It has been discovered that four of Korea’s major digital music distributors owe a total of over 17.4 billion won (approximately $15.4 million) in royalties to copyright holders.
Cho Seung Rae of the Education, Culture, Sports and Tourism Committee in Korea’s National Assembly recently made an announcement after examining documents from an inspection conducted by the Ministry of Culture, Sports and Tourism. He stated, “The unpaid royalties and neighboring rights royalties owed to music creators and performers by the ‘Big Four Digital Music Distributors’ amounts to 17.4 billion won during the period from 2014 to the first quarter of 2017.”
In this context, “royalties” refers to money paid to music copyright holders such as composers and lyric writers, while “neighboring rights royalties” refers to money paid to singers and musicians, etc.
The largest Korean music site Melon, run by Loen Entertainment, owes over half of this amount, with 9.7 billion won (approximately $8.6 million) overdue in royalties and neighboring rights royalties. Genie owes 3.4 billion won (approximately $3 million), Bugs owes 2.3 billion won (approximately $2 million), and Mnet owes 2.1 billion won (approximately $1.9 million). The amount owed to copyright holders has been increasing every year.
Cho Seung Rae stated that this issue of unpaid royalties has been brought up continuously in the past, but that the government hasn’t been able to prepare countermeasures and that the companies have not put effort into solving the problem.
Melon has stated in response, “Digital music service companies are working with the government and copyright holders to find a solution.”
The company added that one of the ways they have been trying to reduce the occurrence of unpaid royalties is maintaining a database of information about copyright in partnership with associations such as the Korean Society of Composers, Authors, and Publishers; the Federation of Korean Music Performers; and the Recording Industry Association of Korea. They stated that they have also been taking part in discussions with the ministry for the improvement of laws and systems for the past few years.