"Paid Broadcasting Reauthorization Abolished and 1 Trillion Fund... Special Measures Against Netflix's Dominance"

Prime Minister-led Announcement on 'Media Content Industry Development'
Increased Tax Benefits and a 1 Trillion Won Public-Private Joint Fund
Abolition of Market Share Regulations and Relaxation of Broadcast Advertising Restrictions

The government has announced drastic measures to revitalize the media and content market, which is being dominated by giant global companies such as Netflix.

The tax credit rate for video content production costs will be increased up to 30%, and a public-private joint fund worth over 1 trillion won will be established. The government will also improve outdated regulations by abolishing the paid broadcasting re-licensing system and market share restrictions.

On the 13th, the Media and Content Industry Development Committee held a plenary meeting chaired by Prime Minister Han Duck-soo at the Government Seoul Office and announced the "Media and Content Industry Convergence Development Plan."

As seen in works like "Squid Game" and "The Glory," domestic content competitiveness is at a world-class level. However, the media industry?including film, broadcasting, and OTT?has experienced stagnation or deficits. Accordingly, the committee discussed with the industry to explore policy measures that would enable the media and content industry to become a new engine of economic growth.

Tax Credit Rate for Production Costs Increased up to 30%

First, the tax credit rate for video content production costs will be expanded up to 30%. The basic credit rate will be raised to 5% for large enterprises, 10% for mid-sized companies, and 15% for small and medium enterprises (SMEs). An additional credit of 10% for large and mid-sized companies and 15% for SMEs will be introduced if a high proportion of expenses are incurred domestically.

Additionally, to support competitive large-scale content production and assist domestic production companies in utilizing content IP, a public-private joint "K-Content and Media Strategic Fund" worth over 1 trillion won will be established. This year, 600 billion won will be raised, including 200 billion won for the mother fund and 400 billion won in private capital, with plans to raise a fund worth over 1 trillion won over the next five years.

Abolition of Paid Broadcasting Re-licensing

The committee plans to reorganize into a "minimum regulation system" to create an industrial ecosystem that meets global standards.

First, the paid broadcasting re-licensing system will be abolished. Until now, cable broadcasting, satellite broadcasting, and IPTV had to obtain re-licensing from the Korea Communications Commission every seven years. An industry official said, "All employees had to spend more than three months preparing for re-licensing, which was a hardship."

Accordingly, the government plans to prepare post-management measures for paid broadcasting but will abolish the re-licensing system and ease it to a registration and notification system by submitting relevant legislation.

For terrestrial broadcasting, general programming channels, and news channels, the maximum validity period after licensing or approval will be extended from the current five years to seven years.

The restriction that prevented large corporations, daily newspapers, and foreigners from becoming major shareholders of broadcasting media will also be abolished. The Ministry of Science and ICT plans to submit related legislation by next year.

The regulation limiting the market share of cable broadcasting and IPTV to one-third of the total subscribers will be removed. This was judged to preemptively restrict the emergence of large-scale media operators and hinder free market competition.

Paid broadcasting had an obligation to operate more than 70 channels, but this obligation will be abolished to enhance autonomy.

Some regulations on the broadcast time of imported overseas programs and the rule that entertainment programs must be scheduled for less than 60% of total broadcast time per half-year will also be eliminated.

Relaxation of TV Advertising Regulations to Revitalize the Market

TV advertising regulations will be relaxed to invigorate the market. Seven types of advertisements, including mid-roll ads, short ads, and subtitle ads, will be simplified into three categories (in-program, out-of-program, and other ads). This will pave the way for new types of advertisements.

The restriction limiting advertising time to less than 20% of program scheduling time will also be partially eased.

High-calorie, low-nutrition foods such as Coca-Cola and McDonald's were prohibited from advertising between 5 p.m. and 7 p.m. to protect children's health, but these time restrictions will be relaxed. Additionally, regulations that are ineffective or outdated, such as bans on advertising infant formula and processed milk, will be gradually improved in consultation with the relevant ministries.

The Ministry of Culture, Sports and Tourism plans to enhance the global competitiveness of domestic OTT platforms linked to K-content and focus on nurturing the technology and workforce to support this.

AI technology integration will be strengthened at all stages from planning to production and distribution, and advanced production infrastructure such as virtual studios will be expanded. Over the next three years, 10,000 talents, including creative convergence professionals who will lead innovation, will be nurtured.

Lee Jung-won, Deputy Prime Minister for Policy Coordination, stated, "We will ensure that the media and content industry can grow into a national strategic industry like semiconductors and secondary batteries."

He added, "We believe the key to overcoming the crisis and advancing the media and content industry lies in global market expansion, and we will provide full support for global expansion and new market preemption."

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