of the cost was spent on paying traffic stars. Previously, traffic actress Zheng Shuang was exposed to a drama with a salary of 160 million yuan, and the daily salary of 2.08 million yuan also greatly stimulated the nerves of netizens. But these episodes are obviously completely incomparable with "Squid Game" in terms of word-of-mouth and ratings, let alone cultural output to the European and American markets.
The actor's salary is high, and the cost of "making episodes" naturally has to be compressed to the limit. In the cost-heavy deformity model, many domestic drama screenwriters who are obviously very important but have a weak right to speak need to follow the opinions of the producers to make countless revisions, hand over a script that they are not satisfied with, get a pitiful income, wait for the drama to go online, and then be scolded by the audience.
On the contrary, because Netflix has many investment projects around the world and the limited cost of a single series, it is neither necessary nor capable of fine management of each line in each episode, and the creators have gained more freedom. "Kingdom" screenwriter Jin Yinji once famously said: "Netflix never expresses any opinion, only gives money." "This is enough to make some Chinese filmmakers nostalgic for twenty years ago, when the film and television circle was mainly invested by Shanxi coal bosses."
Netflix has never disclosed how it settles with content studios, but Yahoo Finance quoted five interviewees who have done business with Netflix as saying that Netflix usually buys out the rights at a time, the price is "130% of the production cost", and all subsequent revenues have nothing to do with the producer. The general settlement method of TV stations is to pay "60-70% of the production cost" in advance, and if the series is well received, it will be divided with the producer.
In fact, the mainstream settlement model of domestic dramas and streaming media is similar to Netflix, but this model needs to operate based on a premise: after the platform side buys the series, it needs to attract enough viewers to pay a high enough subscription fee to recover the cost. Otherwise, the platform side will definitely lose money.
That's why Netflix is going global. In the second quarter of 2019, Netflix's U.S. domestic market experienced a decline in the number of users for the first time, which means that the local market has basically reached the ceiling - which is similar to the current situation of iYoteng in the Chinese market.
Image source: U.S. Stock Research Agency
The high-investment model of video streaming has led to Netflix having to source content in the global market and attract global users to avoid getting bogged down in the United States. Although this is also the only way for Aiyouteng, it is still in a very early stage for Chinese content platforms to go global.
In June 2019, iQiyi and Tencent launched overseas versions of the app almost simultaneously, and both set their sights on the Southeast Asian market where content supply exceeded demand. In the past two years, both platforms have invested in local investment in shooting a lot of local dramas, but we have not seen works with more influence than the local market, let alone Netflix's global sowing and global harvesting model.
Another worrying problem is that for Aiyouteng, whether it is Chinese mainland or Southeast Asia, it is difficult for video streaming platforms to charge users high subscription fees, and can only fill the deficit with other models such as advertising. After the iQIYI membership fee increase in November last year, the number of paid users in the following quarter fell slightly, proving that there are still many people who cannot accept the increase from 15 yuan to 19 yuan in just 4 yuan in January.
In contrast, Netflix, which refuses ads, has $8.99 (about 58 yuan) for basic members in the United States, $13.99 for standard members and $17.99 (about 115 yuan) for premium members, which is so big that the difference between it and IYoteng VIP does not look like the same kind of business.
On October 4, iQiyi, Youku and Tencent Video announced on the same day that they would cancel the advanced on-demand of episodes, and an "innovative" revenue model that was widely criticized by users but was once regarded as expected to save domestic streaming media became history.
From 2015 to 2020, iQIYI's net losses were 2.575 billion yuan, 3.074 billion yuan, 3.737 billion yuan, 9 billion yuan, 10.3 billion yuan and 7 billion yuan, respectively, and the cumulative loss in 6 years has exceeded 35 billion yuan. Youku and Tencent Video, which are not independently listed, did not disclose financial figures for the latest year, but in 2019, Tencent Video lost 3 billion yuan in operations, and Alibaba Entertainment (with Youku Video as the core) lost 15.8 billion yuan. In the new environment of strong supervision of anti-monopoly since last year, there are still "jitter fast B" on the sidelines, and aiyuteng can solve the problem of huge losses with fewer and fewer means, and they are increasingly not allowed to be spent on meaningless long video involutions.
Compared with Netflix, perhaps streaming in China is more like a squid game with a super low probability of winning.