OTT Subscription Costs on the Rise... Illegal Alternative Sites Proliferating

Disney+ Raises Prices for Key Plans
Netflix Also Reflects U.S. Price Hikes in Korea
Consumers Turn to Illegal Alternative Sites
Spike in Access-Blocking Requests

Global online video streaming (OTT) platforms are raising their prices one after another in a bid to increase average revenue per user (ARPU). As these hikes, which started overseas, put pressure on the domestic market, more users, feeling the strain of higher subscription fees, are turning to illegal alternative sites.

According to the industry on September 30, Disney+ recently increased the price of its main products, including its ad-free premium plan, in the U.S. market. The standalone plan rose by up to $2.5 per month, and bundled products increased by up to $3 per month.

It is widely observed that global OTT platforms typically raise prices abroad first, then apply those hikes to the Korean market after a time lag, so this latest increase could soon affect subscription fees in Korea as well. For instance, Netflix raised fees in the U.S. and other countries in January of last year, then about four months later raised the price of its 'Standard with Ads' plan in Korea from 5,500 won to 7,000 won. This year, Netflix has ratcheted up pressure by increasing prices again in markets like the U.S. and Europe in both March and September. For Disney+, since subscription fees have been frozen domestically for nearly three years since November 2023, there is a high likelihood of additional increases.

As the financial burden grows for consumers, more people are turning to illegal copyright-infringing sites. Although authorities continue their efforts to block access, operators of these illegal services keep attracting users by simply changing their site URLs and launching so-called 'mirror sites.'

According to data submitted to Democratic Party lawmaker Hwang Jeongah from the National Assembly's Science, ICT, Broadcasting, and Communications Committee by the Korea Communications Standards Commission, there were a total of 24,297 requests to block access to copyright-infringing content between 2023 and August of this year. Of these, repeated blocks on alternative sites set up to bypass previous restrictions accounted for 67.5% (16,390 cases) of the total. Although the number of blocks had been declining for two consecutive years, it surged this year, with 2,506 cases as of August already surpassing last year’s figure of 1,877.

The most frequently blocked site was 'HooHooTV,' which broadcasts video content without authorization, with 205 blocks. This was followed by 'Ajitun' with 146 blocks, 'NewToki' with 137, and both 'TVWiki' and 'TVChak' with 117 blocks each. As of August this year, TVWiki and NewToki had already been blocked 82 and 45 times, respectively.

To combat illegal mirror sites, the government has also stepped up its crackdown. Since May of this year, the Ministry of Culture, Sports and Tourism and the Korea Communications Standards Commission have fully implemented an "emergency blocking system," which shuts down access to illegal mirror sites within a day of detection. Additionally, AI-powered automated detection systems have been upgraded to track address changes in real time, and officials are working in conjunction with INTERPOL, U.S. law enforcement, and other agencies to target illegal servers based overseas.

However, experts point out that government crackdowns alone are not enough to fundamentally restrict the cross-border illegal streaming market. The ongoing trend of rising subscription fees by global platforms may even push highly loyal core users into the illegal copying market by increasing consumer fatigue.

In a recent report, Professor Jang Hongseok and his research team at Tulane University's Freeman School of Business in the U.S. noted, "For heavy users in particular, the one-time effort required to obtain pirated copies is a much cheaper alternative to constantly rising subscription fees," adding, "With worldwide digital product sales expected to reach $511 billion by 2031, platform companies must maintain subscription value by also offering services that prevent copying, such as cloud services and essential security patches."

This content was produced with the assistance of AI translation services.