September 16, 2025
SEOUL – Netflix’s customized ad service launched in Korea on Sept. 2 could further accelerate the shift in ad spending from traditional broadcasters to online platforms — posing a significant threat to the financial stability and long-term viability of the country’s entire media industry, experts warn.
The service, called Netflix Ads Suite, is the platform’s proprietary advertising tool for brands on its ad-supported tier, offering advertisers tools for audience targeting, creative solutions and integration with external ad networks to better embed ads. Netflix Korea says Ads Suite is ultimately about exploring how to more seamlessly integrate advertising into its content.
The service was first rolled out in the US, followed by Europe, before expanding mid-year to all remaining markets offering the ad-supported plan.
Ads Suite has significant potential to attract Korean advertisers by offering personalized campaigns rarely offered in the local market, experts say.
“Customized advertising has an overwhelmingly competitive edge. All advertisers want to do that, but not many can actually figure out which ads appeal to which demographic,” Byun Sang-kyu, a professor in the division of culture and film media at Hoseo University, told The Korea Herald on Sept. 11.
“If Netflix also provides customized service along with content-specific data, it could be very attractive to Korean advertisers,” he added.
The rollout has sparked concerns over its potential impact on Korea’s broader advertising ecosystem, which has seen its sales decline steadily over the years.
Last year, total broadcast ad sales fell by 201 billion won, or 8.1 percent, to 2.2 trillion won. Terrestrial broadcasters were hit especially hard, with revenue dropping 91.9 billion won, a 9.9 percent decline. For the first time in 2023, terrestrial broadcast ad revenue slipped below the 1 trillion won threshold, sliding into the 800 billion won range.
While no single factor can fully explain the decline of a key revenue source for broadcasters, Byun noted that the migration of advertising to streaming platforms is likely a major contributor. Currently, advertising accounts for roughly one-quarter to one-third of total sales for major Korean broadcasters.
“The (Korean) advertising market is growing year by year as GDP rises. But broadcast ad sales keep shrinking. That money has to go somewhere, and it’s likely largely flowing into digital, particularly to streaming platforms like Netflix and YouTube. They don’t release detailed ad revenue figures, but it’s highly likely that a significant share is moving there,” Byun said.
Meanwhile, Netflix’s ad sales in Korea through its ad-supported tier currently exceed those of the nation’s leading broadcasters.
While Netflix does not disclose country-specific ad revenue figures, Byun projected at a 2023 conference that the streamer could generate between 268 billion and 371 billion won annually in domestic ad revenue within three to five years. By comparison, Korea’s major broadcasters earned significantly less in 2024: MBC, 206 billion won; SBS, 241 billion won; KBS, 167 billion won.
If broadcasters keep losing advertising revenue to Netflix and the trend accelerates with the launch of Netflix Ads Suite, Korean networks — which mostly depend on ad sales — could face a potentially irreversible cascade of financial challenges.
To maintain profits, broadcasters may become increasingly dependent on overseas platforms for content distribution — another crucial revenue source — allowing overseas platforms to consolidate control over data, advertising and distribution rights.
The downstream effects could include a contraction of local news and public-interest programming, as well as a weakening of Korea’s digital sovereignty, limiting the government’s ability to oversee and influence its domestic data and content ecosystem.
Some experts suggest requiring streaming services to provide standardized ad and viewership data to help the government manage potential impacts on the broadcasting industry.
“Our private and public broadcasters are legally required to submit business and financial data to the government,” Byun noted.
“There’s been an ongoing debate that global streaming services should disclose viewership and ad sales data, but they haven’t. Without this information, the government cannot effectively regulate or respond to the platforms’ influence, making data disclosure a public-interest necessity.”
Others proposed focusing on ad formats that Netflix would have difficulty replicating on its platform.
“What we once thought about only theoretically has now become a reality. With the introduction of Ads Suite, advertisers are finally getting what they wanted,” Kim Chan-souk, professor in the department of advertising and public relations at Cheongju University, told The Korea Herald on Monday.
Kim suggested that broadcasters should focus on ads that deliver social messages and enhance brand value.
“For advertisers, boosting short-term sales and expanding market share is important, but earning a good reputation and trust from consumers and local communities is just as crucial,” said Kim.
“In the case of Netflix Ads Suite campaigns, it doesn’t seem easy to build that kind of consumer and community trust or to earn a positive reputation. It feels more geared toward product-focused advertising. Broadcasters, therefore, need to double down on strategies that restore, earn and maintain the trust of consumers and their communities.”
