KOBACO’s Ad Monopoly Likely to Be Lifted
By Jane Han
Staff Reporter
The nation's terrestrial broadcasters ― KBS, MBC and SBS ― are likely to be enabled to sell their own commercials starting next year once lawmakers approve the government's plan to overhaul the current system.
The Korea Broadcasting Advertising Corporation (KOBACO), a state-run media ad agency, has long secured a monopoly for terrestrial TV and radio airtime sales. But the nation's telecommunications regulator made a move Friday to snatch away KOBACO's solo run.
The Korea Communications Commission (KCC) submitted a proposal to the National Assembly, calling for lawmakers to change the current law to allow more than one private media representative to compete in the market.
A media representative is a broadcasting ad agency that serves as a broker between broadcasters and advertisers. KOBACO has monopolized the work for 147 terrestrial television and radio stations nationwide, but its exclusive status has been scrutinized as critics have argued that it distorts market principles.
The KCC said it plans to shut down KOBACO and set up a new government ad sales agency that will play a minimized role compared to the existing state enterprise. One or more private media representatives that will newly enter the market will trigger competition, government officials said.
``We don't know how many media representatives are going to be allowed, but the bottom line is that getting rid of KOBACO's monopoly will help reshape the local TV ad sales market,'' said Chung Han-keun, an official of KCC.
The National Assembly's culture, sports and tourism committee is scheduled to hold a hearing on the issue on Dec. 18 before finalizing its decision on the law revision.