'The real crisis begins next year': Korean cinemas are slowly running out of movies

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'The real crisis begins next year': Korean cinemas are slowly running out of movies

Published: 21 Apr. 2025, 16:08 Updated: 22 Apr. 2025, 20:26

Audio report: written by reporters, read by AI

Moviegoers buy tickets at a CGV theater in Yongsan District, central Seoul, on Feb. 19. [YONHAP]

Korea’s film industry is running out of inventory as the so-called storage films — movies whose releases were delayed due to the Covid-19 pandemic — that have supported the market for the past two to three years are now drying up. Meanwhile, new productions are not picking up at a sufficient pace to replace them.

“Storage films kept us afloat, but now, even those are running out,” said an executive at a major film investor-distributor. “The real crisis begins next year.”

A total of 45 Korean commercial films with production costs more than 3 billion won ($2.12 million) were released in 2019, before the pandemic, according to the Korean Film Council (Kofic). That number dropped to 17 in 2021 but rose to more than 35 in 2022 as storage films flooded the market.

This year, however, the number of commercial film releases is expected to drop again. The five major investor-distributors — CJ ENM, Lotte Entertainment, Showbox, NEW, and Plus M Entertainment — used to supply more than 40 films annually before the pandemic. This year, they are expected to release only around 20 combined.

CJ ENM, for instance, is releasing just two films this year — “No Other Choice,” directed by Park Chan-wook, and “Pretty Crazy,” directed by Lee Sang-geun. For a company that has long dominated the market, this is a glaring sign of industry distress.

To fill theater screens, cinemas are increasingly resorting to rereleases. Last year, a record 228 films were rereleased — 80 more than the previous year and the highest since data collection began in 2013.

Moviegoers buy tickets at a theater in Seoul on March 2. [NEWS1]

Film industry drought to begin next year

But industry insiders say the real trouble starts next year. Given that film production typically takes two to three years, the investment freeze during the pandemic is expected to have a full impact starting in 2026, ushering in a drought in Korean film content.

Only when box office hits are consistently released can the profit be reinvested and new releases be continuously produced. But many films are not even reaching their breakeven point, let alone becoming box office hits.

Of the 37 commercial films released last year, only 10 recouped their production costs, according to Kofic. Theater attendance last year totaled 123.13 million — barely half the 226.68 million admissions recorded in 2019, before the pandemic.

“While megahits like ‘Exhuma’ (2024) and ‘The Roundup’ (2022) do emerge, the vast majority of films don’t even reach the mid-tier success benchmark of 3 million viewers, leading to worsening profitability and reduced reinvestment,” said film critic Kim Hyung-seok. “That’s affecting future film lineups.”

A moviegoer buys tickets at a theater in Seoul on March 2. [NEWS1]

“Hardly any films are getting greenlit for production,” said Lee Kyung-jae, head of content business at Lotte Cultureworks. “All investor-distributors are struggling. We may barely manage to release around 20 films next year, but the year after that looks much worse.”

“Because of worsening profitability, investor-distributors are far more cautious,” said a venture capital insider who invests in films. “The number of films receiving investment is now about half of pre-Covid levels. The film investment market is frozen.”

The most worrisome scenario is a downward spiral — fewer releases lead to poorer profitability, which leads to less investment and lower production budgets — ultimately degrading content quality. The fact that no Korean live-action films were invited to this year’s Cannes Film Festival is seen as a symptom of this ongoing decline.

“The post-pandemic drought in the film industry may last two to three years,” said Park Hye-eun, a film journalist. “More small production companies are going under. While box office hits are important, what’s truly urgent is government-led investment support.”

Screening schedules for films are pictured at a theater in Seoul on March 2. [NEWS1]

Government boost necessary

To revive the ailing film market, industry experts unanimously agree that investment must be revived. With private investment alone insufficient, the government must act as a catalyst.

“Investor-distributors can’t even afford to pay planning and development fees to production companies right now,” said an executive at a film investment company on the condition of anonymity. “The government needs to step in — whether by extending or permanently implementing the tax credit on production costs — to help save the film industry.”

“The biggest problem is that fewer films are being made,” said Yoon Ha, head of policy development at Kofic. “The government must support investor-distributors and production companies starting from the planning and development stages.”

Critics also say that government budget support is severely lacking compared to rising production costs.

Posters for director Bong Joon-ho's film ″Mickey 17″ are pictured at a theater in Seoul on March 4. [YONHAP]

“The Ministry of Culture, Sports and Tourism has allocated 10 billion won to support midbudget films this year, but with distribution and marketing costs alone reaching one to 1.5 billion won per film, it’s unclear how many films will actually benefit,” said critic Kim. “We need more funding.”

Lee of Lotte Cultureworks called for easing mutual investment restrictions on the Culture Industry Promotion Fund, the government-led ‘mother ship fund’. Currently, the fund is barred from investing in films produced by major conglomerates like CJ ENM, Lotte, or Plus M Entertainment.

“Now is not the time to worry about whether a company is part of a conglomerate,” Lee said. “To save Korea’s crumbling film market, those restrictions should be temporarily lifted.”

Moviegoers buy tickets at a theater in Seoul on March 30. [YONHAP]

Since theaters account for 70 percent of the film industry’s revenue — and are still reeling from the Covid-19 pandemic’s impact — many also call for direct support for cinemas.

“We need funding to upgrade aging facilities and expand premium formats to attract audiences, but after years of accumulated deficits, it’s hard to secure new loans,” said Hwang Jae-hyun, head of strategic support at CJ CGV. “The government should step in with low-interest loans or other financial aid.”

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.

BY JUNG HYUN-MOK [[email protected]]