With the Korea Media and Communications Commission (KMCC) establishing a six-Commissioner structure six months after its launch, attention is focusing on whether Public Home Shopping and Home&Shopping will secure T-commerce licenses. The conditions are now in place to resume policy discussions that had been effectively stalled due to a lack of a voting quorum.
The authority over T-commerce channel licensing and related policies was transferred in Feb. from the Ministry of Science and ICT to the Korea Media and Communications Commission (KMCC), which oversees broadcasting, media, and communications policy.
However, it is expected to take more time before the actual process to solicit operators gets underway. That is because the Korea Media and Communications Commission (KMCC) faces a backlog of other pending issues.
The Korea Media and Communications Commission (KMCC) held its first full meeting on the 10th, but the agenda item to create new T-commerce channels was not included in the schedule. The focus was on managing existing operators and refining systems, including terrestrial relicensing, cable TV relicensing, the basic plan for pay-TV relicensing and reapproval, and review plans for reapproving existing home shopping and data home shopping operators.
An official at the Korea Media and Communications Commission (KMCC) said, "At this point, there is no specifically determined policy direction."
◇ Profitability worsens and management voids pile up at SME-focused home shopping firms… hoping T-commerce opens a path
Public Home Shopping and Home&Shopping recently appointed Lee Il-yong and Kwon Jin-mi as CEOs, respectively, reorganizing their management structures. The immediate task for the new leaders is to improve deteriorating profitability.
Public Home Shopping returned to the black last year with 800 million won in operating profit, but most of its gross profit is consumed by SG&A expenses. Home&Shopping has also seen both sales and operating profit decline every year since 2022.
A decline in TV viewership and rising carriage fees are cited as structural burdens across the industry. According to the Korea TV Home Shopping Association, carriage fees as a share of broadcast sales rose from 54.2% in 2020 to 71% last year.
The companies' structural requirement to meet programming quotas for small merchants' products also adds pressure. Public Home Shopping must fill 100% of the products it carries with small merchants' items, and Home&Shopping must fill at least 80%.
T-commerce is cited as a realistic breakthrough for both companies, as they can leverage existing facilities to expect an additional 200 billion–300 billion won in sales. Among domestic home shopping operators, only Public Home Shopping and Home&Shopping do not have T-commerce channels.
Given the prolonged management vacancies at both companies, there is also a strong need to rebound by securing new business.
Public Home Shopping had its CEO post vacant for about one year and six months due to a change in administration and delayed appointments, and Home&Shopping also saw key decision-making delayed as an acting CEO system continued after the previous CEO resigned.
◇ 92% of small merchants say they would use a dedicated channel if launched
Unlike live broadcast–centered TV home shopping, T-commerce operates on a recorded basis, making production and operating costs relatively lower. Consumers can choose not only items being aired but also other items shown on the screen, suggesting it could be used as an additional sales channel for small merchants.
The industry expects that if artificial intelligence (AI)–based video production technology spreads, T-commerce content production expense will fall further.
According to a survey by the Korea Federation of Small and Medium Enterprises of 856 small merchants that do business with TV home shopping and T-commerce, if a dedicated T-commerce channel is launched, 46.0% answered "would use," and 46.0% said "will review later," showing that 92% have potential intent to use. Only 7.8% said "would not use."
As for expected benefits of introducing a new channel, "lowering expenses such as sales commissions compared with existing T-commerce" ranked highest at 46.8%, followed by "expanding sales channels through eased entry barriers" and "more opportunities for broadcast programming."
Intent to use was relatively higher among manufacturing (49.8%) and corporations with sales of at least 10 billion won (53.3%), with notable demand by category in apparel and accessories (65.5%) and sports and leisure (66.7%).
◇ T-commerce launch included in national agenda… operator bidding expected around 2028
Public Home Shopping and Home&Shopping are said to have been preparing business proposals through dedicated teams since last year. The Lee Jae-myung administration made the launch of a T-commerce channel dedicated to small merchants a national agenda item.
At a year-end briefing last year, Public Home Shopping's acting CEO Kim Young-ju directly asked President Lee to "please make it happen" and approve the business license. President Lee replied, "Because it is a matter under competition, it could cause misunderstanding," but added, "That sense of urgency will be conveyed."
In the industry, even if the Korea Media and Communications Commission (KMCC) presents a direction to launch a new channel within the year, after public hearings and consultations with related ministries, bidding for operators is expected to be possible only around 2028.
In the meantime, the two companies are expected to engage in fierce behind-the-scenes competition over securing the license. Public Home Shopping is emphasizing its public-interest role by highlighting that it is a public institution under the Ministry of SMEs and Startups. Home&Shopping is putting forward its identity as a "channel specializing in small and medium-sized corporations," based on a structure in which the Korea Federation of Small and Medium Enterprises is the largest shareholder.
Some suggest that multiple operators could be approved simultaneously depending on policy needs. An industry official noted, "They may not allow only one new channel and could open the way for both."