The Yeouido Observer #009: And Justice for All

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George Bernard Shaw once said that hell is paved with good intentions, not bad ones.

I tend to agree.

I’ll certainly be preaching to the choir when I say this, but in most places politics is more about perception than actual reality.

If you leave out a marginal percentile made of bleeding-heart ideologues on both sides of the pond who still believe in abstract utopian constructs like communism and capitalism, people tend to have a pragmatic relationship with politics, for the most part voting with their wallets. What motivates that decision is not so much the rhetoric they’re bombarded with on a daily basis, but the perception of what lies behind that self-serving oratory masturbation – even though it might partially contradict what’s being said. It’s all the more relevant in a country that’s as disenfranchised with politics as Korea. Sure, some of the elder citizens that presidential or congressional candidates meet and shake hands with might be delusional and impressionable enough to let that “moment of grace” impact their choice. But don’t believe for a moment that such a complacent farce will amount to anything more than pandering in the eyes of anyone with a modicum of discernment.

And surely perception reaches its apotheosis when the proverbial shit hits the fan. Give the idea that you’re on top of things and ride the wave of popular sentiment the right way, and you’ll be seen as a much more efficient public servant than you actually are – or at least that’s what politicians seem to still believe, delusion which in itself might be responsible for Korean voters being so apathetic towards any side of the political conundrum. Still, the practice still goes on, seemingly untouched by all this.

Just look at the way the tragic suicide of Choi Jin-Shil quickly led to regulation allegedly making sure that kids wouldn’t be left in the hands of painfully inadequate parents upon facing the death of either mother or father, and you’ll get your answer. Look at the way the new Park Geun-Hye junta is using its new child protection laws (a disgrace that nickle-and-dimes and shames innocuous onanism while putting a convenient blanket on real, tangible crimes against children) to project the image of a pro-active government. Or picture the way the Ministry of Culture, Sports and Tourism approached the sad and shocking death of a once great producer, Kim Jong-Hak, by rushing to complete an agreement that had been wallowing in clouds of discord and inconclusiveness for the better part of the last three years – lest the public could forget about what might actually be responsible for his ultimate decision, the very same working environment that made him a star.

The short version of the story is that the MCST recently announced the promulgation of a 표준계약서, a sort of collective bargaining agreement which will supposedly regulate the often troubled relationship between broadcasters and the production companies they outsource their dramas to (the indies, so to speak). Surely any honest (Yeouido) observer will point out that this, at least on paper, is nothing more than the culmination of a project which started on April 2010, part of a larger discourse which for all intents and purposes began in 1990. It’s just the timing that smells of four day old fish with sweaty dog on the side.

But before we go through a complete translation of the new measures and an analysis of their impact on the industry, let’s go back and quickly revisit what led to today’s situation.

GENESIS

  • 1990, April – Ahead of the launch of private network Seoul Broadcasting System, a government-mandated report on possible amendments to the country’s broadcasting policies mentions the possibility of outsourcing production to independent companies
  • 1990, July – Said policy becomes integral part of the amended media law
  • 1991, January – In accordance with the new media law, network broadcasters are forced to devote at least 3% of their programs to outsourced production companies. This figure approximately increases 3% every year from there on in
  • 1991, December 9 – SBS launches broadcasts (mostly in the Seoul metropolitan area), bringing back a three-tiered competitive landscape on Korean TV for the first time since the days of TBC, KBS and MBC in the early 1980s. Days later, a little show called 여명의 눈동자 (Eyes of Dawn) would shock the nation, and begin the third, and arguably most important, Golden Age of K-drama.
  • 1994, January – On top of the expanding “indies quota” which by this point was near the 15%, the government refines the process of scrutiny even more – eliminating any outsourced production that originated from subsidiaries of network broadcasters (like MBC Production, for instance) from the equation. Now only 100% outsourced programs would be eligible for the quota
  • 1998 – The IMF Crisis deals a deadly blow to the advertising sector, altering the direction of all big 3 in a way that would shape them for years to come – one that is decidedly more business-conscious than the mentality dominating the industry up to that point. For all intents and purposes, the Golden Age of quantity and quality jumpstarted by Eyes of Dawn in late 1991 slowly becomes a thing of the past
  • 2000 – Scrutiny of the outsourced production quota is further refined, now forcing broadcasters to air productions from independent companies on prime time at least 10% of the time every month

TRANSITION

  • 2002, March – With the indies quota now just under 35% (a 1000%-plus increase since its inception), the Ministry of Culture proposes a new collective bargaining agreement between indies and big 3s, taking inspiration from western models. Under this new law, the broadcaster would only buy the finished product from the outsourced company and have the right to broadcast it three times within the following three years. Copyright would be entirely in the hands of the outsourced company (the broadcasters would only keep ad revenue). The proposed guideline goes down the drain when the big 3 protest that you can’t apply western models to Korea because these outsourced companies don’t produce those dramas independently (in terms of funding and/or personnel), but work together with the broadcasters (who provide most of the crew sans the writer) or on a by-commission level. And they’re right, really. Half-baked outsource regulation is kind of useless when most of the money and personnel actually comes from the broadcaster.
  • 2003, April – Not a particularly remarkable success at home (a 23% average in 2002 was a dime-a-dozen), Yoon Seok-Ho’s sappy potboiler 겨울연가 (Winter Sonata) begins airing on Japan’s satellite channel NHK-BS, recording rather promising ratings. The show is then moved by NHK to its network counterpart and scores a shocking 20%, for oozing a certain aura that reminded its target demographics of the glory days of the Showa dynasty – these were ratings that at the time even major mainstream Japanese dramas had a hard time reaching. The show’s success launches an amazing cultural frenzy in the country complete with franchising opportunities and the monetizing of all sorts of ancillary items that eventually generates over 9 billion yen in revenue, just that year. What had been up to then a tepid cultural trend born in the late 1990s in China now becomes a bonafide continental phenomenon. The real, commercially tangible 한류 (Hallyu, Korean Wave) is born.
  • 2004, January – The incredible success of Winter Sonata (produced by Pan Entertainment for KBS) alters the perception of market profitability of the indies and inevitably the broadcasters’ own reaction to their increased solvency, something which had always been a controversial matter from 1990 onwards. With a viable distribution model established in Japan (and to a less profitable extent in the Chinese speaking market and the rest of Southeast Asia), the increasing expenses by the big 3 due to digitalization – HD broadcasts began finding their footing around the time 다모 (Damo) aired – and skyrocketing personnel costs (for which star cachets are mostly to blame), not to mention the decline of the advertising market due to the rise of the Internet and the launch of premium cable (watering down ratings and thus the advertising appeal of the shows), the big 3 begin cutting their drama budgets significantly – including the allotted fee given to the indies. A market that had been sustained for a good 95% by advertising alone now becomes a much more complex mix of factors and possible income venues (amplified by the potential of VOD, 2nd run broadcasting on premium cable, and of course overseas distribution deals). If up to 2003 the big 3’s allotted fee to the indies had to inevitably be very high (because they didn’t have much in the way of potential revenue), now they could easily cover costs via sponsorships, PPL (which at this time is heavily regulated) and the expanding Hallyu market. With the fee that once covered 80 to 90% of the budget now barely covering half the cost, the lion’s share of the risk passes from the broadcasters to the indies themselves – who now can’t help but depend on Japan to break even. This explains the alarming increase in shows targeting foreign audiences more than the domestic one.
  • 2004, December – The broadcasting commission enacts a new outsourced production guideline on a “subject of recommendation” basis – meaning that it’s nothing more than a “best practices” advice thrown at the broadcasters, and nothing mandatory. The most important aspect of this new guideline is that any show entirely produced before broadcast would now assume the form of an independent production (namely what the broadcasters protested against in the previous CBA proposal), and thus all copyright would go to the “indie” (that’s where the moniker comes from) that produced it.
  • 2010 – The big deregulation. PPL is almost literally given carte blanche by the Lee Myung-Bak government. What up to that point had been subjected to strict limitations is now nothing more than an incentive to litter the shows with product placement that isn’t all that “indirect” (간접광고, as it’s called in Korea). Amendments to the media law also allow broadcasters and independent producers to form glorified paper companies (the SPCs, special purpose company) that only exist for a limited time and then fold – a tricky expedient to bypass credit appraisal and essentially limit the broadcasters’ risks. With the sharp decline experienced by the Hallyu in Japan (the only country where this “wave” showed tangible profitability), PPL becomes the pillar sustaining the indies’ perennially shaky funding structure. Writers are forced to concoct ad-hoc scenes and inserts just to allow the publicity of certain items, and cafes become the de facto headquarter for any discussion between characters. It’s the world they live in. The one we live in…

PRESENT DAY

Reality says that all that this system of deregulation that moved the impact of financial risk from the broadcaster to the producer fostered is the creation of a bubble economy – a system whereby market prices are defined by implausible, unrealistic future expectations, and not their actual, tangible value. Keep inflating budgets and star cachets exponentially without a funding structure that guarantees a stable return on investment, and your only future prospect will be disaster. Now left to their own devices and with the Hallyu bubble heading for a slow and inexorable extinction, these outsourced production companies find themselves literally forced to prostitute themselves at the altar of PPL (their best and last cash cow), with all the increasingly exacting demands that such a pact with the Devil entails. And after the scare of the late 1990s IMF Crisis and the impact it had on advertising, the big 3 no longer care about content the way they did in the early-to-mid 1990s: at this point everything is fair game as long as ad revenue remains stable. It’s all they’re concerned with.

And that’s no matter what happens to the quality of what they broadcast and who ultimately produced it; no matter if elder citizens are forced to shoot 18-20 hours a day under the sun for little pay they eventually might not even get; no matter if sleep deprivation leads to accidents on the set or – even worse – on the street; no matter if a selected few end up controlling 70% of the budget without actually justifying their cachet with a tangible return – because unless your eyes are covered by fanatical infatuation, no, Lee Min-Ho is not even worth a third of his current cachet when it comes to actual return on investment, nor are the Han Ye-Seuls and Yoon Eun-Hyes of the world. These are not empirical claims but actual market statistics, aside from the fact that it’s kind of asinine to claim that any single star could have enough drawing power to justify inflated cachets in this environment, considering that the country’s predominant target demographic proves on a daily basis that they would rather watch a daily morning drama filled with newcomers and veterans than trendy dramas supposedly filled with stars. Look at the numbers and they’ll give you all the answers you need.

What makes the new policies I’m about to list a bit suspect is the fact that the deregulation that made this bubble possible (from the “indies quota” of the 1990s all the way to the laissez faire approach to PPL) can only be blamed on the government and not the industry itself, as they never really let the market decide the best course of action on their own. Free market economics would have immediately phased bad investment and faulty business practices out of the system like an organism eliminating toxic waste from its body, but this is not free market economics. It’s crony capitalism of the worst kind, something which in the long run only benefits a selected few and eventually kills the market that generated this selective opulence in the first place — when what this industry really needs is a lightweight regulatory apparatus that makes sure the playing field is level, that everyone is fairly retributed and that the industry’s survival as a whole is everyone’s foremost priority.

But still, let’s take a look.

Standard Contract Agreement for Broadcast Programs – Outline

* KEY POLICIES

  • Concerned Parties: Broadcaster, Production Company, Contracted Artists (Singer, Actor), Management Agencies
  1. Contracted fees are to be paid in full by the 15th of the following month (In case of unpaid fees, the Broadcaster endeavors to pay the Contracted Artists in the Production Company’s stead)
  2. A Salary Surety Insurance fund is arranged to avoid any case of unpaid fees
  3. To improve upon the 쪽대본 (the so-called “post-it scripts,” pages of the script written on the fly and e-mailed to the set literally scene by scene, often just a couple of hours before said scene has to be shot) situation, scripts shall be delivered no later than two days before the shoot, and shoots cannot last longer than 18 hours a day and for no more than 3 consecutive days (but the 2-day script delivery rule will not go into effect until a collective bargaining agreement with the writer’s association is reached)
  4. Should Broadcaster or Production Company cancel production of a program, at least 10% of the stipulated fee will be paid to Contracted Artists
  5. After a program’s shoot is halted, re-shoots cannot last longer than seven consecutive days. The Broadcaster (or Production Company, in the case of a program entirely shot before broadcast) pays for the re-shoot in toto
  6. In the case of a prolonged shoot, relaxation facilities are to be provided directly on the location of the shoot.
  7. In the case of an accident on set, prompt assistance shall be provided, along with compensation insurance
  8. In the case of Contracted Artists being minors, special attention must be paid on protecting their physical and mental health, on allowing them the necessary time to study and sleep, and on not exposing them to unnecessarily violent or sexual scenes
  9. In the case of an overseas shoot, all logistical matters (content of the scenes, length of the stay, assorted costs, needed personnel and insurance, etc.) shall be first agreed upon by the parties involved (Broadcaster and Production Company)
  10. In the case of a planned extension of a program, agreements with the concerned parties shall first be reached, and contracted fees shall be stipulated anew – with a limit of 150% of the original sum
  11. A special arrangement with copyright collecting agencies is to be made regarding the fees for neighboring rights in accordance with the copyright law

Bit of a mouthful, right?

Now that’s all fine and dandy on paper. The best of intentions. But let’s see just how realistic some of these measures actually are.

1) SHOW ME THE MONEY. Good, great. This is more or less one of the policies I suggested back in the day. Actually it’s even better than what I suggested, because while this doesn’t directly change anything, it both indirectly forces the broadcasters to take a closer look at the companies they outsource their shows to (otherwise they’ll find themselves footing the bill more than once, which wouldn’t be much of a face-saving endeavor and would also endanger their precious bottom line) and also ensure that the cast will be paid one way or another.

FEASIBILITY: 8, FUNCTIONALITY: 8

2) SURETY INSURANCE FUND. Again, good. But with what money, and coming from whom? How about the government fund and/or profit tax I mentioned?

FEASIBILITY: 7, FUNCTIONALITY: 8

3) NO MORE POST-ITS. Great on paper, but pretty much a pipe dream and almost completely useless. Nothing here addresses the causes that lead to those “post-it scripts” in the first place (which include the oh-so-fucking-precious PPL whose deregulation the government was the first to promote, placement which often is contracted at the last moment and forces the writer to make adjustments on the fly). This is a chicken and egg matter, really, and it all goes back to a miserably dysfunctional funding structure: the live shoot is a given because the funding structure doesn’t allow you to shoot on a loss, before the show begins airing; you can’t write a script in its entirety, although you can certainly try, because the live-shoot will force last minute changes on your work (be it because of logistics, PPL, audience feedback, extensions, curtailments, accidents or anything else that can affect the story); you can surely try to deliver the script two days before the shoot, but that will guarantee two important things going by the name of Jack and Shit. Why? Because the shoot is most likely two to three days before broadcast. The crew has no time to waste, they’ve got to shoot 130 minutes of footage in five, sometimes even three days. You think they’re going to abide by regulation that limits them to 18 hours only for 3 consecutive days? Go tell that to your average sageuk production with three production teams shooting at the same time and the cast moving around like a starlet straight out of Chungmuro’s 1960s Golden Age. Puh-lease.

FEASIBILITY: 1, FUNCTIONALITY: 8

4. PICK YOUR BATTLES. Again, it has more indirect than direct impact, as it will encourage broadcasters to choose their material with a little more discernment. Won’t necessarily mean that the next 예쁜남자 (Pretty Boy) will not end up being discussed in a timeslot meeting, but it certainly doesn’t hurt.

FEASIBILITY: 7, FUNCTIONALITY: 7

5. THE POSTMAN ALWAYS RINGS TWICE, BUT KEEP IT SHORT, BUBBA. Niiiiiiice. And useless. Re-shoots? Quoi? We’re talking about the same industry where Episode 19 airing on Thursday night at 10 pm is being shot until Thursday night at 9:35 PM, and the last 10 minute tape barely reaches the editing room in time to be edited with the rest of the show? It’s like talking about potato cultivation on top of the Everest.

FEASIBILITY: 8, FUNCTIONALITY: 2

6. WE ONLY DO MASSAGE HERE. This is actually a decent idea. Too many times you see shoots where stars will spend most of their day waiting inside ad-hoc trailers (their roadie’s SUV, really) and everyone else melting outside in the scorching heat. Even out of courtesy it’s a nice thought, but good luck implementing that on every shoot, particularly considering the fact that they often travel all over the country to shoot certain dramas – although truth to be told, most sageuk that shoot at those gigantic open sets won’t have any problem supplying such facilities, since they’re glorified tourist attractions to begin with.

FEASIBILITY: 9, FUNCTIONALITY: 7

7. MAKING THE OBVIOUS SEEM EXTRAORDINARY. No shit. Next thing you know, you’ll promote the use of toilet paper as well.

FEASIBILITY: 7, FUNCTIONALITY: 10

8. IT’S FOR THE CHILDRAAAAAN. Great… but let’s not kid ourselves. This is not HBO. Objectionable content is as scarce as daily dramas without killer Hyundai trucks. Maybe not allowing writers to subject us to makjang would solve the problem much more quickly?

FEASIBILITY: 9, FUNCTIONALITY: 8

9. FLY ME TO THE MOON. Seems like something obvious, but you’d be surprised at how disorganized those little production shingles can be. Still, this would be a lot more topical in, say, 2004. Now if you go overseas it’s because investment is tied to your presence there, so most of the time your overseas shoot is a sort of PPL where you publicize a location instead of a brand.

FEASIBILITY: 9, FUNCTIONALITY: 6

10. MO’ MONEY MO’ PROBLEMS. Greeeeeat. Now how about that salary cap thingy? If 10 million are too much I’d settle for 15, like the one the big 3s made up out of thin air a few years ago, and then blissfully ignored.

FEASIBILITY: 9, FUNCTIONALITY 7

11. COPYRIGHT SCHMOPYRIGHT. Copyright is dead. Next.

FEASIBILITY: 10, FUNCTIONALITY: ?

What we get here, then, is a lot of smoke and mirrors. You throw the bone of contention (unpaid fees) right on top to animate public sentiment, and cite the most chronic plague affecting the industry (post-it scripts, insane working conditions), but don’t actually offer any solution to the problem, filling the rest of your proposals with strategies from the book of Captain Obvious. It’s easy to say “pay on time” without trying to foster that behavior by restructuring the industry’s funding paradigm from the core. It’s easy to say “choose better partners for your show” when there is no oversight in allowing those companies entrance to the market.

It’s great to have such good intentions, without even pretending to help those affected by your policies. It’s like going out there wearing a shiny ribbon and shaking hands with the ajumma selling fish at the market. You know what that paves the way for.

Hell.

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