BEIJING — China's Internet heavyweights all seem to be joining a kind of film industry gold rush. Sohu, one of China's largest Internet portal operators, has acquired a 6.4% stake in KeyEast, a South Korean entertainment company, and Sohu CEO Charles Zhang has announced that it will consider producing films once the company's downloading platform matures.
Alibaba, the e-commerce group whose sales rivals eBay and Amazon combined, long ago created its own film and television company, along with two online video portals: leTV and Iqiyi. Through Alibaba, which is set for one of the largest IPO's ever, Internet users can even make investments in films. Up to now, four film investment projects have been completed through this business model.
Meanwhile, Iqiyi plans to launch seven domestic films and one Hollywood movie through its Internet platform by cooperating with both Chinese and foreign film companies in the upcoming year.
The plans of these Internet companies are all more or less the same. That is, they want to use crowd funding, big-data analysis, online sales of movie tickets and derivative e-commerce products to create a maximum profit margin for their films.
Obviously, the aim of these Internet companies isn't just to make gains at the box office but also to generate greater commercial value through online video subscription, derivative e-commerce and games development.
House of Cards, the American drama series known to inform its production by using big data, is the cult example for China's Internet companies. They are convinced that big data will help them tap more diversified revenues from films.
Nonetheless, filmmaking is above all an art. What decides a film's success or failure is, first of all, the script and the script writer behind it. How much the natural gift counts for in this profession where working hard is not the only requirement is most felt by the spectators when watching a bad movie. So whether big data can really help script writers to develop more interesting plots is certainly a complex issue.
The focused film screenings of the Hollywood blockbuster How to Train Your Dragon are an inspiration. That is, big data can improve industrial screenplay production development. In the two special screenings — one for the professionals and the other for families — market researchers recorded in detail every minute of audience responses, such as laughter or indifference. The data was then fed back to the producer to alter the film. A few months later, a follow-up screening with the plot modified according to the previous viewers' responses was programmed to find out what effect it had.
But at the end of the day, will big data improve a film? After all, film is an art before being a science. Success or failure of China's Internet giants is in how to find a gold-plated script writer.
Crunching the numbers of South Korea's personal and household debt offers a glimpse into what drives the win-or-die plot of the Netflix hit produced in the Asian country.
SEOUL — The South Korean series Squid Game has become the most viewed series on Netflix, watched by over 111 million viewers and counting. It has also generated a wave of debate online and off about its provocative message about contemporary life.
The plot follows the story of a desperate man in debt, who receives a mysterious invitation to play a game in which the contestants gamble their lives on six childhood games, with the winner awarded a prize of 45.6 billion won ($38 million)... while the losers face death.
It's a plot that many have noted is not quite as surreal as it sounds, a reflection of the reality of Korean society today mired in personal debt.
Seoul housing prices top London and New York
In the polished streets of downtown Seoul, one sees endless cards and coupons advertising loans scattered on the ground. Since the outbreak of the pandemic, as the demand for loans in South Korea has exploded, lax lending policies have led to a rapid increase in personal debt.
According to the South Korean Central Bank's "Monetary Credit Policy Report," household debt reached 105% of GDP in the first quarter of this year, equivalent to approximately $1.5 trillion at the end of March, with a major share tied up in home mortgages.
Average home loans are equivalent to 270% of annual income.
One reason behind the debts is the soaring housing prices. In Seoul, home to nearly half of the country's population, housing prices are now among the highest in the world. The price to income ratio (PIR), which weighs the average price of a home to the average annual household income, is 12.04 in Seoul, compared to 8.4 in San Francisco, 8.2 in London and 5.4 in New York.
According to the Korea Real Estate Commission, 42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s. For those in their 30s, the average amount borrowed is equivalent to 270% of their annual income.
Playing the stock market
At the same time, the South Korean stock market is booming. The increased demand to buy stocks has led to an increase in other loans such as credit. The ratio for Korean shareholders conducting credit financing, i.e. borrowing from securities companies to secure stock holdings, had reached 21.4 trillion won ($17.7 billion), further increasing the indebtedness of households.
A 30-year-old Seoul office worker who bought stocks through various forms of borrowing was interviewed by Reuters this year, and said he was "very foolish not to take advantage of the rebound."
In addition to his 100 million won ($84,000) overdraft account, he also took out a 100 million won loan against his house in Seoul, and a 50 million won stock pledge. All of these demands on the stock market have further exacerbated the problem of household debt.
42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s
Game of survival
In response to the accumulating financial risks, the Bank of Korea has restricted the release of loans and has announced its first interest rate hike in three years at the end of August.
But experts believe that even if banks cut loans or raise interest rates, those who need money will look for other ways to borrow, often turning to more costly institutions and mechanisms.
This all risks leading to what one can call a "debt trap," one loan piling on top of another. That brings us back to the plot of Squid Game, "Either you live or I do." South Korean society has turned into a game of survival.
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