The free trade agreement with the United States will have little effect on both traditional and new media markets, U.S. specialists said yesterday.
In a special seminar to kick off the three-day Seoul Digital Forum held at the Sheraton Walkerhill in eastern Seoul, Columbia University economics professor Eli Noam and Boston Consulting Group senior vice president Philip Evans spoke on the U.S. FTA and its impact on media.
“FTAs have less effect on media than the imagination of critics. Media have different economics than industrial or agricultural products and are not much governed by FTA-style agreements,” Noam said.
He divided the media into three categories ― content, distribution, and devices ― and said that the FTA would not largely affect any of those sectors. “Hardware is already highly open and market access to Korea for content, such as falling quotas, has been happening anyway,” Noam said. “Broadband and other distribution makes quota reductions obsolete anyway. Intellectual property rights protection is happening anyway, and [such rights] are unenforceable anyway,” he added.
Both specialists mentioned that the FTA would have an impact on content with low domestic effects but potential global impact, such as interactive games that can be played around the world. Evans said that businesses that are significantly locally based, including traditional media such as newspapers, will not be affected by the FTA.
He also emphasized that new media businesses, such as television, music and most notably, video games, are emerging forms of media that are not controlled by a specific company or country. The impact of removing trade barriers, he said, usually depends on the tension between local and global bases of competitive advantage, but that user-created content throws doubt on that point of view.
Giving the example of the virtual world Second Life, Evans pointed out that although it was established by a U.S. firm, the value of the content, which is created by global users including Koreans, is 10 times more than the initial investment. “New media are thus accommodating global and local advantages independently of international legal and tariff arrangements,” he said.
by Wohn Dong-hee for JoongAng Daily