Tens of billions in contract fees and comment manipulation: The side effects of the winner-take-all structure in the online lecture market

As the online lecture (in-gang) market, which has grown to an annual scale of 200 billion won, transforms into a winner-take-all structure based on massive capital, criticisms are arising that instead of qualitative improvements in education, excessive marketing competition and side effects are intensifying. The online lecture market, which has grown rapidly since the late 2000s, has expanded to the point where the value of star instructors reaches tens of billions of won, but the fierce struggle for interests among companies is leading to damages for examinees.

Comment manipulation using virtual characters and overheated marketing

Illegal marketing methods used by online lecture companies to increase market share were also pointed out as a problem. According to internal documents from a marketing agency made public, comment manipulation is carried out through 'nurtured IDs' that set up characters to appear like real people, and 'guerrilla-style IDs' that respond to short-term issues. In the case of nurtured IDs, they are operated by creating virtual personas using Excel to organize specific details such as a person's gender, residence, and grade, and then posting comments in communities.

As a real case, mathematics instructor Woo Yeong-cheol once proceeded with a lawsuit, claiming that a large academy purchased portal IDs through an agency to conduct comment promotion. As a result of the prosecution investigation, it was confirmed that the agency in question purchased IDs and posted comments, and fines were sentenced to those involved. Such comment manipulation acts as a factor that hinders the rational choice of instructors by examinees.

Star instructors' value in tens of billions of won, 'instructor poaching' and lawsuits

As the economic influence of star instructors grows, the competition for 'instructor poaching' among companies is also intensifying. According to secured contracts, some top-tier instructors who record number one in sales earn more than 10 billion won annually, receiving a 5 billion won contract fee over two years along with 35% of lecture sales and 90% of textbook sales. Companies compete by offering contract fees in the billions of won to secure star instructors.

In this process, dozens of lawsuits are occurring as instructors change jobs without completing their contract periods, or as companies bring in instructors from other places. In particular, the sudden job changes of instructors lead to the discontinuation of existing lectures, causing damage to examinees who face disruptions in their learning. Additionally, controversies over false advertising regarding the expression 'number one company' and subsequent counter-lawsuits, as well as excessive marketing competition using prizes, are also cited as causes for muddling the market.

Increasing consumer damage and concerns over declining educational quality

Although the market scale has grown, consumer damage is also increasing as companies focus on dominating the market through capital investment rather than the qualitative development of educational services. Damage reports related to online lectures received by the Korea Consumer Agency increased by 74% in five years, from 285 cases in 2011 to 497 cases in 2015. Analysis shows that excessive spending on marketing costs eventually leads to rising tuition fees, increasing the burden of private education costs.

Industry insiders are concerned that the high costs that should be invested in marketing are not being used to improve the quality of lectures. Contrary to the original intention of resolving educational gaps, if the dog-eat-dog competition occurring within the winner-take-all structure continues, the distrust and damage to examinees are expected to persist.