FTA could widen Korean window
EmptySEOUL -- South Korea's media markets can be expected to open even further thanks to the Free Trade Agreement reached Monday between South Korea and the U.S., with the television sector, intellectual property rules and the Internet all in for a shake-up.
Though details are still being worked about, major entertainment-related issues covered in the FTA include:
-- The expansion of copyright protection to 70 years, from the current 50.
-- The elimination of the 49% cap on foreign ownership of cable TV program providers.
-- A decrease in the local content requirements for program providers to 20% from 25%.
-- A stepping up of pressure on Internet service providers to protect intellectual property.
One of the most contentious issues in the entertainment industry -- a screen quota that requires all theaters in Korea to play local films a minimum of 73 days a year -- was resolved in early 2006 and was thus not a factor in the FTA.
Media company officials reacted hesitantly as details of the FTA seeped out, with Hollywood studios expressing optimism for the deal and local companies taking a more ambivalent outlook.
"It's good to know this is finally getting done," said Steve Pak, executive director of sales at Buena Vista Korea. "It will affect TV more than film, but it should open the TV market wider."
Privately, industry insiders say the lifting of foreign ownership restrictions on TV program providers is the biggest part of the deal but that a flood of foreign content into Korea should not be expected immediately.
"Not all media groups will be interested in launching local branches here. They'll still have to research the local market and see if there is value here," one local executive for a major U.S. studio said. "But it will make an impact. It will take a few months, even a few years, but when the new regulations kick in, they should be a good incentive."
Though the FTA could add $20 billion in bilateral trade within the next three years to the two countries' $78 billion trade relationship, media is a relatively minor part of the trade pact, which focuses more on categories such as cars, agriculture and textiles.
"This is very good news," said Brendon Carr, an American lawyer who works for the Seoul-based law firm Hwang Mok Park. "Korea is getting a pretty good deal."