Why Naver, Afreeca TV losing to YouTube, Twitch?

Seen is the front page of online streaming service platform Twitch. / Captured from Twitch

By Baek Byung-yeul

Home-grown video streaming service firms ― Naver and Afreeca TV ― have been losing ground as a growing number of people are turning to overseas platforms such as YouTube and Twitch, data showed Thursday.

Industry officials said YouTube and Twitch have become a major source of entertainment and news for not only the young generation but all age groups as these platforms have lower hurdles for new content creators and have more efficient communication channels with their users, compared to local streaming platforms.

To catch up with strong overseas players, local streaming providers have to strengthen their efforts to welcome creators and offer a user-friendly interface in content distribution, they said.

According to data by market tracker Nielsen Koreanclick, YouTube and Twitch are expanding their footprints here. The number of monthly active users of YouTube in December 2018 came to 25,543,487, about a 3 million user increase year-on-year.

The number of monthly active users of mobile app Twitch, specializing in game streaming, came to 908,393 in 2018, about three times more than 2016 when it was at 302,565.

While Twitch has shown high growth here, Afreeca TV, a local streaming service provider, has seen a decline in its users. The number of monthly active users of Afreeca TV's mobile app was peaked at 1.99 million in December 2016 but it was decreased to about 1.25 million in 2017.

Naver is also struggling with its streaming service. According to a survey of 7,426 online video streaming users conducted by the Korea Information Society Development Institute, only 6.6 percent said Naver is the main source for viewing videos in 2017, down from 8.5 percent in 2016.

To resurrect its streaming service, Naver CEO Han Seong-sook said the firm will focus on intensifying its video service. “We will strengthen our video streaming service by allowing users to produce their videos through every service provided by Naver,” Han said during a conference call on Jan. 31.

Kim Nam-doo, an analyst of the Korea Information Society Development Institute, said YouTube has been gaining popularity for its distinguished content distribution service. While YouTube displays popular content regardless of age or personal preferences, it also displays popular content based on personal interests.

“While local streaming providers have given preference to content produced by local broadcasters, YouTube doesn't,” Kim said.

Afreeca TV, a local streaming service provider, said it will focus more on video-on-demand (VOD) service, to regain its falling number of users.

“The current trend of the streaming market is editing their content into short versions. Many YouTube creators are making profits by making short versions of their video content. As the videos are about five to 10 minutes long, users can easily consume their videos,” an Afreeca TV spokesperson said.

“We are also planning to strengthen VOD service by supporting video editing services for broadcasting jockey content creators so users can enjoy short video clips on their smart devices or PCs.”

Like Twitch, Afreeca TV is also specialized in game streaming. The firm operates an esports stadium in southern Seoul and has held various esports competitions for games such as Blizzard Entertainment's “StarCraft,” PUBG's “PlayerUnknown's Battlegrounds” and Riot Games' “League of Legends.”

Teaming up with local broadcaster SBS TV, Afreeca TV also established a joint venture, SBS Afreeca TV, last November for esports and sports broadcasting. It is also broadcasting the biannual esports championship “League of Legends Champions Korea” starting this 2019 spring season.