In South Korean Anti-Trust Complaint Over ‘Frozen 2,’ Disney Faces More Allegations of Monopolistic Behavior

December 2, 2019, 10:38 PM UTC

Is the South Korean release of Disney’s Frozen 2 chilling the health of that country’s film market?

A Seoul-based civic group has filed a complaint with local prosecutors alleging that Disney’s animated sequel occupied 88% of theater screens on its opening day, far in excess of what’s legally permitted by South Korean anti-monopoly laws.

On Sunday, the Public Welfare Committee, a Seoul-based NGO, filed a complaint against Walt Disney Korea through South Korea’s Central District Prosecutors’ Office, calling for an official investigation into what they believe is a Disney monopoly of the country’s film market.

The PWC claims that Disney’s Frozen 2 release strategy falls under a clause in which any individual or company with over 50% of market share can be defined as a “market-dominant enterprise.”

Disney has “attempted to monopolize the screens and seek great profit in the short term, restricting the consumer’s right to choose,” reads PWC’s complaint, as quoted in The Hollywood Reporter.

It’s unclear whether PWC has a case on this specific front, given that Korean law does not currently place a cap on what share of screen a given film can occupy, though local politicians have cited the onslaught of Disney tentpoles as a major reason to consider instituting one.

The 88% figure PWC cites is one metric for evaluating screen share, measuring the percentage of screens that show a specific film at least once in a given day. But it’s not universally accepted. The state-run Korean Film Council (KOFIC) uses a different measurement, taking the total number of showtimes for a title and dividing it by the total number of times any film was shown that day.

While Korean multiplex owners have balked at the potential loss of revenue that implementing a screen quota system could bring about, a bill restricting the percentage of a film being shown to 50% or less during prime moviegoing hours is currently pending in the National Assembly, according to The Hollywood Reporter.

Indie filmmakers in the country, as well as many Korean professionals working in the industry, have reportedly embraced the idea of a new screen quota, citing an existential threat to the idea of a homegrown Korean film industry that is posed by imported Hollywood blockbusters, particularly ones from the industry-dominant House of Mouse.

Frozen 2 has thus far earned $61.2 million in Korea, behind just its North American haul ($287.6 million) and box office results in China ($90.5 million). That figure is made all the more impressive when one considers the relative populations of those countries; while North America and China are two of the world’s biggest film markets, South Korea is home to just 51 million people.

Frozen 2 is already on track to outgross its record-breaking predecessor, once the highest-grossing animated film of all time until it was dethroned by The Lion King remake earlier this year. (Frozen remains the highest-grossing animated title ever in South Korea, having made $76.6 million when it was released there in 2014.)

Frozen 2 cleaned up at the Thanksgiving box office in the United States, and Disney’s massive release for it (globally the most successful ever for an animated film, not adjusted for inflation) is expected to make the sequel one of the highest-grossing films of the year—perhaps trailing only Avengers: Endgame, The Lion King, and still-to-come Star Wars: The Rise of Skywalker, all also Disney titles.

Whether Korean officials move to address allegations of a Disney monopoly on its film market with a new screen quota, this is not the first time Disney has been hit with anti-trust complaints, and it most certainly won’t be the last.

Suggestions that Disney has emerged not just a pop-culture juggernaut but a monopolistic superpower in the entertainment industry became increasingly unavoidable after its merger with 20th Century Fox, a seismic maneuver inked for $71.3 billion in early 2019.

Disney has accounted for nearly one-third of the total U.S. film market this year, and when that Fox merger is taken into consideration, its total marketshare is closer to 40%. Especially with Star Wars still ahead and nearly guaranteed to break $1 billion at the global box office, the studio’s on track for a staggering $10 billion year.

Such a gargantuan haul is far from business as usual in Hollywood, and the rise of Disney—which can also claim Hulu and Disney+ as content pipelines outside of the multiplex—is one of the biggest stories in entertainment this century.

Its reliance on franchise filmmaking, most evidenced by its focus on expanding Marvel and Lucasfilm operations to pump up out more superhero and Star Wars mega-tentpoles, has also sparked fear amid many in Hollywood that its business strategy will kill the midrange studio picture and in doing so widen the gap between Hollywood and the independent film circuit.

As underlined by the Public Welfare Committee’s complaint in South Korea, many in film markets globally fear the modern Disney is operating and expanding in such an unchecked capacity that it will muscle out any competitors, even other studios with financial resources.

Matt Stoller, author of Goliath: The Hundred Year War Between Monopoly Power and Democracy, may have best articulated growing concerns around Disney’s economic growth and stranglehold on Hollywood in a lengthy post titled, “It’s Time to Break Up Disney,” in which he refers to the company’s current incarnation as “Imperial Disney.”

“The new Disney is more a private equity group than studio, collecting brands and using them to bargain aggressively with partners, suppliers and consumers,” he wrote. “Imperial Disney is the result not of animation genius but mergers and acquisitions genius. It is not a corporation that pushes the bounds of artistic and technological possibility but a corporation that pushes the bounds of legal possibility.”

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