Naver Corp. strategically invested 40 billion won ($35 million) worth of shares in the South Korean entertainment giant CJ ENM Co.’s over-the-top (OTT) service unit TVing Co. The new investment would raise Naver’s shares to 15%, making it the second-largest TVing shareholder after CJ ENM.
Earlier, Naver announced it would be entering the OTT media sector by purchasing stakes of CJ ENM’s TVing.
After spinning off from CJ ENM in October last year, TVing has acquired more than 3.34 million subscribers. TVing also aims to become the country’s number one OTT service provider by competing against numerous companies, including Netflix.
Cooperating for Mutual Growth
According to Naver, its partnership with TVing would further reinforce its footing in the OTT service market. A CJ ENM official also revealed that Naver and CJ ENM would continue fortifying their cooperation for mutual growth.
Naver would purchase a total of 261,817 TVing shares at 152,778 won per piece in the two companies’ newest collaboration. Naver’s investment in the online streaming platform demonstrates its dedication to increasing original content production.
Previously in 2020, Naver and CJ Group, a leading logistics and entertainment company, signed a 600 billion won ($531 million) share-swap deal. Under their agreement, Naver could utilize CJ’s expansive distribution network while CJ could introduce content on Naver’s Line messenger app.
Besides the previous share-swap deal and new stake purchase, Naver and CJ ENM recently teamed up to secure Munpia Inc. Moreover, Naver obtained a 64% share in the third-largest South Korean web novel platform, boosting its webtoon sector presence.
Co-Producing Original Content
CJ ENM currently operates a comprehensive content planning and production platform. Meanwhile, Naver holds an extensive web novel and webtoon intellectual property (IP) portfolio. The two companies also plan to utilize their field expertise to create synergy across global and local entertainment scenes.
“We plan to diversify our content portfolio through aggressive investments and beef up television-specific services, such as providing personalized content,” said Yang Ji-Eul, CEO of TVing. Yang also stated that TVing’s close cooperation with Naver would boost its original content to international and domestic markets.
Following the stake purchase, Naver and CJ ENM’s TVing would co-develop and co-distribute original entertainment content. Industry analysts also expect CJ ENM to use Naver’s wide-ranging IP library to produce numerous films and TV series.
On the other hand, Naver’s OTT streaming service expansion would encourage its online portal users to keep using the platform.
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