In the End, the Government Will Propose a Mediation Plan... Failed CJ ENM-D'Live Subscription Fee Agreement

[Asia Economy Reporter Joesulgina] CJ ENM and cable TV operator D'Live, who have been in conflict over program usage fees, have ultimately failed in their voluntary negotiations. The matter now moves to the Ministry of Science and ICT. Both parties must follow the government's mediation proposal as previously agreed.

On the 1st, the Ministry of Science and ICT announced that since CJ ENM and D'Live failed to reach an agreement on program usage fees by the written agreement negotiation deadline the previous night, it is expected to release an official stance on the mediation plan as early as today.

Options under consideration include making a final decision after gathering opinions from both companies, forming an advisory committee to decide, or entrusting mediation to an external expert committee. The most likely step is to reflect the opinions of external experts such as professors and legal professionals after hearing from the operators. A Ministry of Science and ICT official stated, "In case of failure to reach an agreement, we have prepared a roadmap for smooth mediation," and added, "We will soon announce an official position."

CJ ENM and D'Live have been clashing over the extent and calculation method of program usage fee increases. After D'Live rejected CJ ENM's 20% increase request in March, tensions escalated to the point where CJ ENM threatened a blackout in July of the same year. Eventually, the Ministry of Science and ICT intervened as a mediator, and CJ ENM and D'Live agreed to follow the government's mediation proposal if no written agreement was reached by the 31st of last month. Program usage fees refer to the reception fees paid by comprehensive cable TV operators (SO) to channel providers (PP).

Although about a month of voluntary negotiations ended in failure, the feared blackout did not occur. The agreement at the time included a provision for D'Live to continue broadcasting CJ ENM's channels during the negotiation period. Furthermore, since both parties agreed to accept the government's mediation proposal, the possibility of this issue escalating into a legal dispute is virtually nonexistent.

The key question is whether the Ministry of Science and ICT's mediation proposal can find a level acceptable to both sides. After months of heated conflict, both companies need justification to accept the mediation proposal on the government's established framework. If the increase rate is decided below the 20% claimed by CJ ENM, which side gains more influence will also be crucial. Both parties agreed to an increase in program usage fees but still have significant disagreements over the specific rate of increase.

Industry insiders believe the government's mediation proposal is more likely to favor D'Live. An industry source conveyed the atmosphere, saying, "Compared to CJ ENM, which took the strong stance of a blackout, paid broadcasting and cable operators were likely judged to be relatively small-scale." This mediation could lead to expanded direct government involvement in future disputes between SOs, terrestrial broadcasters, and PPs.

CJ ENM and D'Live plan to continue discussions until the government's mediation proposal is finalized.

This content was produced with the assistance of AI translation services.