OTT 3 Companies Losing Music Copyright Royalty Lawsuit "Immediate Appeal"

TVING, Wavve, Watcha "Collection Rules Biased Toward Rights Holders Must Be Reexamined"

[Asia Economy Reporter Oh Su-yeon] The three OTT platforms Tving, Wavve, and Watcha, which lost the first trial in the administrative lawsuit over the increase in music copyright fees for online video services (OTT), announced that they will immediately file an appeal.

On the 23rd, the three OTT companies stated, "We respect the judgment of the Administrative Court, but it is regrettable that the case was concluded without an in-depth review of procedural issues and substantial illegality during the trial process."

The Seoul Administrative Court, Administrative Division 1 (Chief Judge Kang Dong-hyuk) ruled against the plaintiffs in the lawsuit filed by the three OTT companies against the Ministry of Culture, Sports and Tourism, seeking to cancel the approval of the revised regulations on the collection of music copyright fees.

In December 2020, the Ministry of Culture, Sports and Tourism approved the revised regulations to increase OTT music copyright fees. The revision included raising the rate from 1.5% initially to 1.9995% by 2026, which sparked opposition from operators. They argued that it was excessive compared to the 0.5% of total broadcasting revenue set for comprehensive cable TV operators (SO) or the 1.2% of sales for Internet Protocol TV (IPTV). Additionally, they claimed that the Ministry did not sufficiently gather opinions from the OTT industry.

The consortium plans to form a united front with the IPTV industry as they proceed with the appeal. "We will immediately begin preparing for the appeal and plan to discuss joint cooperation with the IPTV industry, which is also engaged in litigation on the same issue," they said.

Regarding this lawsuit, they added, "Despite serious bias revealed in the Ministry's review process and results related to the revised music copyright fee collection regulations, the OTT industry had no means to raise objections and was forced to file an administrative lawsuit. If the Ministry seriously intends to reconsider the excessively rights-holder-biased revised music copyright fee regulations, the administrative lawsuit can be withdrawn at any time."

Meanwhile, KT, which operates the OTT service 'Season,' and LG Uplus, which operates 'U+ Mobile TV,' also filed lawsuits on the same issue but lost the first trial in October.