Is it possible to cut movie ticket prices and regulate OTT holdback?
In April, ‘Rebound’ and 3 other films were released… last game
What is the solution to the ‘theater/Korean film crisis’ from the perspective of the industry?
[포커스]①Is the theater the problem? Crisis leads to the article.
since when The time when reporters asked each other’s impressions, “How did you watch it?” after the media preview of a movie about to be released. In the past year, when was the last time you felt the excitement and joy when the screen went up after a premiere? In the past, there were quite a few times when I saw a great movie and wanted to quickly convey my impressions in an article. Watching movies and writing articles used to be quite doable, but now it’s not easy. The number of films that do not write reviews even after watching them has increased. This is a story shared by several film journalists recently. This is because many troubles pass by.
why, what is the problem It was not convincing to simply dismiss it as a market change. How can the film industry and the theater survive? We had to listen to the voices of the field. Summarize issues in the industry and listen to their voices.
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“Theatrical movie weekend 15,000 won… The admission fee is expensive”
The three major domestic multiplex companies (CGV, Lotte Cinema, and Megabox) have raised movie ticket prices three times since the COVID-19 pandemic. Currently, the ticket price is 14,000 won on weekdays and 15,000 won on weekends, including Fridays. Compared to before the pandemic, it has risen by 4,000 won.
The rise in ticket prices has become a key issue. Some point out the high admission fee as the cause of the recent crisis in the film market and argue that it should be lowered again. This is because the monthly subscription fee for online video service (OTT) is equal to the cost of viewing a movie. The audience has no choice but to compare the two values. Some in the industry argue that the admission fee should be lowered in order to lower the audience’s entry barrier to the theater.
The audience I met at the theater agreed that the price of a movie ticket is a burden. Lee Jun-hyeong (28, male), whom I recently met at CGV Yongsan I-Park Mall in Yongsan-gu, Seoul, said, “To watch a movie with my girlfriend on the weekend, the admission fee alone is 30,000 won, and it costs more than 100,000 won to eat, drink tea and eat popcorn.” There is a Sana card discount, but it’s not really helpful because I’ve been using it before the ticket price went up. Now, going to the theater is burdensome.”
Park Joo-yeon (30, female) said, “I tend to watch movies on weekends, but the admission fee of 15,000 won is a burden. In the past, sometimes if a movie wasn’t interesting, I didn’t think much of it. There are times when it’s regrettable. Also, since the theater fee is the same as the OTT subscription fee for a month, I have no choice but to compare it.”
The industry is well aware of this atmosphere. A person from an investment distribution company sighed, saying, “The audience these days is cold.” He continued, “Over the past three years, audiences who have been watching high-quality content through OTT at home have raised their eyesight.”
Photo = Reporter Kang Jin-hyeong aymsdream@
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Director Choi Dong-hoon (53) openly suggested lowering the ticket price. At the director’s chair event held on the 21st of last month, director Choi said, “Some say that with the advent of OTT, the number of theatergoers is decreasing, but I don’t think so.” He continued, “Theater’s competitive subject is OTT, but it is also a different cultural life. Maybe they are looking for the cultural richness they felt at the theater before in another place.”
“I think we need to lower the price of movie tickets in theaters. It is said that China has reduced the price of admission by about 500 won after the COVID-19 pandemic. That is a very important signal. ‘Everyone, it’s been hard so far, but now we’ve lowered the price, so please watch the movie’ Isn’t it necessary? Shouldn’t we think and work hard about theater issues?”(Choi Dong-hun)
Reduced theater fees, is it feasible?
Photo = Reporter Moon Ho-nam munonam@
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Is it possible to cut movie ticket prices once raised? Theaters are in the position that there is no reason to oppose it, because the price was always going to rise, and if the ticket price increases, the break-even point (BEP) can be lowered.
Kim Jin-seon (51), head of the Korea Cinema Industry Association, asked back, “If the theater price goes down, will the audience be satisfied and the number of audience members will increase?” gathered,” he said. She continued, “Wouldn’t it be fine if we had the mission of producing quality films and reciprocated with good theatrical content? I don’t want to sell cultural products.” She also added, “Theaters should consider investing billions of dollars in special theaters to give audiences a new experience.”
Kim, the head of the association, said, “I understand the opinion that it is sudden because the price has been raised three times within three years after the pandemic.” Are the current theater prices reasonable? He said, “It is the cost of creating worthy content and the cost of creating a space to showcase content. I don’t think it’s expensive. Producers also responded positively to the impression. In that respect, it’s the right price to make good content well.” . “Domestic theaters lose operating costs such as labor costs, gas and electricity charges, and rent if the number of annual audiences is less than 150 million. As the film production environment has changed, production costs have also risen,” he explained.
“Cinema theaters are dying. Will audiences flock to them just because they unconditionally lower the price? Wouldn’t there be a problem that can be solved by setting the admission fee differently by different time zones and classes? Also, each theater has various events and discounts. I think it is important to think about the role of developing things into marketing and return them to customers, and to constantly communicate so that audiences can enter the theater.”
AMC, a multiplex chain in the US, has a policy of different movie tickets depending on seat location during the evening hours. Seats in the front are 1 to 2 dollars (1,300 to 2,600 won) cheaper, and seats in the middle are more expensive. In addition, there is an atmosphere of expanding differential policies, such as setting the admission fee for the first weekend of anticipated blockbuster release higher than usual.
Waited for OTT? Is holdback regulation possible?
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“Last year, there are very few movies I saw in theaters. If you wait a little bit, it will be released on OTT anyway. Now, it seems that you do not have to go to the theater to wait and see it on OTT.”
Heo Mi-dam (27, female), who we met in a place in Seoul, cited OTT as the reason for not watching movies in theaters last year. Audiences in their 10s and 20s have a low perception that ‘movies must be seen in theaters’. It is analyzed that after the Corona 19 pandemic, she has experienced enough fun and high-quality content at home. With a cell phone, laptop, and smart TV, you can watch the movie comfortably at home, and even buses and subways become theaters.
An official from an investment distributor said, “Previously, if we adjusted the release schedules of other distributors so that they do not overlap, now we have to refer to the OTT main content release schedule. It’s a watching atmosphere. If the interest is focused on OTT and dramas, it is difficult to diversify to theaters.”
Another reason is that the ‘holdback’ (the period required for a movie to be screened in theaters and released as a video) from theatrical screening to OTT release has been shortened. The films ‘Emergency Declaration’ and ‘Hansan: The Emergence of the Dragon’, which were released last year, were released on Coupang Play four weeks after the theatrical screening.
C, a film official, said, “In the case of a flagship film, we discuss with the OTT side about disclosure ahead of the release. We set the release date after release, which has the effect of lowering the break-even point (BEP). This is a new marketing method after the pandemic. one of” he said.
In January of last year, France negotiated with the OTT platform to shorten the SVOD (Subscription VOD) holdback period from 36 months to 15 months after screening in theaters. This is a condition for OTT to invest about 4 million euros (56.0576 billion won) and produce more than 10 local films per year. Netflix responded, but Disney+ did not.
Kim Jin-seon, head of the association, said, “Like France, we must collect 3% and return it to the fund for the local film industry. “The first thing is to save Korean movies,” he said. “It comes out on OTT and IPTV in 8 weeks, but there is a reason why the audience does not come to the theater because they are waiting for it.”
“All Korean movies are dying because of OTT, such as Netflix. It is ironic that the government gave a lot of subsidies knowingly and allowed OTT to conduct its own review. It is necessary to put off contractual relations with distributors or make efforts to normalize holdbacks again. Wouldn’t it?” (Kim, president of the association)
Opinion “Film is an industry, government support is needed”
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The Korea Cinema Industry Association urged government intervention. The fund is a public fund created by investing the budget of the Ministry of Culture, Sports and Tourism and the Film Promotion Committee. It is a method in which the government invests in venture capital to foster small and medium-sized venture companies. According to the Ministry of SMEs and Startups on the 7th, it announced that it would invest 684.5 billion won through the 2023 2nd scheduled investment announcement with eight ministries. The Ministry of Culture, Sports and Tourism will invest 67.5 billion won to create a low- to mid-budget Korean film investment fund of 40 billion won (investment in the film development fund of the Film Promotion Committee). The management agency, Korea Venture Investment, prohibits the investment of the fund of funds in the production of films in which investment distributors affiliated with large conglomerates participate.
Kim Jin-seon, head of the association, said, “The size of the fund has decreased,” and said, “The ratio of movie investment that does not generate returns is a structure that has no choice but to decrease.” “The operating loss of major theaters in Korea is an astronomical amount. Wouldn’t it recover after about 10 years? Theaters have a bad credit rating, so they can’t even lend. Considering this, the limit on investment by large companies in the fund is temporarily lifted, or it is a policy fund. I urged you to implement an activation policy that opens up funds to be repaid and used.”
Chairman Kim also urged, “Please, even temporarily, recognize Korean films as art under the tax law and receive tax exemption from value-added tax.” The scope of creative works of art exempted from VAT includes creative works such as art, music, and photography, non-profit art and cultural events, and amateur sports events. Since 2015, the tax law has been revised, and creative performances such as musicals and plays have also been recognized as arts under the tax law and received tax exemption benefits. The head of the association said, “If Korean films are recognized as artistic creations and 10% tax exemption is given, it will help to revive the stagnant market.”
April-June Korean movie ‘The Last Match’
It’s dim, but the fire is alive. Japanese animations such as ‘The First Slam Dunk’ and ‘Suzume’s Lockdown’ gathered audiences through word of mouth and kept the fire burning. Now, the homework of the film industry is how to keep it burning without extinguishing it.
The industry agrees that April to June is an important period. In May of last year, ‘Criminal City 2’ attracted 10 million viewers, and in June, ‘Top Gun: Maverick’ also raised the upward trend. Expectations are high that Korean films will come back to life if ‘Rebound’ (director Jang Hang-jun), ‘Killing Romance’ (director Lee Won-seok), and ‘Dream’ (director Lee Byung-hun), which will be released next month, do well. In May, Hollywood movies ‘Guardians of the Galaxy 3’, ‘The Little Mermaid’ and ‘Fast and Furious: Ride or Die’ will be released. With this as a stepping stone, the atmosphere is closely watching whether the momentum will continue into the summer market from June to August.
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A movie official said, “It is important to see how the movies released in April receive responses. We need to hold tight so that theatergoers who have seen the movie do not compare the OTT subscription fee and the movie ticket price again. “There is no way to change the current stalemate without actively finding a way to regain the lost trust of the audience. If money continues to circulate in OTT content production as it is now, it will be difficult to continue investing in movies.”
Mr. E, a high-ranking official of the investment distribution company, emphasized, “The film industry must come together with a sense of desperation,” and “the current situation will not change with efforts in one field.” He continued, “Complex problem factors are connected like cogs. We need to sympathize with this and put all our efforts together, including theaters, distribution, and production. We have to make efforts from various angles so that audiences can flock to theaters again. This year is the ‘last chance’. “We have to work together with a desperate heart,” he said.
Mr. F, the CEO of the production company, said, “Audiences and viewers are smart. Both theater and OTT content can be found out in half a day if they are fun or not. Naked monitors are uploaded through SNS). The admission fee is not the same as before, and a culture of actively sharing personal criticism has been formed. Good movies ride on word of mouth, and boring movies ride on bad rumors.”
“Haven’t bookstores been looking for solutions while facing changes in the online and offline markets? Wouldn’t it be one way for the theater and film industry to accept these changes as a natural flow that cannot be resisted? A way for the film industry to coexist with theaters and OTT as soon as possible The most important thing is awareness and effort to make quality content and fun movies. If ‘awesome’ content comes out, there is hope. Circumstances can change at any time. The important thing is the unbreakable heart.”
Reporter Lee Seul [email protected]
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