Monopolies Leave South Korean Indies Feeling Powerless: "It's Madness"

Films in the country are getting squeezed out when releases from corporate giants dominate theaters and 'Avengers: Infinity War' takes up 88 percent of the local screens.

On July 26, 2017, the South Korean film The Battleship Island recorded what was the biggest opening day in local box-office history: $5.7 million. The Ryoo Seung-wan war epic opened on 2,027 screens — about 75 percent of the estimated 2,700 in the country at the time — and accounted for 71.4 percent of the market that day.

Battleship Island was financed and distributed by CJ Entertainment, the sister company of the country’s largest exhibitor, CJ CGV. With more than 1,000 screens nationwide, CGV has dominated about 50 percent of the market share since 2013 (48.7 percent in 2017), according to the Korean Film Council, the state body for promoting local films.

The big reach has sparked debate about market power in the country. “This is beyond monopoly,” filmmaker and professor Min Byun-hun wrote in a Facebook post at the time of Battleship Island's debut. “It’s madness.”

Observers say that the negative reaction from industry folks and the public at large was heightened because less than a month earlier, CGV had been at the forefront of boycotting Bong Joon-ho’s Netflix film Okja. Along with the two other major exhibitors, Lotte Cinema and Megabox, it opposed the streaming giant’s policy of not giving films an exclusive theatrical window.

Lotte, the second largest Korean exhibitor, also drew scrutiny recently. Steel Rain, a star-studded actioner about a North Korean spy, was one of the most anticipated titles of the winter. It was handled by NEW, a top distributor but not a top exhibitor. In mid-December, the film was shown on 1,390 screens, but that plummeted to 988 after many screens were allotted to Lotte’s own VFX-heavy fantasy drama Along With the Gods on Dec. 20. Gods went on to hit nearly 2,000 screens and become one of the top-grossing Korean films ever, scooping up $108.2 million, while Steel Rain brought in a slightly disappointing $33.2 million.

“Moviegoing would become a more enriching and fun experience if audiences’ right of selection was better respected at cinemas,” Steel Rain star Jung Woo Sung told fans in December.

More recently, Avengers: Infinity War kicked things up a notch, hitting 95.1 percent of market share in setting a Korean opening-day record of $6.5 million. As of May 9, Korea topped the international market for the Marvel film with $74.6 million. The superhero blockbuster also took over the most screens in the country ever, showing across as many as 2,553 — 88 percent of the nation’s 2,887 total, according to the Korean Film Council. It played 13,183 times on one day, while local thriller True Fiction, which opened the same day, secured at most 863 screens and 434 screenings.

Marvel films have been very popular in Korea, but Infinity War’s towering numbers have reignited the monopoly debate in Korea, with many industry insiders saying measures are needed to create room for smaller films.

“The monopoly of big studio films has definitely gotten worse,” says Jason Chae, president of international sales company, distributor and producer Mirovision. “Looking at the typical screening schedule of any given multiplex cinema says it all.” He said Dangal, the Indian comedy that the company bought that is now showing in local theaters via NEW, has been allotted odd screening times like 1 and 7 a.m.

“We have been receiving complaints from moviegoers that they can’t watch it even if they want to," Chae says. "We are aware that public demand is high for movies like Avengers. We aren’t asking for much, just one primetime showing.”

Some analysts, however, argue that blockbusters do not deserve all the blame. “If a film attracts more than 1 million admissions, it means audiences have reacted positively,” said market analyst Kim Hyung-ho, adding that cinemas focus more on revenue than loyalty to films from sister companies. A recent report from the Korean Film Council says that while CJ films paced the Korean market with a 15 percent share, NEW actually dominated the domestic market at 25.2 percent.

In one example of popularity overruling other considerations, Avatar, the only imported title among Korea’s top 10 hits, went from 724 to 917 screens in 2010 as demand grew. And in 2016, CGV had to call moviegoers with advance reservations for Kung Fu Panda 3 to make more room for the popular Showbox title A Violent Prosecutor despite its exclusive relationship with DreamWorks Animation.

“CGV plans to cooperate with others in the industry by revealing research results and holding marketing conferences... so that cinemas will continue to attract moviegoers,” said Lee Seung-won, head of CGV Research Center.

Nevertheless, many in the industry have called for state measures to battle market power — so far without success. Korean Culture Minister Do Jong-hwan suggests that multiplexes designate at least one theater for art house and indie films. Another lawmaker proposes that no title should receive more than 40 percent of showings at any given cinema directly operated by conglomerates.

“Distributors and exhibitors must balance out supply and demand, but currently they are being solely swayed by demand,” says Chung Yoon-chul, the filmmaker behind Fox’s 2017 local production Warriors of the Dawn. “Things have come to a point where the government really needs to take action.”

A version of this story appears in The Hollywood Reporter's May 11 daily issue from the Cannes Film Festival.