Seoul, South Korea – CJ ONstyle, a major South Korean home shopping network, has abruptly halted its broadcasts on several cable TV channels following a breakdown in negotiations over channel usage fees.
Effective immediately, CJ ONstyle's programming will no longer be available on D'live, Areum Broadcasting, and CCS Chungbuk Broadcasting. The decision comes after prolonged negotiations between the home shopping giant and the cable TV operators failed to reach an agreement on the fees paid to broadcast on their platforms.
This marks the first time a major home shopping company in South Korea has resorted to such a drastic measure. Previously, in 2015, Home&Shop had a similar dispute with Nam Incheon Broadcasting that resulted in a temporary broadcast halt.
CJ ONstyle has attributed the decision to a significant decline in average transaction value and subscriber numbers for the three cable operators in recent years. Despite requesting a fee adjustment that aligns with broadcasting regulations and industry guidelines, the company claims its proposal was rejected.
However, the cable TV industry has countered these claims, accusing CJ ONstyle of demanding excessive fee reductions and unilaterally halting broadcasts. The Korea Cable TV Association issued a statement condemning the move, asserting that it undermines the business operations of cable TV operators, disrupts the balance of the pay TV ecosystem, and infringes upon the basic viewing rights of consumers.
With both parties unable to reach a consensus, the dispute is expected to be referred to the Ministry of Science and ICT, which will facilitate mediation between the two sides.
Channel usage fees, often referred to as carriage fees, are payments made by home shopping networks to cable TV operators for the right to broadcast on their platforms. As viewership declines and economic conditions worsen, the home shopping industry has been facing mounting pressure, leading to intensified disputes over these fees.
Last year, the combined channel usage fees paid by the seven major home shopping companies amounted to 1.9375 trillion won, representing a substantial 71% of their total broadcasting revenue. Other major home shopping networks, including Lotte Home Shopping, Hyundai Home Shopping, and GS Shop, are also engaged in similar negotiations with cable TV operators.
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