‘New’ 2007 whitepaper on Korean Games

The Korean Ministry of Culture and Tourism and the Korea Game Industry Agency have just released the latest whitepaper on the Korean game industry – The Rise of Korean Games 2007.

The document contains industry figures for 2006 (a shame to be just getting this now!) and outlines government policy trends and strategies for the industry. It can be downloaded from the Korean Game Industry Total Information Service System website.

An addendum, the volume does appear to be published mid-2007. It has only just been listed on the GITISS website as of 8 September 2008, so perhaps this publishing date refers to the original Korean language version?

 

Korean media ownership law changes on the horizon

Changes to media ownership laws have been proposed by the Korea Communications Commission according to a Variety article on 3 September.

Korean President Lee Myung-bak has followed this up with a statement that indicates the government’s desire to have a globally competitive media player with the scale to make an impact in international markets.

The government should create an environment to enable the advent of a world-class media firm with global competitiveness by drastically loosening the string of regulations on the broadcasting and communications sector.

From the KCC report, the government’s strategy to achieve this appears to be not through lifting foreign investment limits but by loosening cross-media ownership laws.

The stringent regulations on ownership and multiple ownership prohibit the broadcasting sector from expanding through new investments and mergers and acquisitions”

New media environments have challenged the legitimacy of incumbent cross-media ownership laws, but one does have to wonder if the way to a more globally competitive media conglomerate would not be best achieved by relaxing foreign investment restrictions, no matter how unpalatable that may be.

In other words, despite ideological resistance in Korea to opening up the media industry to foreign players, this may provide an avenue of providing greater diversity in the Korean media while not restricting plurality and freedom of speech. This is particularly the case in Korea where censorship law are stricter than in many other democracies, and a further concentration of power in the media – and big business groups in general – is precisely what successive administrations have been fighting to reform.

 

Japan-Korea to collaborate on scriptwriting in pan-Asian initiative

Japanese, Korean, and recently Chinese TV dramas have all boomed in export markets, if only for short-lived waves. But with all nations eager to increase exports of creative content, focus from within the industry has been drawn to intra-regional co-productions.

In an article in the Daily Yomiuri, Yoshikazu Suzuki outlines the prospect of a joint Japanese-South Korean TV drama production mooted at the third TV Drama Forum of East Asia held in Sasebo, Nagasaki Prefecture.

Such collaboration could see Japanese scriptwriters, for example, teaming up with Korean creative, technical, and acting talent.

The project emerged as momentum grew among the Japanese and South Korean participants toward jointly producing dramas. The project involves seven popular Japanese scriptwriters, including Yoshikazu Okada, Yumiko Inoue and Shizuka Oishi, who will write original scripts with settings in South Korea, as well as South Korean directors and actors. The project calls for each episode, which will last up to two hours, to be broadcast by TV stations in both countries after being shown in cinemas.

This would allow entry of Japanese co-produced drama onto Korean terrestrial broadcast, (the article indicates Japanese drama is still banned) and provide the Korean industry with an injection of writing talent.

It would be interesting seeing a similar use of scriptwriters filtering through to other sectors of the Korean content industry such as animation, where studios have often been met with great acclaim for their technical prowess but have fallen short of receiving similar praise for the stories that hold together original home-grown animation.

 

Status of Korean animation industry

CEO of Synergy Media Eugene Kang has issued a press release detailing some of the challenges and opportunities in the Korean animation market. (see Newswire Today)

While the Korean animation market is facing rising cost for OEM production meaning production has become cheaper in other countries, Kang believes Korea is becoming a place for producers to turn to for original content.

Another challenge Kang mentions is new distribution channels such as IPTV, which make the distribution environment ‘obscure’. This is a valid point, given that while IPTV and other internet channels are often looked to as proliferating the number of channels thereby increasing distribution options, the audiences of each of these channels is likely to be small. Therefore unless they have a well established niche viewership that is attractive to potential advertisers, these channels are likely to be filled with low-cost content that has already recouped it production costs rather than new and original content that has yet to earn revenue. Because the channels are not yet established, the operators would be unlikely to pay pre-sales for a new production unless they have very deep pockets.

Further, despite the shrinking of the domestic market, due to its talent in producing high-quality animation and supportive government programs, it is an ideal country to engage with for co-productions.

This certainly seems consistent with my impression of this industry in Korea. While there seemed to be a lack of talented scriptwriters, the sophistication of many animation studios combined with the entrepreneurship of producers suggests that a co-pro that employed foreign writing talent with Korean design and technical skills may produce properties that are successful internationally.

 

Post-wave Korean Content

Korean content producers, supported by government, are looking to extend their reach further into international markets, beyond Asia.

An article in Variety

• Korea’s content industries are likely to produce ‘more nuanced’ properties rather than relying heavily on the local star system, . Big names appear not to be getting the pre-sales that they were overseas.
• Film commissions in Seoul and Busan are becoming more aggressive at establishing Korea as a viable shooting location.
• The film industry is looking to the US and Hollywood both for distribution and co-production opportunities
• The technological savvy of local firms is helping to give Korea a leg up in certain sectors like special effects and new media.
• Korean animators, who have gained technical expertise through years of outsourced U.S. work, are becoming strong contributors. KOCCA and other government organisations provide significant funding for training in the industry.

My question though, is how developed their storytelling ability has become, and to what extent government policies are aiming to develop these non-technical creative skills.

 

Korea in the global character industry

Things are looking up for the character business in Korea, according to an article in the English Chosun.

Industry size. The sales volume of the character industry in Korea totaled W4.288 trillion in 2005, with Korean characters claiming a 41 percent share of the market, up 6 percentage points from three years before.

Trade Surplus. According to data on character-related products, the export volume of W163.6 billion surpassed the import volume of W123.4 billion in 2005. This is a turnaround from the previous year. 2004 figures suggest exports were W134.2 billion and imports W148 billion.

International collaboration.

The successful overseas debut of Pucca was the fruit of a multinational collaboration. Korea’s Vooz Character Systems developed and marketed Pucca, the U.K.’s Jetix put up the funds, Canada’s Studio B produced the animation, and an American writer took care of the story. Korea’s advanced information technology did its part in the development of the character.

 

North Korea as a major player in animation industry?

While North Korea more often makes headlines for nuclear tests and programs, economic sanctions, and human rights violations, the nation often described as reclusive and impoverished appears to have an emerging animation industry, according to an article from December 2006 on the Radio Free Asia website. The article indicates that North Korea is becoming a “significant player in the global business of animation and cinema—exporting cartoons throughout Asia, Europe, and North America.”

According to the article, the state-run SEK studio is one of the largest in the world, employing 1,600 staff who work with “state-of-the-art equipment.” The North Korean studio has worked on Pororo from South Korean, and US animated features such as The Lion King and Pocahontas, as well as the Teenage Mutant Ninja Turtles series.

The article also reports that South Korean animators have been collaborating with North Korean animators to produce some of their animated TV episodes.

The volume of these cross-border transactions (any data on exact numbers??) makes sense on a variety of fronts. From an outsourcing (both economics and supply chain manangement) perspective, North Korea uses the same language, is in close geographic proximity, has cultural similiarities at least historically. Vitally, one would expect enormous cost savings for South Korean firms to outsource animation work to the north. Politically, the South Korean Government has been eager to engage with the North so we could hypothesise at least that firms would face few political roadblocks on the Southern side. Political issues and transparency issues in the North not withstanding, the only key issues left would be quality of workmanship and the ability to communicate clearly to contractors what work is required.

On the quality front, animators featured in the article seem to think there is no problem:

Choi Jong-Il, president of Iconix Entertainment believes the technical skill of North Korean animators is well developed.

“North Korea employs animation to deliver various messages to the public, and North Korean animators have been sub-contracted by Japanese and European companies. That is why technically they are strong.”

Nelson Shin, founder and president of of Akom who has worked on animated television series including “The Simpsons,” “The Pink Panther,” “X-Men,” “Invasion America,” and “Arthur” and has directed “The Transformers”, was surprised by the quality coming out of North Korea.

“The first time I watched North Korean animation, I simply thought that if we tried our best, there might be a possibility to work together, but I had no idea North Koreans would turn out to be such outstanding animators,”

Yet Choi believes they fall down on their ability to communicate, which appears to be hampered by the lack of freedom of movement of people in and out of North Korea.

“To come up with work plans, one needs a steady flow of communication, but communication with North Korea has been very difficult,” Choi said. “Short of traveling there, the best one can do is to communicate via fax, but they’re not very enthusiastic about doing that either. This wouldn’t necessarily be a huge problem, if we could travel to North Korea freely, as we do to other countries.”

Shin however, is more positive about communications between the two nation’s animators.

“With South and North Korean animators working together, there are no misunderstandings or miscommunication. For three years, South and North Korean animators worked hard together and conversed well.

Shin has had his latest North-South co-production is 39-episode animated TV series titled “The People of Koguryo,” approved by the North Korean Ministry of Culture and the South Korean Ministry of Unification.

 

Malaysia announces establishment of animation centre

On the 9th March during a visit to Seoul, the Malaysian Deputy Prime Minister Datuk Seri Najib Tun Razak announced the establishment of an animation centre in the Malaysian Multimedia Super Corridor (MSC) town of Cyberjaya.

The press release on the MSC website indicates the Malaysian Government’s belief that the content industry can be a significant source of growth, innovation, and augment economies to produce higher value-added products and services to compete internationally.

The content industry has a huge global market and the setting up of the centre will give our people, who have a high level of creativity, numerous opportunities to venture into the existing market.

And in a move to an intellectual property-driven economy, animation appears to be the ‘industry of choice’ for various governments to make a foray into supporting content industries. The dominance of Japanese animation in world markets and the emergence of Korea as a competitive ‘animation-nation’ has undoubtedly prompted various policymakers in Asia to adopt a “me-too” (?) approach. This combined with the steady rise in international animation trade, and the ‘ease of entry’ into animation (both from technical and export market adaptability perspectives) has resulted in a number of countries looking to animation as a key to entry into international media content markets.

Another notable item in the press release was the announcement of collaborative agreements and MoUs between Malaysian and Korean animators, and the Malaysian Multimedia Development Corporation (MDeC) and the Korea Culture and Content Agency (KOCCA)
With more and more nations looking to morph their inward-looking local content industries into ‘vibrant’ ‘competitive’ industries situated in ‘global media cities’, one has to wonder about the potential for “success” in an environment where multinationals, investors, and creative talent have an ever expanding suite of options to choose from.

Is there a hint of location tournaments in the air? The issue raises a series of questions.

• What policy instruments are governments using to attract industry players?
• How much effort is being placed on the development of human capital and building of capacity locally?
• To what extent are generic policies that encourage free movement of capital, freedom of expression, education, and a high standard of living being used compared to specific industry policies that provide incentives, tax concessions, and subsidies for local firms or multinational entrants?

The answers to these questions are a start to deciphering some of the government rhetoric and determining which policy settings are suited not just for foreign investors but for the growth of domestic industries and local economic development.

 

Korean Nationalism re-loaded?

It was interesting (yet hardly surprising) to find an editorial in the English version of the Chosun Ilbo (entitled Korea Can’t Keep Siphoning Off Japanese Culture ) calling for the Korean content industry to stand on its own two feet rather than copying or importing Japanese films, books, and TV dramas.

Korea really only opened up to Japanese cultural imports for TV programming in 2003 (according to my figures at least – I am always open to new info). Koreans have effectively been starved of Japanese content due to government policy banning its importation. They could certainly be forgiven for binging on Japanese popular culture such as music, books, and television drama, if that is indeed what they are doing.

With a massive local content quota of around 80 percent for television broadcast, Korean broadcasters have faced real barriers to broadcasting foreign content (Japanese animation dubbed into Korean for example) and have needed to source local programs. It is no wonder that many of these have been ‘copied’ off Japanese formats, given the financial legal barriers (and financial incentives?) to produce local adaptations.

Proponents of nationalist and protectionist sentiment need to accept that the flows of cultural content has been far from uni-lateral. Korean content does have its own unique style , and Japan was as caught up in the Korean Wave (hallyu) as other countries in Asia. One could even say that the relaxing of restrictions on cultural imports helped to give the Korean Wave some of its momentum, particularly in Japan, as it allowed foreign content traders into Korea, and also gave the Korean industry the impetus to be export-oriented rather than rely on protection from formidable competition across the water. (again, feel free to bring me down on this one)

The editorialist does recognise the popularity of Korean content in Japan:

The reason Korean TV dramas like “Winter Sonata” and Korean movies do well in Japan is because of this market principle. And it is because of that market principle that Japanese products are popular among Koreans. There is no rule that says only our culture should be marketed overseas and not vice versa.

Yet, the writer feels there something fundamentally different about this case than simple market fundamentals, which lies in Japan’s advantage at reaching out to middleclass audiences…

The Japanese know how to embrace middlebrow readers, in between high and popular literature. That genre is nonexistent in Korea. High literature trundles down its own path, without looking back at its readers. In contrast, popular literature can’t see its readers since they are often too embarrassed to admit they are reading it. And fans of literature fall through the gap between the two genres. Readers who cannot find solace in Korean literature have fueled a Renaissance of Japanese literature in Korea.

So by the writer’s own admission, we now have a section of the Korean public that now is satisfied, having been unable to get their hands on the material they desired, and now, with the importing of Japanese content, their entertainment needs have been satisfied.

Forgive me for applauding the newfound happiness of others, but is this not a good thing? I am sure that the depicted polarisation of Korean content is somewhat of an exaggeration, but even if it is so, Japanese content has found a niche in Korea for which consumers are apparently grateful. In any case, the rights for Korean translations of Japanese works will no doubt reach a price in the future where it becomes more economical to produce local content than import it and pay exorbitant license fees. In the meantime, talent who can tap this “middlebrow” market will undoubtably develop locally and will be able to compete. When that happens though, it will be no surprise if certain camps bemoan the fact that local creative talent has taken to copying Japanese cultural imports.

There is enormous value in nurturing and promoting cultural differences. There is a danger, however, in placing nationalistic protection of local culture above the quality of life of those whom proponents purport they are professing to protect. Cultural diversity enriches lives, but there are also scores of cottage industries around the world that survive purely on rents derived from convincing governments of their cultural significance.

Given, nationalism occurs everywhere. In an inverse of the Korea/Japan cultural imperialism saga, the Australian entertainment industry was up in arms in 1998-9 when the High Court (see Project Blue Sky vs Australian Broadcasting Authority) ruled that New Zealand television programs must be considered as Australian programs for broadcasting under the free trade agreement rules (Closer Economic Relations treaty). There was talk of cheap New Zealand programs flooding the market, that NZ productions were unfairly subsidised, that children would be subjected to NZ accents while watching cartoons (cultural imperialism arguments against the US were temporarily forgotten, and the fact that NZ kids were probably sitting through a lot of Australian programming was not even considered). It caused concern that with multilateral trade negotiations, Astro Boy might even be considered Australian.

People working within a protected industry will always fear for their economic security when barriers to trade are removed. Likewise those who sense a vulnerability of their cultural heritage or way of life will tend to fight to shelter it rather than to preserve it by giving it temporal currency.

 

Korean Ministry of Culture to promote Korean Wave

The Korean Ministry of Culture and Tourism has announced that 2007 will see it placing top priority on nurturing the fast-evolving content business and redefining “hallyu,” （韓流）or the Korean Wave.

According to the Korea Herald,  the Culture Ministry and the Information Ministry have teamed up to set aside 19.2 billion won ($20.55 million) to develop “Digital Creature” technologies – referring to cultural products that are created through purely digital solutions.

The Korean Wave, which depends largely on pop culture led by trendy television dramas, movies and music, is facing growing challenges in Asia and elsewhere. Exports of Korean films are declining, and in some Asian countries, a so-called “anti-hallyu” sentiment is being detected.

Culture Minister Kim Myung-gon had this to say:

The ministry will focus on…preparing for sweeping changes that spark content- and imagination-oriented innovation, and globalizing the Korean Wave further while minimizing side effects.