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Small South Korean Production Companies Launch Joint Distribution Firm

League of underdogs to fight market oligarchy by industry giants through creating healthier distribution channels.

SEOUL — Ten South Korean production companies have teamed up to launch a joint investment/distribution firm, the Korean Film Producers Association (KFPA) announced Monday. This is the first time that smaller companies are joining forces against industry giants.

The country’s top three distribution companies CJ CGV, Lotte Cinema, and Showbox/Mediaplex account for 70 percent of the nationwide theater seat occupancy rate and 51.3 percent of the market share. Multiplexes would for example devote a majority of its screens to films produced by their parent company. Another prevalent problem, KFPA says, is how distribution companies have been charged for digital projector lease fees, which should really be paid by the cinemas.

Ten production firms including Myung Films, Chungeorahm Film, JupiterFilm, and Filmmaker R & K, have thus each contributed about $47,400 (50 million won) to set up Little Big Pictures. The KFPA says it plans to invite more members to amass funds of about $1.9 million (2 billion won) and distribute three films per year.

There are no plans to operate its own theaters, but Little Big Pictures has invested part of its funds and advance payment in the Busan Film Fund and Korean Film Fund.

"Little Big Pictures is a joint venture by the Korean film industry. We hope to lead the local film market toward a more reasonable and future-oriented direction by dividing profits in a fair way for production companies," said Lee Eun, CEO of Myung Films and head of KFPA.

KFPA recently won a lawsuit against the country’s major multiplex theaters. CJ CGV, Lotte Cinema, Showbox/Mediaplex, and Primus Cinema were ordered by the Seoul Central District Court to pay some $2.9 million (3.1 billion won) to 23 investment/production companies for handing out complimentary tickets without the latter’s consent.