Appearance Fees Swallow Dramas: Broadcasters Face Deficits, Production Companies Squeezed

Wide Perception Gap Between Broadcasters and Production Companies Over Production Budgets
Top Stars' Fees Account for 32% of Total Budget
Government-Recommended 'Standard Production Costs' Prove Useless in Practice

Drama filming site. Photo unrelated to the article content.

The surge in appearance fees fueled by global online video services (OTT) is undermining the ecosystem of the Korean broadcasting industry. Major platforms such as Netflix have driven the per-episode pay for top stars up to hundreds of millions of won, which has now become the de facto 'standard rate' in the domestic market. Traditional legacy media, including terrestrial broadcasters and general programming channels, are being pushed to the brink as they cannot afford these skyrocketing appearance fees.

The '2025 Survey on Outsourced Production Transactions for Broadcast Programs' report, published by the Korea Creative Content Agency on April 10, provides stark numerical evidence of the structural collapse of the broadcasting industry. According to the report, both terrestrial broadcasters (32.5%) and production companies (32.7%) indicated that appearance fees accounted for the largest portion of total drama production costs. The structure has become distorted, with a single lead actor’s fee consuming one-third of the entire budget.

Broadcasters unhesitatingly identified appearance fees (100%) as the most urgent area requiring price reduction, and an overwhelming 83.3% of production companies agreed with this assessment. A broadcasting company official, Mr. B, stated, "With appearance fees for most lead actors reaching 200 to 300 million won per episode, it is impossible for broadcasters to recoup their investment. The moment a mini-series is produced, it is bound to incur losses, so now the focus is solely on how much to minimize the deficit."

Unable to shoulder the soaring production costs, broadcasters ultimately squeeze outsourced production companies. An official from a production company, Mr. A, lamented, "Out of a 15 billion won production budget, the lead actor alone takes over 5 billion won. After working on a drama for several years, the production company is left with only about 300 million won."

The dissatisfaction is clearly reflected in survey results. Regarding terrestrial dramas, broadcasters believe the production budget paid to production companies is sufficient (4.33 out of 5 points). In contrast, production companies strongly disagree, claiming the budget is severely inadequate (2.33 points) and that inflation is completely ignored (2.33 points). The perception gap between the two groups is as much as 2.00 points.

Drama filming site. Photo is unrelated to the article content.

Production companies cited the primary reason for insufficient budgets provided by broadcasters as 'the unit cost of production expenses is set far too low compared to the current situation.' For the top priority for adjustment, they pointed to staff wages (41.7%) and planning fees (33.3%), strongly demanding improvements in the treatment of on-site staff. There is a widespread concern that, overshadowed by skyrocketing actor fees, the wages for essential technical staff such as camera and lighting crews have remained at similar levels to those of five to seven years ago.

The government's 'standard production cost calculation criteria,' recommended in the name of mutual cooperation, have long become useless in practice. Although 66.7% of terrestrial broadcasters responded that they had presented these criteria, in reality, it was little more than an administrative formality. Top star appearance fees have an absolute impact on budget decisions, and the unit costs for lighting and staff wages fluctuate constantly. Under such conditions, a calculation table stuck at levels from 20 years ago cannot serve as a basis for negotiation. Even a broadcaster official, Mr. C, admitted the limitations of the system, saying, "We prepare as required by the outsourced production guidelines, but since costs like lighting and wages are so variable and top star appearance fees have a decisive impact on the budget, it is practically impossible to follow the calculation criteria as they are."

Ultimately, broadcasters are unable to escape deficits within this outdated system, while production companies are forced to squeeze their staff under inadequate budgets, perpetuating a vicious cycle. In the Korean content market increasingly dominated by global capital, fundamental structural reform is urgently needed to put an end to this exhausting 'zero-sum game' over production costs between broadcasters and production companies. Practical measures, such as discussions on appearance fee caps, the realization of standard production costs, and improvement in the treatment of technical staff at production companies, must be swiftly implemented to normalize production budgets.

This content was produced with the assistance of AI translation services.