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[Journalism Internship] Netflix gives, but also takes away as K-content makers only get tiny slice of success

Published: 24 Feb. 2026, 17:54 Updated: 24 Feb. 2026, 17:55

EDWARD WOO, YEJUN CHOI, YENA KIM, AARON PARK

A drone view shows Netflix logos on buildings in the Hollywood neighborhood in Los Angeles, California, on Jan. 20. [REUTERS/YONHAP]

Netflix is responsible for the popularization and mainstreaming of Korean content. From responding to local viewers to being in charge of global entertainment, the streaming platform allowed for the expansion of Korean content around the world with improved accessibility and changed people’s perceptions of the country.

Despite Korean content enjoying massive popularity on Netflix, a handful of local production companies competing with streaming giant-funded programs are now struggling with rising production costs, which threaten their ability to sustain output in their homeland.

Before the influx of Netflix investment, there was a time when Korean content makers struggled to find funding for the production of K-content. As reported by The Diplomat, “the average production cost per episode for a Korean drama was around $360,000” before Netflix entered the Korean market.

Netflix drastically increased the availability of production funds as its investment in the Korean market significantly increased the production cost per episode. According to The Diplomat, “In 2019, Netflix spent $1.7 million per episode on its first Korean original, ‘Kingdom.’ In 2020, ‘Sweet Home’ cost $2.4 million per episode. Most notably, the budget for ‘Squid Game’ Season 2 reportedly reached $9.8 million per episode in 2024.”

While viewers may have enjoyed watching the final season of “Squid Game” (2021-2025) or the second season of “Culinary Class Wars” (2024-), the underlying problems have the potential to make it harder to watch K-content in the near future.

Netflix as a boon: Cultural benefits

Performers dressed as “Squid Game” (2021-25) soldiers march in a parade through central Seoul, followed by a fan event with cast to celebrate the release of the third season of Netflix's hit series, in Seoul, on June 28, 2025. [REUTERS/YONHAP]

Based on surveys conducted across eight countries, Netflix stated that streaming K-content helps viewers “embrace Korean culture in deeper, more meaningful ways.” With 60 percent of international viewers willing to continue watching K-content, 91 percent of Koreans strongly believe that K-content has opened business opportunities for Korean creators, and another 87 percent believe it has enhanced Korea’s image.

Netflix played a major role in turning K-content into a global cultural phenomenon. Before streaming platforms, Korean shows and movies mainly spread through regional broadcasting or limited international licensing. Now, Netflix distributes Korean content instantly to millions of viewers across continents.

Don Kang, VP of Content at Netflix Korea, has described how Netflix’s global reach has transformed what once felt like a regional niche into a worldwide phenomenon: “In recent years, we’ve really seen this surge of global fandom around K-content, especially around the time of 'Squid Game.' I think for most people outside Korea, 'Squid Game' was the first Korean series that they really watched.”

TheJoongAng Daily states that “Netflix announced it would invest $2.5 billion in Korean content from 2023 to 2026 — around 800 billion to 900 billion won annually” — allowing Korean production companies to secure large-scale funding that was previously difficult to obtain through domestic broadcasters alone. This level of investment has enabled studios to produce higher-budget projects, attract top-tier actors and directors, and compete more directly with global entertainment markets.

According to Netflix, the company provides equal opportunities to all directors and producers, enabling the growth of individuals and companies. For instance, “Sweet Home” and “Kingdom”, both K-Dramas, were funded by Netflix despite a lack of popularity for the “creature” and “zombie” genres at the time, making it a risk Netflix took on K-content.

However, this move gave birth to two of the most popular K-dramas that consistently placed in the top 10 on the platform. Famous directors like Lee Jae-kyoo — the director of "All of Us Are Dead" (2022), a series about high school students trapped in their school during a zombie apocalypse — said they have earned great opportunities to express their creativity, resulting in great success.

Netflix as a threat: The financial paradox

Contestants on the second season of Netflix cooking competition show “Culinary Class Wars” (2025-26) pose for a photo at a press conference at JW Marriott Dongdaemun Square Seoul in Jongno District, central Seoul, on Dec. 17, 2025. [YONHAP]

Despite the global success and demand for K-content and big-budget projects supplied by Netflix, concerns are also growing within Korea’s entertainment industry.

“Smaller domestic producers are increasingly sidelined as bigger projects stay in the spotlight,” according to local news outlet Pulse.

The biggest issue concerning K-content is currently intellectual property (IP) rights, which allow production companies to independently protect and monetize their creative works.

However, according to Kim Yoon-ji, a researcher at the Export-Import Bank of Korea, “Without recouping investment through overseas markets, many now struggle to sustain production.”

The result is a paradox: the budget for episodes of “Squid Game” reached up to $9.8 million — provided by Netflix — in 2024, as reported by The Diplomat. Yet, with the show’s earnings of $890.7 million, Hwang Dong-hyuk, the creator of the hit show, said, “It’s not like Netflix is paying me a bonus. Netflix paid me according to the original contract”, according to The Guardian.

The consequences have become increasingly visible.

“Squid Game” is estimated to have generated over 1 trillion won in economic value, yet its production company reportedly earned little beyond production fees. As The Asia Business Daily mentions, the industrywide sentiment of "even if you make 1 trillion won, nothing is left" emphasizes the unequal distribution of the show’s earnings.

A similar situation unfolded with "The Glory" (2022), which achieved global success that failed to translate into long-term financial gains for its producer due to Netflix’s IP monopoly, as its stock price fell immediately after the broadcast.

The Asia Business Daily states that, though Netflix covers 100 percent of production costs and guarantees production companies a margin of about 3 10 percent, in exchange, Netflix keeps all IP rights.

Contestants on the first season of reality competition series “Physical: 100” (2023) compete in an endurance challenge in this still. [NETFLIX]

A clear example of this shift can be seen with MBC’s variety program “Physical: 100” (2023). The show made history as the first Korean entertainment program to rank No. 1 globally in total viewing hours. Despite this milestone achievement and the massive global exposure it generated, MBC reportedly gained only limited long-term financial benefit.

Despite the massive global exposure it generated, The Asia Business Daily states that even with “the emergence of megahits like ‘Squid Game,’ the limitations of this contract structure have become clear.”

Since Netflix controlled the IP and global distribution rights, domestic producers, such as MBC, were largely restricted to their original production compensation, without access to additional profits from international licensing, merchandising, or potential franchise expansion.

This was because Netflix’s strategy of controlling all IP rights meant additional revenues, such as merchandising or selling rights, wouldn’t benefit the original production company.

Future of K-content on Netflix

A compilation of content streaming or set to release on Netflix [NETFLIX]

By focusing on the “boon” aspect of Netflix streaming K-Content, Export-Import Bank of Korea researcher Kim Yoon-ji believes that it could “erode the grassroots production ecosystem that nurtures new talent and supports genre experimentation,” ultimately preventing genre variation and not giving other “smaller domestic producers” a chance to appear on the Netflix homescreen for viewers.

Kang Dong-han, vice president of Korean Content at Netflix, says the rising production “should not necessarily be viewed as a bad thing.”

“I believe the market is currently undergoing a process of adaptation,” he told the Korea JoongAng Daily. “Of course, this transition can be painful at times. Still, I think this phase will give rise to new and creative attempts.”

BY EDWARD WOO, YEJUN CHOI, YENA KIM, AARON PARK

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