The Chosun recently reported a gloomy picture of the earnings of the Korean film industry. As Jon Pais speculated over at Twitch in November last year,
Even if production costs stabilized, as the number of films increases, decreased profitability is inevitable. But production costs are soaring and don’t show any signs of slowing down. In the first half of 2006, blockbusters aside, 40 films couldn’t even break even. This situation is only likely to worsen in 2007.
The Chosun confirms that picture. In an environment where profitability is uncertain, film investors want bankable stars, which of course boosts production costs further. As is well known in the case of Beyond the Years, even an internationally acclaimed director such as Im Kwon-taek doesn’t have complete control over casting if the money men don’t think the stars are big enough.
The Hankyoreh maybe identifies another aspect of the industry’s profitability: more screens, less profit. Looked at another way, a glut of poorer quality films aren’t necessarily going to generate as much revenue per film as a small number of better quality films. And it’s this message which is behind the unpopular viewpoint that the reduction in the screen quota might actually be a good thing for the Korean film industry. Could the free traders be right1?
Meanwhile there is a bright spot for the Korean content industry: the Hanyoreh reports that the period TV drama series Jumong is generating profits to match and probably exceed Dae Jang Geum. Revenues come not only from overseas sales but also from marketing add-ons such as men’s cosmetics (can you imagine a CSI aftershave?). Having learned from the DJG experience,
Experts say that Jumong had projected profits from exports and value-added businesses from its very begining. Dae Jang Geum added such profit-making plans without a prior plan in place.
reports the Hankyoreh. At 81 episodes though, I don’t think I’ll be buying the DVDs any time soon.
- Korea’s Film Industry: A Glance into the Future (Twitch, 24 Novemebr 2006)
- Korean Films Saw More Screens, Less Profits In 2006 (Hankyoreh, 19 January 2007)
- Potential Movie Industry Losses an Argument FOR US-Korea FTA (International Economics Study Center, 5 June 2006)
- Grady Hendrix on the screen quota reduction (Kaiju Shakedown, 26 January 2006)
- Movie Industry Coy About Massive Losses (Chosun Ilbo, 14 March 2007)
- Popular historical TV drama has raked in $50 million (Hankyoreh, 3 March 2007)
- Jumong blog
- Light the blue touch paper and run away…