A Study on the Regulation of OTT Mergers under Competition Law

Abstract

The Korean Fair Trade Commission's 2019 decision on the merger of Oksusu and POOQ is important in that it dealt with the first merger between major OTTs, but it is also meaningful in that it dealt with merger in areas where rapid industrial structure changes are taking place. The Korean Fair Trade Commission distinguished the significance of the merger into horizontal and vertical aspects, and recognized competition restraints based on the fact that increased concentration by merger parties in the broadcasting content provision market can negatively affect competition between OTT operators. At this point, it is difficult to avoid the perception that the judgment at the time was inappropriate, considering the rapid growth of Netflix and the continuous decline in the integrated OTT share after the merger. However, it is not possible to make a negative assessment of the innocence just by failing to predict. But the lack of a detailed analysis of the transaction of video content needed to be supported in order to recognize competition restrictions in the vertical sector, as the US courts did in the AT&T and Time-Warner business combination case, sufficient understanding of the competition pattern between OTTs centered on original content and consideration of the industrial situation in which innovative changes are occurring may be a problem. These problems will need to be corrected in the regulation of merger that may occur in the field in the future.