July 21, 2023 at 4:03 a.m. EDT
Now, with Netflix as the dominant platform in South Korea, local screenwriters, directors and actors are expressing concerns about the company’s labor practices in their country. They are watching Hollywood’s biggest strike in six decades with hope that it will give them more bargaining power and a precedent to follow.
“We have a love-hate relationship with Netflix,” Justin Byung-in Kim, the head of the Screenwriters Guild of Korea, said in a recent interview at the offices of the Directors Guild of Korea. On the one hand, Netflix has given South Korea’s film workers better opportunities, he said. On the other hand, he said that Netflix has been paying South Korean workers too little in residuals, which are royalties that directors, writers or actors receive if their work is rebroadcast. (Netflix disputes this.)
Korean content is a big moneymaker for U.S. streaming giants: “Squid Game” alone contributed an estimated $900 million to Netflix’s value, and shooting is underway for a sequel of the Emmy-winning ultraviolent series. Netflix is planning to invest more than $2.5 billion in South Korea.
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India is also among the fastest-growing markets for streamed content. Netflix executives said that Indian movies such as “RRR,” with its hit song “Naatu Naatu,” were becoming “breakout successes in the West.” Meanwhile, Amazon’s Prime Video’s India director, Sushant Sreeram, said the company would double investments in India over the next five years, according to a local report. (Amazon founder and former CEO Jeff Bezos owns The Washington Post.)
But while U.S. streaming giants have benefited from the popularity of Indian and “hallyu” (meaning “Korean wave”) productions, any concessions earned by striking workers in the United States would not be shared by overseas creators.
For years, South Korean TV stations hired studios to produce dramas on the cheap. This meant studios overworked temporary staff and paid little, or sometimes nothing, to workers, Kim said.
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Then came Netflix. The American company offered contracts to South Korean production companies that involved lump-sum payments worth more than the cost of production, meaning Netflix assumed all financial risks, and that there would be a guaranteed profit — something that had been previously rare for dramas in Korea, Kim said.
The catch was that Netflix would own all copyrights of that show. This meant that Netflix didn’t have to pay residuals, even if the series became a hit.
Netflix said in a statement to The Washington Post that its payments to local studios are “top-of-market” rates that surpass “what they would typically receive from other” competitors, even when including residual fees. “No other streaming services operating in Korea are paying residuals,” it added.
In 2021, Korean producer Hwang Dong-hyuk told The Guardian that Netflix paid him only for the original contract for “Squid Game” when it was an independent project, before anyone could have predicted its global success. He added that shooting was “physically, mentally and emotionally draining.”
Netflix said it rewarded Hwang with an extra payment in the contract for Season 2 of “Squid Game” that is meant to reflect the success of Season 1.
“This is where it gets complicated,” said Kim.
Netflix usually outsources Korean production to local studios, unlike in the United States. This means that most South Korean writers, actors, directors and set staff — who, on paper, work for the studios and not Netflix — normally don’t get paid directly by Netflix. The streaming company has no legal obligation to sit down at the negotiating table to discuss wages or residual payments.
In a statement, Netflix said that it educates these production companies “with best practice in everything from contracts to production environments.” But “discussions about labor laws and industry guidelines are a matter for negotiation” between them and the people they hire, it added.
In a visit to Korea last month, Netflix co-CEO Ted Sarandos said Netflix would not mistreat local talent.
The Korean Broadcasting Performers’ Rights Association says Netflix has ignored an email request to negotiate residual payments sent this March. “We received a reply saying a relevant Netflix department would look into the matter,” Cho Byeong-han, an official at the association, said by telephone. “But we haven’t heard back since.”
Other industry groups like the Screenwriters’ Guild aren’t formal unions, because their members are legally seen as freelancers or individual gig workers. “According to current laws, we’d be accused of price-fixing if we attempted to bargain wages collectively,” Kim said.
That South Korea’s film workers are scattered among dozens of unofficial unions or groups worsens the situation. Even if Netflix, or any other major streaming service, decided to initiate pay negotiations in collective bargaining settings, it has no representative body to talk to, as is the case in the United States. There’s also no representative body for streamers or major studios like the Alliance of Motion Picture and Television Producers in the United States.
Set staff — the camera operators, set designers, costume designers and makeup artists who do the much of the physically fatiguing but thankless tasks during shoots — say the poor labor practices rampant in South Korea’s film industry have changed little. The country already has a long 52-hour workweek.
Streaming companies have been accused of sidestepping collective bargaining in other jurisdictions outside the United States.
Anjum Rajabali, a prominent screenwriter and a member of India’s Screenwriters Association, has been leading attempts at collective bargaining since last year, including workshops educating writers about legal and contractual procedures, and a fight for a basic minimum fee.
Rajabali said by telephone that U.S. streaming companies were willing to accept collective bargaining in the United States, but not in India.
“There is still a feudal shadow that falls here,” he said. “We are going to fight those double standards.”
Rajabali said contracts by U.S. streaming companies operating in India mostly give the producer the authority to determine writers’ credits — whereas in the United States credit issues are arbitrated by the Writers Guild of America, whose 11,000 members are on strike.
“If the strike succeeds there — and we believe it will because they are absolutely determined — it establishes a precedent that writers are unwilling to back down from what they reasonably and justifiably need in terms of protect of rights,” Rajabali said. “It will definitely have a ripple effect.”
Shubhra Gupta, one of India’s most prominent film critics, said the U.S. strike might not have a direct effect on India yet. “But the Indian industry is watching. And people are talking,” she said. “Because writers everywhere suffer from the same issues: overworked, underpaid, and given little or no credit.”
Kim, the head of Korea’s Screenwriters Guild, said he appreciates Netflix’s willingness to take risks on local talent. But the frustrations touch on Netflix’s willingness to pay what writers, actors and directors view as their fair share — especially residuals — which Netflix has been avoiding, Kim said.
“I hope Netflix doesn’t view this as a zero-sum game,” he said. “Netflix should consider [residuals] as part of its R&D budget,” he added.
“It’s a win for Netflix, too, if we get our fair share.”
Mehrotra reported from Delhi.
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