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TV fees disconnected from electricity bills in public broadcasting shake-up

The Korea Communications Commission (KCC) will no longer automatically add the TV transmission fee to the monthly electricity bill of households.

The KCC said on Wednesday the Broadcasting Act enforcement ordinance has been changed to separate the charging of the TV transmission fee from electricity bills.

After three decades of the combined charging approach, the final approval came a month after it was first recommended by the president’s office on June 5.

Two commission members approved the change — Vice Commissioner Kim Hyo-jae, who is currently acting as the head of the agency, and Commissioner Lee Sang-in. The third member Kim Hyun, who is on a hunger strike over the fee changes, walked out of the meeting in protest.

In a statement, the KCC noted that although adding the TV transmission fee since 1994 has contributed to funding the public broadcaster Korean Broadcasting System (KBS), the change was necessary.

“The people weren’t aware that they were paying [the TV transmission fee] and even if they did it was difficult [for individuals] to separate the electricity bill from the fee,” the KCC statement said.

“By separating the electricity bill with the transmission fee, people will now know if they are being charged and the specific amount being charged.”

The approved amendment will be submitted to the deputy ministers meeting led by the Office for Government Policy Coordination before going to the ministers’ Cabinet meeting, then receiving final approval by President Yoon Suk Yeol.

KBS and Korea Electric Power Corp. (Kepco) will then start negotiating a new contractual arrangement, with the current contract between the two expiring at the end of next year.

KBS immediately release a statement criticizing the decision.

The broadcaster argued that KCC has a procedural problem and it needs more time for a wider social discussion regarding public broadcasting.

“Even if we put aside the justification of the online vote results that was used as the foundation to the presidential office’s recommendation, the KCC’s legal notificaton period, which could determine the existence of public broadcasting, was just 10 days, one-fourth of the 40 days under the admistrative procedual law,” the KBS statement read.

The KCC legal notice on the changes was issued on June 16.

The broadcaster also argued that the KCC refused, without reason, KBS’s request to have an open hearing where it can defend itself. It also did not accept the concerns raised by Kepco, including the massive losses inflicted on the power company and the confusion of having to separately pay the TV transmission fee.

Among the 2,500 won ($1.93) TV transmission fee charged, Kepco takes 6 percent as commission on billing households.

KBS takes the main portion of 91 percent and the Educational Broadcasting System takes 3 percent.

Last year Kepco made 46.7 billion won from the TV transmission charge.

KBS submitted an injunction against the amendment separating the fee to the Constitutional Court on June 21.

The issue of TV transmissions being charged on the electricity bill became a hot topic in recent years as many were unaware of paying 2,500 won every month.

The transmission fee was also considered “double taxation” as a majority watch public broadcasts through pay-TV including Internet Protocol Television, or IPTV, services.

As of the third quarter of 2022, pay-TV subscribers amounted to 36 million, equivalent to 70 percent of the Korean population.

In a survey conducted by the president’s office between March and April, 96.5 percent of the 8,251 people surveyed supported the billing separation.

The changes are expected to land a heavy blow to KBS as the TV transmission fee has provided a steady cash flow, accounting for 45 percent of last year’s revenue at 693.5 billion won.

Revenue from the transmission fee was 7.1 billion won more than a year ago.

Earnings made through other sources such as advertising have also been shrinking. Last year, KBS made 264.2 billion won in advertising, compared with the 623.6 billion won made in 2012.

In 2021, the broadcaster tried to hike the transmission fee to 3,800 won, a 52 percent increase.

One issue has been the wages of KBS employees. According to a report last year by the office of Democratic Party Rep. Yoon Yang-chan and based on data provided by KBS, in 2021 51.3 percent of its 4,629 employees received more than 100 million won a year, up from 46.4 percent of employees in 2020.

While the number of employees has shrunk from 4,800 in 2020, those included in the 100 million won club have increased.

The average annual paycheck of KBS employees in 2021 was 101 million won.

In recent years, KBS has been accused of biased news reports and shows that lean in favor of the Democratic Party.

“KBS is well aware of the criticism that has led to the situation that we face today,” the broadcaster said in its statement on Wednesday. “In some part, we lacked the efforts and ability and in some areas, there were limits to KBS’s own efforts without a systematic backup.

“We are looking back at our mistakes and plan to come up with measures that the people could accept, especially on fairness and management efficiencies.” Korea JoongAng Daily

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