Behind the Movies
Behind the Movies
  • Lee Ga-eun (ST Reporter)
  • 승인 2020.04.09 14:26
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Last year, 10 million viewers’ movies were literally poured out. All of them were excellent. But, is that the only reason behind these great success stories? None of them could avoid the debates on the screen monopoly. From screen monopoly to unique theaters that is screening independent and art movie! let ST guide you behind the screen of 10 million viewers’ movie.......................................Ed

     In 2019, there were many movies that drew at least 10 million viewers, including Avengers: End Game and Parasite. Thus, the controversy surrounding screen monopolies has emerged. Disney’s Frozen 2, one of the movies that drew at least 10 million viewers last year, was sued by a civic group for violating the law banning monopolies after getting 88 percent of movie screen share. The controversy over screen monopoly began with the release of the 2006 film, The Host. With many opinions that are at odds over this issue, as it is often mentioned, what is screen monopoly?
 

What is screen monopoly?

     Screen monopoly occurs when the share rate of a specific movie in movie theaters is excessively high during its release. To understand this screen monopoly, we need first to look at the content of these movies. Recently, people can watch movies through various OTT (over-the-top) services such as Netflix (which provides various media contents via the Internet) or IPTV (Internet Protocol Television). However, it is still common practice for movies to be released in theaters. About 600 films are released every year in Korea, or about three to as many as 10 films a week. Still, the number of theaters and screens is physically limited, as well as the content of movies. Consequently, as offline distribution networks remain active, the audience has very limited time to assess the content they offer. Then a number of films are shown in such a limited number of theaters. If you understand the nature of these movies, you can understand the problem with screen monopoly. In the end, some films are allocated many theaters and screen times, while others do not get the same treatment.

     Most films that are allocated a large number of theaters are distributed by big-budget film producers or major distributors. For example, Frozen 2, the most controversial movie when it comes to screen monopoly, attracted more than 600,000 viewers in one day, monopolizing 70 percent of the seats and 2,343 screens nationwide on the first day (2019.11.21) of its release in Korea (based on the data provided by the Korean Film Council). As of January 2020, there were 13,468 screenings of the aforementioned movie, showing a 62.5 percent share. On the other hand, in the case of independent or artistic films, their share of theaters was quite low. For example, House of Hummingbird, an independent Korean film that has proven its high quality after receiving more than 40 awards around the world, was released on August 29, 2019, and had a market share of 1.4 percent with 262 screens. Based on rough figures, Frozen 2 accounted for more than 50 percent of the share in theaters.

google.com
google.com
google.com
google.com

The cause: Vertical integration structure

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google.com

     The most significant reason for this phenomenon is the movie market’s “vertical integration structure.” Currently, the domestic film industry has steadily increased, making it the fifth largest movie market in the world as of 2018. The film industry is divided into four major categories: production, investment, distribution, and screenings. The production sector involves the process of producing films, from planning to completion, while the investment company provides funding for film production. The production company spends money to produce the film, and the distribution sector corresponds to the distribution stage, which is how a finished film is delivered to the consumer. The distributor buys the copyright of the film produced, and then sells or rents the film to theaters at a certain price. In particular, domestic distributors can invest in movies differently. That would allow major distributors to create a favorable screening environment for their own distributed movies. The distribution of Korean films is centered on four large distributors, marked by a huge gap of 86 percent and 14 percent (from 2008 to 2014), respectively, when considering the audience’s share with smaller distributors. Monopolies in the distribution sector have a huge impact on the Korean film industry because distribution is a key factor not only on screenings, but also in production and investment. 

     Thus, there is a vertical structure in investment/production-distribution-commissioning at home and abroad, and some even say that this constitutes unfair trade practice. On the one hand, since movie theaters are also private companies that seek “profit,” it may be practical to show movies that more viewers want to watch. The content of movies has different purposes, from the pure artistic to the commercial. Still, if the profit-making pursuit of distributors and large movie theaters deviates at some level, there will be problems with the options they present to the audience. Just as the demand for big, colorful films is natural, so is the demand for films with interesting themes, even if they are less popular, such as independent and artistic films. However, it is problematic when the audience is forced to forfeit their right to choose a movie even if they want to see a movie that suits their taste.

Awareness of screen monopoly

     To find out what Soongsilians think about these screen monopolies, ST conducted a brief survey. About 100 people were surveyed, and the results were as follows. About 93 percent of Soongsilian respondents said they were “exclusive” on whether or not blockbuster movies had a monopoly on screens. Also, when asked if they were ever bothered by screen monopolies, about 86 percent said, “Yes.”

*For more information, ST interviewed two students who were very interested in watching movies.

ST, Lee Ga-eun
ST, Lee Ga-eun


#Kang Su-hyeon  (Inha University, Cultural Contents and Management, 19) “I like movies enough to watch at least four movies a week. When I’m sad, when I’m happy, there are movies that I watch on Christmas and New Year. The fact that there are still many movies that I haven’t seen and that there are constantly great movies being made gives me so much motivation to live!”

 

 

 

 

ST, Yeom Da-yeon
ST, Yeom Da-yeon


#Kim Soo-yi  (Information Sociology, 17) “On average, I watch movies more than twice a week. I have been working part-time in a movie theater for eight months now! Last year, I was so interested in movies that I went to the Busan International Film Festival .”
 

 

 

 

 

ST: What is your opinion on screen monopoly?

Kang: I think screen monopoly is a natural result of capital. But now that I’m in a position to see and look at different types of movies, I think it’s a topic that must be taken seriously. I think there is a need to regulate the screen monopoly of major producers/distributors. There are many reasons, including difficulties faced by small and medium-sized production companies, the uniformization of genre or level of film, and the audience’s lack of options. In the case of the recent movie, Portrait of a Lady on Fire, the number of theaters was so small, and I waited a few more days to watch it. On the other hand, major distributors’ films enjoyed a majority of screens. The power of capital seems to make it almost impossible for audience to enjoy cultural diversity, and the Korean film industry will eventually be affected. The public has the right to choose the work they want to see. There are many different movies that each person can choose from.


Kim: I think there is definitely a screen monopoly, and we need to regulate it. While working at the movie theater, I felt there was more of a screen monopoly. Indeed, with more screens and better screening times being taken up by largely commercial films, small-scale, independent art films are left out of place. Even if a small movie is only allocated a screen, I don’t think it’s meaningful because it doesn’t get assigned multiple schedules, and only when it’s hard for regular workers or students to see it. I think this is a problem between the Korean film industry and the box office directors.
 

ST: What is the future direction or expectation to improve the Korean movie industry?

Kim: I think the Korean film industry needs to reduce the cultural gap between Seoul and the other provinces. It will be necessary to increase the number of local cinemas. There are few movie theaters in rural areas, so art movies are often not released at all. Even box office movies are often difficult to catch there. So I think narrowing the cultural gap could be the first step in screen monopoly regulation. With this improvement, the Korean film industry will be moving in the right direction.
 

Kang: At some point, I started not to look for Korean movies, and I saw them without much expectation. It is because I think the content of the movie will be similar only to the actors. But when I think of the movie that made me cry and laugh the most, I think of the faces of Korean actors. It’s a strength that only homegrown movies can have. I also felt that great filmmakers were working in Korea after seeing widely recognized works like Parasite and House of Hummingbird. I hope that they will be able to earn more recognition, and do their best in their works. Also, I hope that the audience will be able to watch the movie that they want to see. Let’s hope Korean movies can represent the stories of more diverse people and deliver them to the world beyond Korea.
 

Screen monopoly: Overseas Regulatory Case

     Screen monopolies can bring about infringement of the audience’s options and uniformization in the movie industry. So, does this screen monopoly problem exist only in Korea? Let’s take a look at the situation in the U.S., which has the largest movie market in the world. Avengers: Endgame hit $850 million, finishing second in the all-time North American box office. However, there is a big difference between Korean and American box office success. In Korea, if most theaters were hit with a record number of screen monopolies, it would have been a success in the U.S. without disrupting the screening of other films at relatively few theaters. On the first weekend (April 26-28), Avengers: Endgame sales stood at 88.8 percent of the North American box office. The number of theaters, however, stood at only 4,662 out of the total of 33,726 theaters. In terms of percentage, the figure is about 13.8 percent. The screen share is estimated to be between 26 and 27%.  In the U.S., other movies were not interrupted. While audiences were flocking to one film, just like in Korea, other films secured a certain number of theaters to find its audience. That is because of the strict U.S. standards on monopoly. They see the film industry as a cultural standard that values diversity, not the market logic of supply and demand. The restrictions on monopolies in the U.S. film industry are based on the 1948 “Paramount Consent Decrees.” In the “Paramount Consent Decrees,” the U.S. Supreme Court ordered the sale of theaters owned by major studios. Later, the U.S. prevented screen monopolies through regulations called “sliding scale payment.” The U.S. Ticket Revenue Sharing Rate (the rate at which theaters and distributors share profits) is not fixed, but it is fluctuating, as in Korea. The share the theater takes in the first week is quite small, but if a movie lasts more than three to four weeks, the theater takes a larger share. Therefore, there is no need to give up many theaters in the first week when there is not much profit. Instead, it is advantageous to show the movie for a longer time since the theater stands to make more money from ticket sales.

     What about France, another movie industry powerhouse? The most recent agreement on the compilation of film programs was signed on May 13, 2016. This agreement considers banning theaters with more than six screens if the duration of a particular film release overlaps by more than a third of the total. The CNC(Centre National du Cinéma et de l’image animée) serves as a simultaneous distribution oversight body. The upper limit of simultaneous distribution will be set by the number of screens distributing one film at the same time and the number of screens distributing multiple films at the same time to guarantee the screening of different films. Furthermore, the proportion of screenings allocated to European and minority films should be expressed as a percentage of the total number of screenings, and, for at least two weeks, each film must have a regular run in France.

Screen monopoly: What is the current direction in Korea?

     A bill is being proposed in Korea to regulate screen monopolies. As of January 2020, the “Revised Act on the Promotion of Movies and Videos,” proposed by Do Jong-hwan, a lawmaker from the ruling Democratic Party of Korea, in 2016, is currently pending in the National Assembly. First, the distribution and screening of films from major companies are prohibited. Second, one or more theaters dedicated to art films and independent films are designated in a cinema complex. Third, support projects for exclusive theaters for movie development fund must be included. Fourth, the mandatory allocation of a fair number of theaters must consider the number of viewers per hour and per day, and the number of hours and days per week. The revision, as proposed by Rep. Cho Seung-rae from the Democratic Party of Korea in November 2017, is also pending at the National Assembly. The revision includes regulations that prevent managers of theaters owned by conglomerates from showing the same movies in excess of a 40 percent share. In May 2019, Woo Sang-ho from the Democratic Party of Korea proposed another revision, in which a movie’s screen share must not exceed 50 percent by specifying the prime time (1 p.m. to 11 p.m.) that attracts the highest audience. Still, the controversy persists because no bills have been passed.
 

Screen monopoly: What is the current direction in Korea?

     A bill is being proposed in Korea to regulate screen monopolies. As of January 2020, the “Revised Act on the Promotion of Movies and Videos,” proposed by Do Jong-hwan, a lawmaker from the ruling Democratic Party of Korea, in 2016, is currently pending in the National Assembly. First, the distribution and screening of films from major companies are prohibited. Second, one or more theaters dedicated to art films and independent films are designated in a cinema complex. Third, support projects for exclusive theaters for movie development fund must be included. Fourth, the mandatory allocation of a fair number of theaters must consider the number of viewers per hour and per day, and the number of hours and days per week. The revision, as proposed by Rep. Cho Seung-rae from the Democratic Party of Korea in November 2017, is also pending at the National Assembly. The revision includes regulations that prevent managers of theaters owned by conglomerates from showing the same movies in excess of a 40 percent share. In May 2019, Woo Sang-ho from the Democratic Party of Korea proposed another revision, in which a movie’s screen share must not exceed 50 percent by specifying the prime time (1 p.m. to 11 p.m.) that attracts the highest audience. Still, the controversy persists because no bills have been passed.
     Diversity of Movies vs. Market Autonomy To sum up, screen monopolies are hurting creativity and diversity of movies, and are encroaching on the audience’s choice by focusing on specific movies due to the conglomerate-centered vertical system of distribution and screening. Considering the special nature of the film industry, however, it is also necessary to ensure the autonomy of the market as much as possible, rather than the active intervention of the state. Rather, strong regulations can affect the movie market. This is the reason no bills have been finalized so far. It is also necessary to have an appropriate venue for independent and artistic films. Since the controversy over screen monopoly has persisted for more than a decade, the film industry should be fair. It is important to keep in mind that if there is an opportunity where people can watch different types of movies, the domestic market can significantly boost the credibility of audiences’ confidence.

What if you want to see an independent/art movie?

     As mentioned earlier, one of the problems with screen monopolies is the standardization of movie content. When it comes to the diversity of films, the focus must be on independent films and art films. In Korea, interest in independent and art films has been increasing over time. According to the results of a national recognition survey involving around 1,040 people about the Korean film industry in 2019, 83 percent said they were interested in independent and art films. Furthermore, 71 percent of viewers were inconvenienced by the absence of independent and art movie theaters. The lack of theaters has resulted in a selection that was not respected despite considerable demand. ST visited an art theater that screens movies in limited release because of major blockbusters or regular films. 

*Even during the period when Ashfall and Frozen 2 were in theaters, The Truth, Sorry We Missed You, and Pavarotti were also released. (As of January 2020)

ST, Lee Ga-eun
ST, Lee Ga-eun

1. CINECUBE

Location 68, Saemunan-ro, Jongno-gu, Seoul

Cinecube offers three principles in movie viewing etiquette. ✽First, bringing in drinks or food, except water, is prohibited. ✽Second, screen movies on time without advertising, and limit admission 10 minutes after the movie starts. ✽Third, wait until the end credits are over before turning on the theater’s lights.

 

 

ST, Yeom Da-yeon
ST, Yeom Da-yeon

2. ARTNINE

Location 89, Dongjak-daero, Dongjak-gu, Seoul

Every night on the last Friday of every month, ArtNine brings together three works for an all-night screening. On the last day of each month, at 9 a.m., complimentary film posters of movies that were screened during the month are available at ArtNine Hall. Cine France screens French films every Tuesday as part of its regular program, and has been hosting the “Mise-en-Scène Short Film Festival” since 2013.

 

 

ST, Lee Ga-eun
ST, Lee Ga-eun

3. CGV (Myeong-dong Station Cinema Library)

Location 123, Toegye-ro, Jung-gu, Seoul

Since Nov. 7, 2019, three regular theaters were transformed into art house rooms in addition to the existing two art house halls, bringing the total to five. To make it easier for viewers to see independent and artistic films, the company hosts many talk programs with movie critics and directors. Also, the “CGV Art House Curator” provides explanations after the screening of a movie.
 

 

ST, Lee Ga-eun
ST, Lee Ga-eun

4. INDIESPACE

Location 13, Donhwamun-ro, Jongno-gu, Seoul

Established in November 2007, it is the first independentfilm-only theater in South Korea. Though Indiespace shut down operations in December 2009, voluntary efforts led by the private sector, including a civic group, inspired its revival as it is now expanding as an independent movie theater. It reopened with no significant capital or wide public support, but with the help of filmmakers and film enthusiasts.
 

 

Yeom Da-yeon (ST Reporter)

ydy1213@soonsil.ac.kr

Lee Ga-eun (ST Reporter)

nameun33@soongsil.ac.kr


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