Policy Proposals for Normalizing PPs (Program Providers) in Korean Pay-TV Market

The purpose of this study is to investigate the factors that hinder the development of PPs (Program Providers) in Korean Pay-TV market and to elaborate the solutions for them. Especially, this study sees that the irrational Pay-TV regulatory policies are the main causes of distorted PP market structure and behavior. In this vein, this study reviewed the details of the structural and behavioral regulatory policies of Pay-TV. Based on the review, this study suggests the following policy measures. First, the current PP-registration requirements, initial capital of 500 milion won, need to be strengthened. It fails to reflect the actual conditions of program production. Second, the restrictions of channel ownership and channel management which seal off the emersion of large-scale MPPs (multiple program providers) should lessened. Third, the distribution of subscription fee to PP requires be rationalized. To achieve this, strict accounting separation and prohibited acts regulation are required. Fourth, the self-producing program quota and the first-run program quota of PP programming needs to be set up. Lastly, the broadcast evaluation system that covers network TV, satellite TV, SOs(system operators) and news PPs as of now, needs to be expanded to general PPs. These policy measures are necessary to push forward as concurrently as possible in order to maximize the effect. The ultimate purpose of them should focus on pay-TV market normalization through promoting competitive PPs