The unilateral push for an increase in the 'music copyright fee' by the Korea Music Copyright Association (hereinafter referred to as 'Music Copyright Association') will strike a heavy blow to the paid broadcasting industry. In the case of comprehensive wired broadcasting companies (SO), the music copyright fee could increase by more than 10 times, and for IPTV broadcasting, it could rise by more than 2.5 times.
At a press conference held on the 7th by the Korea Cable TV Association regarding the push for amendments to the Music Copyright Association's music copyright fee collection regulations, representatives from the Korea IPTV Association, the Korea Broadcasting Channel Promotion Association, the SO Council, and the PP Council in the paid broadcasting industry expressed their concerns in unison.
They noted, "The sharp increase in music copyright fees will dampen the production and distribution market of domestic K-content," and stressed that "considering the current situation in the domestic paid broadcasting market, it could lead to chaos throughout the market."
Their concerns stem from the fact that the Music Copyright Association is currently pushing for amendments to the collection regulations for increasing music copyright fees. The amendment plan includes not only an increase in usage rates but also provisions to expand the revenue range of paid broadcasters, which serves as the basis for calculating copyright fees. The industry anticipates that if this amendment passes, the music copyright fees paid by broadcasting companies will increase significantly.
Initially, the Music Copyright Association collected 0.5% of the revenue of comprehensive wired broadcasters (SO) that used music as the copyright fee, but the amendment plan includes a provision to raise this to 1.5%. For internet TV (IPTV), the existing music usage rate of 1.2% will be increased to 1.7% under the amendment plan. Additionally, it has been decided to include unrelated streaming fees for home shopping, installation fees for broadcast facilities upon subscribing to paid broadcasting, and lending fees for devices in the revenue range applicable to the calculation formula. As revenue increases, the copyright fees imposed on broadcasters also escalate. Moreover, the proposal deletes the deduction coefficient that previously allowed for some revenue deductions, creating a structure that increases revenue. For example, while the existing IPTV broadcasting revenue was reduced by multiplying it by an adjustment coefficient of 0.47, the amendment does not reflect this adjustment coefficient.
Chairperson Hwang Kyung-il of the Korea Cable TV Association's PP Council strongly criticized, saying, "Despite being a market-dominant player with an absolute share of 67.5% based on the number of managed works and 99% based on the amount of broadcast usage fees collected, the Music Copyright Association fails to demonstrate the fairness and responsible attitude that corresponds to such dominance."
Chairperson Hwang said, "The Music Copyright Association is attempting to calculate the rate based on external revenue figures from the 'property financial statement' unrelated to music usage," and added, "They are unreasonably including items such as home shopping streaming fees, installation and facility setup fees, and lending fees for devices, which have never been reflected before, despite being unrelated to music." He added, "This distorts the essence of copyright fees, which is 'compensation for the use of copyrighted works,' and could significantly undermine the rationality and fairness of the calculation method."
The Head of Team Baek Dae-min of the Korea IPTV Association criticized the Music Copyright Association's amendment plan, saying, "It is pushing for excessive increases unilaterally, ignoring existing agreements."
He pointed out that "if this increase plan is accepted, the annual music copyright fee increase for IPTV will rise by 2.5 times compared to before," stressing that "this could undermine the will of users who strive to grow the broadcasting industry and contradict the basic purpose of copyright law aimed at nurturing the cultural industry."
Deputy Minister Han Sang-hyeok of the Korea Cable TV Association's SO Council stated, "The adjustment coefficient was the minimum safety measure to mitigate the industrial shock caused by the sharp rise in copyright fees," and added, "To pursue unilateral increases in copyright fees without acknowledging this directly contradicts the legislative goal of copyright law, which is 'the development of related industries,' as stated in Article 1 of copyright law." He expressed concern, stating, "For the SO industry, an excessive increase in music copyright fees of at least 10 times compared to before is expected, which will inevitably act as a severe burden."
Meanwhile, the Music Copyright Association holds the position that the music copyright fee usage rates collected from paid broadcasters in Korea are lower than those in developed countries. They argue that there is a significant gap compared to countries like France (5%), Canada (1.9%), and Japan (1.5%). The amendment plan regarding the collection of music copyright fees by the Music Copyright Association is expected to be finalized after deliberations by the Ministry of Culture, Sports and Tourism and the Copyright Commission.