Proposed "Holdback" Period for State-Funded Films on Platforms Like Netflix Divides Industry Opinions

“Concrete Utopia” on Netflix, Courtesy of Netflix

South Korea's Culture Ministry is considering a plan to impose a grace period, potentially up to six months, before films that received government funding can be released on streaming platforms, including Netflix. This move has triggered mixed reactions within the local entertainment industry, involving film distributors and streaming platform operators.

In November, the ministry introduced a temporary "holdback" period for films with a production cost exceeding 3 billion won that received state funding. This required distributors to wait four months after the theatrical release before making them available on streaming platforms. The aim was to support the struggling film industry in the wake of the pandemic. 

▲ “Concrete Utopia” on Netflix, Courtesy of NetflixAuthorities are now in discussions with industry insiders to fine-tune the details of this "holdback" system, and there are indications that the grace period might be extended to six months. While the Culture Ministry suggests that any agreement should be voluntary without binding force, opinions within the local entertainment industry are divided.

Some argue that films need a certain period in theaters to attract moviegoers, benefiting distributors, multiplex chains, and production firms. They believe a concrete, state-supervised system is necessary to boost the overall entertainment industry, as cinema remains a major source of profit.

However, concerns are raised about potential drawbacks for box office failures, which could miss the optimal time to gain attention on streaming platforms during a designated holdback period.

Streaming platform operators anticipate that any holdback system may limit subscribers' rights to choose what to watch, affecting the diverse selection available on their services. Subscribers express worries that delayed releases may diminish interest in Korean films.

Experts caution that the government should approach the matter carefully, considering the multifaceted perspectives within the industry. They stress the need to provide opportunities for mid- and small-scale films to profit on different platforms, ensuring they aren't forgotten if subjected to a holdback system. Solutions that address exceptional situations and prevent the neglect of certain films should be considered.

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