A comparative study: Performance of Hollywood and Korean sequel films in Korea

ABSTRACT

The film business is notoriously high risk. This paper investigates what types of films are successful by analyzing 1,539 films released between 2004 and 2009 in South Korea, whose consumption rate of domestic films is exceptionally high. Drawing from the literature on brand extension and country of origin, this paper demonstrates that sequels attract more box office audiences than non-sequels while Korean domestic films attract more audiences at the box office than Hollywood films.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

¹ In October 2006, the rate was similar at 85%. (Korean Film Council [KOFIC], 2013).

² Korean films went through industrialization during the 21^st century, as evidenced by conglomerates’ large capital investment in screens and domestic film production (Kim & Han, 2014).

³ The KOFIC statements of accounts regarding the Korean film industry are available online for the years 2003-present.

⁴ When it comes to expert reviews, valence ratings were significantly related to the U.S. box office revenue while the frequency was not (Kim et al., 2013).

⁵ In 2008, the U.S. film industry gathered a revenue of $18.3 billion from international markets while its total revenue was $28.1 billion (Motion Picture Association of America, Inc, 2009).

⁶ We checked for autocorrelation and multicollinearity, and the Durbin-Watson and Variance Inflation Factor statistics did not indicate any problems. As a robustness check we tested the four hypotheses using two Generalized Least Squares (GLS) models (one for analyses of all films and the other for analyses of sequel films), and found that the results were similar to our OLS results.

⁷ Also, the Korean film industry is drastically expanding in terms of the number of films produced, imported and released. Korean films produced, imported and released hit 78, 262 and 274 in 2002 compared to 113, 362 and 379 in 2008 (KOFIC, 2009).

⁸ While some scholars support the Screen Quota, other  scholars are against the Screen Quota, arguing that it limits competition and lowers the quality of Korean domestic films (N.C. Kim, 2007).

⁹ A few Hollywood studios successfully promoted their films in Korea. For instance, Robert Downey Jr. visited Korea to promote Iron Man, which turned out to be a big hit.

¹⁰ This custom has changed; information on revenues of film released after 2004 is now available at kobis.or.kr, a data center for films by KOFIC.

¹¹ The authors thank the anonymous reviewers for their comments.

Additional information

Funding

This work was supported by the Academy of Korean Studies (KSPS) Grant funded by the Korean Government (MOE) (AKS-2011-BAA-2102). This work was also supported by the Ministry of Education of the Republic of Korea and the National Research Foundation of Korea (NRF-2019S1A3A2099973)

Notes on contributors

Dam Hee Kim

Dam Hee Kim (Ph.D., University of Michigan) is an Assistant Professor in the Department of Communication at the University of Arizona. With her cross-disciplinary background in communication and business, her research focuses on engagement with news, politics and entertainment content in the evolving media environment.

Seongcheol Kim

Seongcheol Kim (Ph.D., Michigan State University)  is a Professor in the School of Media and Communication and the Director of Center for ICT and Society and Center for Media Industry. His research interests include Information and Communication Technologies management and policy.