Business integration and its impact on film industry: The case of Korean film policies from the 1960s until the present

Abstract

With increasing business integration in cultural industries around the world, it has often been debated whether this process is helpful or harmful. The experiences of the Korean film industry provide an important example in this regard. Over the course of Korea’s film industry, there have been three distinct periods of integration. This article analyses the causes, processes, and their effects. The first one was the result of strict regulations and strong government intervention. The latter two periods exhibit different characteristics: deregulation and pro-competition in a global setting. In fact, integration brought about rather positive effects to the industry when a business-friendly environment prevailed. Based on this study, the results show that integration can be used to enhance the competitiveness of a film industry. The analysis in this article can be useful toward providing a good reference point for establishing cultural policies for the film industry.

Keywords:

• Korean film
• Korean cinema
• film policy
• film industry
• business integration
• conglomerate
• Hallyu

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1 Korea was liberated from Japan in 1945 and the division in to north and south occurred in 1948. ‘Korea’ is used as a general term to refer to South Korea in this article.

2 Data vary depending on sources for the same period.

3 The definition of ‘quality’ is rather subjective and arbitrary. Still, quality in general can be defined from two perspectives: audience and critics. The audience perspective can be measured by number of admissions while critics’ perspective can be judged by the number of awards (or nominations) and movie reviews. When the Korean government developed its policies in the 1960s, there was no such distinction on quality. Even today, this term is still used in film policies without much distinction. Therefore, this article employs ‘quality’ and ‘attractive’ as a general descriptive term.

4 In Korea, importers distributed foreign films to regional distributors.

5 According to Kim (2007), 65 small film companies were consolidated into 17 large companies. Jwa and Lee (2006) provided more specific data: the numbers of small film companies were 71, 16, and 6 in 1959, 1962, and 1963, respectively.

6 In the 1970s, the prevalence of television emptied movie theatres. However, a series of deregulations increased the number of movie theatres in the 1980s despite the introduction of ­colour television. Hence, small-sized movie theatres or cinemas for less than 300 people was permitted in 1981, midnight screening debuted in 1982, and multi-screen movie theatres appeared in 1986. For further information, see Korean Film Archive.

7 It is noteworthy that not all the foreign films were distributed by the studios. Foreign studios distributed mostly top-tier films, whereas they sold the distribution rights of second- or third-tier foreign films to Korean companies.

8 Furthermore, as the large Korean companies were able to finance themselves with their own private investment, the role of regional distributors as investors significantly weakened. See Kim (2003).

9 CJ was a subsidiary of Samsung before breaking off in to a separate company in 1993.

10 Part of this open door approach was related to 1997 financial crisis. The government tried to attract more foreign investment in various sectors to overcome the crisis.

11 See Murschetz, Teichmann, and Karmasin (2018), Parc and Messerlin (2018b) and Kim, Martigane, and Parc (2019) for various distortions and disruptions in the film industry.

Additional information

Funding

This work was supported by Laboratory Program for Korean Studies through the Ministry of Education of Republic of Korea and Korean Studies Promotion Service of the Academy of Korean Studies (AKS-2015-LAB-2250003).

Notes on contributors

Jimmyn Parc

Jimmyn Parc, Ph.D. is Visiting Lecturer at the Institut d’Études Politiques de Paris (Sciences Po), France and a Research at the Institute of Communication Research, Seoul National University in Korea. He has published numerous academic articles and conducted a number of research projects related to the competitiveness of organizations, industries, and countries. For his main topic of research on the cultural and creative services industries, he uses historical and comparative approaches to understand international business strategies.