SMR: United against a Global Media Giant

In 2014, recognizing that their leadership in the online media market was weakening, eight Korean television broadcasters severed their ties with YouTube and formed Smart Media Representative Co. Ltd. (SMR), an alliance to collectively distribute online television content and advertising on behalf of the broadcasters. SMR changed the nature of the online video market in Korea. The rights to advertising sales, programming, and distribution that were previously transferred to the platforms were retained by the broadcasters. The nature of distribution also changed to use a format that allowed the broadcasters to package their content and advertisements as one. The profit sharing from advertisements also changed, with broadcasters realizing a substantial increase. The structure had worked well and had been lucrative for the broadcasters and the Korean platform companies that partnered with SMR; however, in 2016, as SMR prepared to re-contract with the stakeholders, the varying goals of the stakeholders threatened to disrupt the structure. What did SMR need to do to maintain these fragile relationships and continue to grow?

This case can be used in strategic marketing, strategic management, or platform business courses at the undergraduate or graduate level. After working through the case and discussion, students will be able to<ul><li>understand the dynamics between content providers and platform companies in the new media age</li><li>develop the ability to cope with the changing market environment; and</li><li>develop skills in negotiation, analysis, and strategic decision making.

• youtube, contents platform, alliance