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Seeing culture as a business

Korea’s cultural offerings have been enjoying good fortune these days, especially in the film industry. “Silmido,” which lured 10 million filmgoers in Korea, will be shown in Japan at 250 theaters next month. “Old Boy,” a revenge thriller by Park Chan-wook, won second prize at the Cannes Film Festival.
Success, however, is spread unevenly. Domestic musicals are only in their elementary stage while publishing industries are going through difficult times.
Here is a roundup of how several sectors of the cultural industry are faring in Korea.

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Local musicals fight for fans, funds

Foreign musicals are enjoying unprecedented success in Korea, and deep-pocketed investors are lining up to chip in their share.
In contrast, domestically produced musicals and plays are left out in the cold by investors. Stage actors find it difficult to make a living with the salaries they receive and often have to take a second job.
“The Phantom of the Opera,” which opened in 2001, signaled the move toward imported musicals. It drew 240,000 viewers over seven months. Later, “Cats,” “Les Miserables,” and “Mamma Mia” enjoyed similar success.
The producers of “Cats” paid 3.6 billion won in refunds when the show was canceled because of a typhoon, but they still ended up in black. The producers of “Mamma Mia” earned 3 billion won in profits after investing 10 billion in total, a 30 percent return.
The success of imported musicals led to even more foreign musicals.
Disney’s “The Beauty and the Beast” will be coming this summer. “The Producers,” which received Tony awards in 12 categories, and “The Phantom of the Opera,” which will be performed by the original cast from Broadway, are scheduled for the summer next year.
Musical production companies are bombarded with requests for investment.
“These days, production companies are turning away offers of investment,” said Jeong So-ae, a public relation official at Seensee Musical Company.
In contrast, domestic musical companies are having difficulties attracting funds.
Production company officials say there are few worthy composers or writers in Korea. Seensee even asked foreign writers and composers to produce a domestic musical.
“Under the current system, it is difficult to create a good musical,” said Park Myeong-seong, the president of Seensee.
Bada, a musical production company, has been featuring “Two Men” since April 1. The production cost was estimated at around 700 million won.
Early this year, Oh Eun-seong, the president of Bada, knocked on the doors of venture capital companies, but they all refused. They were willing to invest a few billion won in imported musicals but unwilling to invest in a few hundred million won in domestic ones. Mr. Oh had no choice but to use his own money.
When a musical ends up being a failure, its cast and staff often end up empty-handed.
“The quality of domestic musicals is a problem, but investors lack the cultural mindset as well,” said Kim Yong-hyeon, president of Seoul Musical Company, which produced “Waikiki Brothers.”
The problems in the domestic theater market trickle down to stage actors. “I get only three roles a year,” said a supporting actor with seven years of experience. “Supporting actors receive only 3 million won at a time.”
Unable to cover even basic living expenses, many actors work part-time. Some teach theater classes in schools or work as day laborers.
Despite the preference for foreign musicals, some domestic works still do well. “Last Empress,” which premiered in 1995, has been running for 10 years and lured 700,000 viewers. Last year’s run at the Seoul Arts Center and the National Theater earned 2 billion won in ticket sales. A percussion performance, “Nanta,” which was popular here, has done well in New York.

Foreign fiction topping sale charts

The Korea publishing industry looks impressive on paper. According to a survey by the Ministry of Culture and Tourism in 2002, the industry did $2.3 billion (2.7 trillion won) in business, the seventh-largest market in the world.
Industry experts contend that the actual market is much bigger, when the magazine industry and learning materials are included, which sell about 4 trillion won’s worth altogether.
However, many publishers say that the industry is on shaky ground, with the market for single volume books ― non-fiction and fiction ― making up less than 1 trillion won. The bulk of the market is made up of cartoons and children’s books.
The figures show that the local book market still has a long way to go in terms of gaining intellectual heft. But the good news is that there have been gradual changes within the past 10 years.
Sales for single-volume books have grown slightly, with a number of Korean books translated into foreign languages to target Southeast Asian readers.
“Sangdo,” by veteran writer Choi In-ho, has sold more than 2 million copies in China, securing the top spot of the bestseller’s list there.
“Winter Sonata,” a book that was made into a television hit series, was released by NHK Publication, selling almost 1 million copies. An English learning guide by a Korean author was recently translated into Japanese and has sold more than 800,000 copies so far.
Last year’s fiction book market saw foreign books fill more than half the bestseller list. The biggest reason was continued stagnation in domestic fiction. Except for the ones recommended by Neukkimpyo, a TV program, there were no Korean fiction titles in the top 20 list, according to Kyobo Bookstore.
In 1989, 1994 and 1999, 11 or 12 of the top 20 fiction bestsellers were Korean titles, but the number dropped down to seven this year.
Slow sales means less money going to writers. Though few writers and poets expect to become rich, a 47-year-old female poet who declined to be identified said she was in deep financial trouble.
The writer, who published her third collection of poems last year, said, “I don’t intend to make money from writing poems.” She said she made up to 500,000 won ($424) from writing poetry last year.
“The publisher sold the first 1,000 copies and recently printed another 500 copies, but I get no royalties,” she said. She said she spent all her proceeds to reserve 200 copies for her friends and colleagues.
She does everything she can to earn money, including editing at a magazine and writing for company newspapers and documentaries.
“These days, I am satisfied with 20,000 to 30,000 copies sold instead of 100,000 copies sold 10 years ago,” said Kang Tae-hyeong, the president of Munhakdongne, a publishing company.
“Writers need to sell 30,000 copies a year to make a living, but there are only a handful of writers who can do that,” Mr. Kang said.
Book industry experts see hope in the non-fiction markets. Publishers cite books such as “Bobos in Paradise,” by David Brooks, as a successful example in the United States.
They predict that readers will look for subjects that are more “real” and that are based on professional and analytical research.

Galleries see hope in small buyers

Earlier this month, “Boy With a Pipe (The Young Apprentice),” which Picasso painted when he was 24, was sold for $104.1 million at Sotheby’s through an anonymous bidder ― the most expensive painting ever sold at the auction.
It’s doubtful that a Korean work of art will ever get close to commanding such a price, but the market here isn’t minor either. According to the Ministry of Culture and Tourism, the local art market is worth about 350 billion won annually, including antique art, reproductions and contemporary artworks.
However, the market has places for buyers who have smaller budgets as well.
Yu Yang-ok, a Korean painter, put out a sign at a gallery entrance during his solo exhibition two years ago that said, “Anyone can come in and ask what the price of the paintings are,” aimed at gallery visitors who assume that anything sold in galleries ought to be expensive.
Most of Mr. Yu’s paintings had a price tag of about 1 million won. By the end of the exhibition, he sold 90 percent of his work.
Mr. Yu, who used to work as an art dealer, says, “There needs to be some sort of compromise among the collectors, artists and gallery dealers in order for the Korean art market to survive.”
Park Young-taek, an art critic, says the slow art market in Korea is due to two reasons: collectors who buy art as an investment and those who buy art in order to profit later, by selling them for a higher price.
He says galleries haven’t done enough to restore the trust of collectors who appreciate art and like to purchase them at a reasonable cost.
According to curators, the art market is suffering a great class gap between established artists and emerging artists, but some say the trend is slowly changing.
“A growing number of collectors have begun buying small-medium price collections by young, emerging artists that suit their tastes,” says Yun Tae-geon, a director of Kais Gallery.

Galleries see hope in small buyers

Before “Silmido” or “Taegukgi” broke box office records several months ago, most Korean blockbuster-type movies did poorly financially, and that’s not likely to change.
“It’s a bit of a stretch to say that the entire paradigm of Korean film has changed with the success of ‘Taegukgi’ and ‘Silmido,’” says Jeong Tae-seong, a staff member of Showbox, a film production company.
In 2002, when a number of Korean films that spent an average of 5 to 10 billion won each were released nationwide, the industry saw a 17 percent loss at the box office, about 5.6 million won. That figure came from a Korean Film Council annual report of 78 films released in Korea in 2002, of which 64 were considered “low-budget” films.
The previous year, in 2001, the industry had an increase of 18 percent at the box office.
“It was naive of producers to experiment with a budget of that scale,” says Kim Hae-jun, a secretary of the Korean Film Council.
The average investment by Cinema Service and Showbox, producers and investors of “Taegukgi” and “Silmido,” was about 2.5 billion won, according to a 2003 report by Im Pictures. With so much money spent, it’s tough for investors to recoup their money at the box office.
In Korea, half of a 7,000 won ticket goes straight to the theaters. An average of 7 to 10 percent in processing fees go to distributors. As a result, producers get only 2,800 won, or 40 percent, from each movie ticket sold.
Even then, producers’ profit margins are further reduced by the costs of pre- and post-production efforts and marketing campaigns. That is why Shim Jae-myung, a producer of well-regarded films such as “Joint Security Area” and “A Good Lawyer’s Wife,” says the golden age for producers has passed and most likely will never come back.
Yet people in the film industry cling to hope, now that the North American market is showing more interest in Korean films. More than 160 Korean films were distributed abroad last year, making about $30 million, about twice more than the previous year.

by Special Report Team