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While Korean actors, directors, and staff have occasionally participated in foreign drama productions, we have now reached a point where domestic production companies are taking the lead in directly creating localized content rather than simply participating or collaborating. How far has K-drama's localization strategy progressed?

“Secret Playlist” ©TVING

Beyond Exchange and Cooperation: Local Production

On April 16, the global streaming platform Apple TV+ premiered season 2 of the American drama "The Big Door Prize." Set in a small American town, the story revolves around a mysterious machine in a general store that predicts people's destinies. Resembling a small arcade booth, the machine dispenses cards with words akin to “today’s fortune” when users insert coins and input their personal information. These cards spark significant changes in the lives of the town’s residents, driving the narrative. This drama was co-produced by Skydance and another production company - Korea's Studio Dragon.
Korean production companies have increasingly ventured into creating dramas overseas. Rather than just filming in foreign locations, they are now producing content locally, tailored to specific markets as original productions. While there have been frequent personnel exchange and co-production - such as Japanese director Miike Takashi directing Disney+'s Korean drama "Connect" (2022) and Korean director Lee Jae-han directing Japan's Prime Video film "SEE HEAR LOVE" (2023) - attempts by Korean production companies to create local dramas began in earnest after 2021. Season 1 of "The Big Door Prize" in 2021 was the first American drama produced by a Korean production company.

"The Big Door Prize" ©Apple TV+

Korean Production Companies Venture into Localization Through Acquisitions and Partnerships

Korean production companies are employing localization strategies that primarily involve establishing foreign subsidiaries, co-producing with local production companies, or pursuing mergers and acquisitions. CJ ENM acquired renowned U.S. production company Endeavor Content, rebranding it as Fifth Season, and has since produced American dramas like "Tokyo Vice" (HBO Max) and "See: Dark Days" (Apple TV+) for local platforms. Similarly, another Korean production company SLL also acquired the well-known U.S. production company Wiip and is now producing Netflix's American drama "Bodkin" and Prime Video's "The Summer I Turned Pretty" Season 3. "The Big Door Prize" began when Studio Dragon's parent company CJ ENM invested in Skydance, forming a partnership. Skydance proposed collaboration with Studio Dragon, leading to joint development and the release of Season 1 in 2021. Studio Dragon is also producing the Japanese drama "Like Asura" directed by Kore-eda Hirokazu and starring Aoi Yu. Additionally, they're producing "The Plotters" with Universal Studios and "Master Mind" with CBS Studios.

Global Influence of Korean Drama Production Companies

Korean drama production companies are taking their global presence to the next level, with international platforms directly commissioning them to create Korean dramas. Last year's "Secret Playlist," produced by Playlist, is a Korean drama made by a Korean production company but aired as a Hulu Japan original drama. According to Playlist, Hulu Japan specifically requested a Korean drama, showcasing that domestic production companies can secure commissions from broadcasters worldwide. Genre-specific localization strategies are also being attempted. Hanyang Studio is creating BL (Boys' Love) drama series in Thailand, collaborating with local production companies, as Thailand has a large BL drama market. Japan is the largest producer of BL dramas, while Thailand is considered their origin. Korean BL dramas are distinguished by incorporating diverse elements like murder mysteries into their storylines. By combining Korean BL drama production expertise with both local and Korean actors, they can target both markets.

"Secret Playlist" ©TVING

Changes Brought by Growth and Crisis in the Domestic Drama Market

The localization strategies of Korean drama production companies emerged from the flow of growth and challenges in the domestic drama market. After Netflix began its Korean service in 2016, the domestic drama market restructured around OTT platforms following the successive success of "Kingdom" (2019), "Sweet Home" (2020), and "Squid Game" (2021). These platforms allowed for bold experiments in genres like zombie, creature, and science fiction—genres that traditional TV networks had avoided due to their high production costs. With "Squid Game" and the film "Parasite" achieving success at major American awards ceremonies, global attention focused on Korea's content production capabilities, earning worldwide recognition.
However, opportunities soon led to challenges. As competition for global OTT platforms intensified and rushed to produce new, large-scale productions, differentiation within OTT platforms dwindled and quality deterioration became apparent. The influx of global OTT capital became the standard, driving drama production costs to unsustainable levels even in the domestic market. Currently, approximately 30 completed dramas are reportedly locked away in storage. Some productions have been halted mid-project because the cost-benefit analysis favored discontinuation over completion. Even "Weak Hero: Class 1" Season 2, which gained attention on the domestic OTT platform Wavve in 2022, moved to Netflix for production cost reasons. While production companies need more money to improve upon Season 1, Wavve found the financial burden unmanageable.

©Shutterstock

In the Korean drama market, where production companies' capabilities have honed their skills through diverse experiences but face limited platforms to fully showcase their talents, localization strategies have become an escape route, solution, and new beginning. Korean production companies are aiming to expand globally, using the United States and Japan as bases. Both the U.S. and Japanese broadcasting markets are significantly larger than Korea's broadcasting market. As of 2021, the U.S. broadcasting market size was $189.6 billion, over 12 times larger than Korea's. Japan's is known to be more than 2.5 times larger. While the scale difference with Japan is less pronounced than with the U.S., Japan's loyal fan base makes it easier to generate revenue through diverse IP utilization. In Japan, it is a natural progression to adapt dramas into various genres like films and sell related merchandise.

IP Ownership Enables Production Companies' Localization Strategy

Korean production companies' ability to pursue localization strategies is largely attributed to their control over IP. Before Netflix, production companies received funding from broadcasters and transferred IP rights, with little awareness of the long-term implications. When Netflix began taking all rights in exchange for substantial production funding, IP issues became an industry focal point. The success of Kingdom and Squid Game highlighted this challenge—while these productions achieved global acclaim, the production companies did not reap proportional financial benefits. This shift in perspective emphasized the importance of IP ownership over immediate production funding. AStory, which produced "Kingdom," secured IP rights by airing "Extraordinary Attorney Woo" on the new channel ENA rather than Netflix in 2022. This success enabled various ventures including musical adaptations and foreign remakes.

"Extraordinary Attorney Woo" ©ENA

Production companies are actively utilizing Korean drama IP in their localization strategies. Studio Dragon is planning American adaptations of works like "Crash Landing on You" and "Hotel Del Luna." However, industry experts caution that a systematic and long-term approach is essential rather than chasing immediate profits. This perspective is informed by past experiences, such as when Korean creators ventured into the Chinese market to produce dramas and variety shows with local production companies, only to face a sudden shutdown following THAAD-related tensions. Without addressing domestic drama market challenges, production companies' localization strategies will remain limited. While the Media and Content Industry Convergence Development Committee proposed improvements in March including "expanding video content production tax credits up to 30%" and "establishing a trillion-won K-content media strategy fund." However, there is a growing consensus that more fundamental measures are necessary

Written by Nam Ji-eun (The Hankyoreh Newspaper Reporter)

Original Article URL: https://www.kocca.kr/n_content/kocca_vol31/vol31/02.html