Minister Choi Ki-young: "OTT Music Copyright Rates May Cause User Harm"

[Image source=Yonhap News]

[Asia Economy Reporter Seulgi Na Cho] "There could be user harm." On the 22nd, Choi Ki-young, Minister of Science and ICT, expressed concerns that user harm, such as fee increases of several thousand won, could become a reality regarding the music copyright rates that the online video service (OTT) industry is opposing.

Minister Choi stated at a video press conference held at the Sejong Finance Center in Sejong Special Self-Governing City in the afternoon, "There is an administrative lawsuit between the OTT industry and the Ministry of Culture, Sports and Tourism (MCST) regarding music copyright issues. Since there are issues among stakeholders, negotiations between the parties should also take place." He added, "There could be user harm related to this," and explained, "If possible, the Ministry of Science and ICT is trying to mediate and resolve the problem."

Domestic OTT companies such as Wavve, TVING, and Watcha have previously filed an administrative lawsuit earlier this month after the MCST announced OTT music copyright rates that were considered excessively high, with controversies over discrimination between identical services and double charging. The MCST's amendment aims to raise the OTT music copyright rate from 1.5% this year to 1.999% by 2026. However, it has been criticized for unclear standards, such as rates increasing several times depending on the platform even when watching the same terrestrial drama, and for being decided based on a committee's opinion that is significantly unfavorable to OTT companies.

On this day, Minister Choi also emphasized negative views on the increasing regulations targeting online platforms such as OTT, which are still in their early growth stages. He pointed out, "The principle of minimal regulation was agreed upon collectively by the Ministry of Science and ICT, the Korea Communications Commission, the Fair Trade Commission, and the MCST," adding, "Continuously creating new laws to increase regulations significantly is not desirable."

Regarding the criticism that there is a power struggle among government ministries over online platforms like OTT, he drew a clear line by saying, "This is not a conflict issue but a matter of creating synergy," and promised, "We will cooperate well." He added, "The Ministry of Science and ICT aims to minimize regulation and support growth, while the Fair Trade Commission and the Korea Communications Commission handle ex-post regulation. Their perspectives may differ slightly."

Concerning the 5G specialized networks provided to general companies, he marked the 3.5GHz adjacent frequency, which Naver, Samsung SDS, and others have shown interest in, as effectively "reserved for telecom operators." The 5G specialized network, which can be used only in specific areas such as buildings and factories, differs from enterprise 5G that leases 5G networks from the three mobile carriers; it allows companies to receive frequency allocations directly from the government and is also called "local 5G."

Minister Choi said, "The 28GHz band is possible for now," but emphasized, "The 3.5GHz band is for B2C use." He explained, "Regarding specialized networks, we are looking into bands below 6GHz. Although they cannot be used immediately, we are making provisions to utilize them as well." Network Policy Director Heo Sung-wook also stated, "The 3.5GHz band has been announced as a nationwide B2C band," and added, "According to forecasts from specialized institutions, mobile carriers will need additional frequencies starting from the end of 2022. Using the 3.5GHz band for a nationwide network rather than a limited specialized network will have greater value and efficiency in terms of radio wave utilization."

Regarding the introduction timing of the 5G specialized network, Minister Choi responded, "We will push to provide the 28GHz band frequency within this year," and added, "We will also strive to enable the use of other bands as soon as possible."

He was reserved about the profit-sharing system being promoted by the political sphere. Minister Choi said, "Even during COVID-19, the ICT sector's economic situation has been good, so discussions about profit sharing can naturally arise," and continued, "Looking further into the future, due to the digital transformation, some people may lose jobs, and some form of profit distribution will be necessary." However, he added, "Whether the government steps in or companies voluntarily take action, there are various paths," and said, "It is not appropriate for me to specify exactly what kind of system should be created."

Regarding LG Electronics, which is considering withdrawing from the smartphone business, he said, "There has been no official statement from the company yet," and responded, "We are aware of the difficulties in the mobile phone business and are internally reviewing what can be done."

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