This week, the LA Times published a truly eye-opening report about Netflix’s impact on South Korea’s TV and film industry. Unfortunately, it’s not pretty. Even more unfortunately, South Korea’s globally beloved TV and film industry has been plagued by exploitative practices from the start. Still, one would assume that Squid Game creator Hwang Dong-hyuk received some compensation for delivering Netflix its most-watched series ever. But that is not so.
Instead, Hwang was paid a flat fee upon delivery of Squid Game. In 2021, Hwang told The Guardian, “I’m not that rich. But I do have enough. I have enough to put food on the table. And it’s not like Netflix is paying me a bonus. Netflix paid me according to the original contract.”
In other words, Hwang hasn’t received anything from Squid Game becoming a mega-hit. Hwang has never seen a single cent in residuals, and he forfeited all his intellectual property rights in his contract. So those Funko Pops of the guards from the series? Literally all of that licensing money went straight to Netflix—and no one else. The small piece of good news for fans is that Hwang not having the property rights to his own show means he wasn’t involved in the disastrous upcoming Squid Game reality show. That reality show in and of itself is truly one of the darkest and most cynical moves in modern capitalism.
So it probably won’t surprise you to learn that the LA Times report found that Squid Game increased Netflix’s value by a whopping $900 million.
Unsurprisingly, Netflix’s response isn’t great. But to appreciate just how lacking the response is, we should zoom out to look at the larger picture the LA Times report paints of the South Korean film industry.
A horrid industry standard in South Korea
Unfortunately, the norm for the South Korean TV and film industry wasn’t great even before Netflix came in. The most shocking example to me in the LA Times‘ report is the loose definition of a “day rate.” A single “day” meant merely unbroken stretches of filming, so shoots could exceed 24 hours and just be counted as a single day with no overtime. Some shoots were logging 130 hours a week.
The South Korean government did step in to try to stop this, looping in the film industry with a law that capped the work week at 40 hours with up to 12 hours of overtime. Unfortunately, that law is simply ignored by a lot of South Korean production companies. And Netflix hires those companies to make its shows.
Very similar to the US, most workers in the film industry are considered freelance contractors, which means they don’t have labor protections. “Because companies are not obligated to bargain with unions made up of freelancers, the Broadcasting Staffs Union is powerless against these practices,” the LA Times reports. “With no binding agreement in place, workers are left to fend for themselves.”
In fact, Netflix has used Squid Game to prove that quality television can be made on the cheap. Here, “cheap” means “unpaid labor,” and lots of it. The LA Times spoke with Kim Ki-young, the president of the union representing production crews in South Korea: “It all comes down to labor costs. There is a staggering amount of unpaid labor being done.”
There are truly an astonishing number of examples in the LA Times piece, so I heartily suggest reading the full report. But to give you a taste: one producer said they were paid a flat monthly rate that was understood to break down to 52 hours a week—a 40-hour week with 12 hours of overtime. But specific tasks were “strategically excluded” from being counted as work. The producer told the LA Times, “I was paid around $3,400 a month at the time. I’d say I worked somewhere between 90 to 100 hours a week.”
Some production companies exclusively define work hours as when the camera is rolling. Anyone who’s ever worked on a set will tell you that filming accounts for only a fraction of the work done. Untold hours of setup and prep work go unpaid.
Netflix’s bad excuse
So, what did Netflix have to say to the LA Times about all of this?
“We pay fair, highly competitive rates with our K-Content creators and set clear standards for our Korean production partners, who produce all our shows and movies. These standards meet or exceed Korean law.”
As we’ve seen, this is simply not the case. It might even be less of an “excuse” and more of a bald-faced lie. And remember, South Korean creators like Hwang Dong-hyuk receive absolutely no residuals, and Hwang forfeited his intellectual property rights to Squid Game.
Granted, working on a Netflix production pays a bit better and allows for more creative freedom than the average South Korean television production. But that’s kind of like saying this moldy piece of fruit is better to eat than the moldy piece of fruit with flies buzzing around it. I’d love a piece of fruit that guaranteed capping the work week at 52 hours, without an extra 40 hours of unpaid labor.
Hope for the future
Fortunately, there are several ways in which this situation could change. While the results of the ongoing WGA strike won’t necessarily affect South Korean Netflix productions, it’s worth mentioning that residuals are one of the key issues at stake. This is also true for members of SAG-AFTRA, who are poised to go on strike as well. Residuals aren’t “zero” for US creators, writers, and actors like they are for their South Korean equivalents. At least, not always. But if they do get residuals, they can be as low as six cents—worse than what Spotify pays musicians.
The situations aren’t wholly unrelated. With no end currently in sight for the WGA strike, and with SAG-AFTRA seemingly adding fuel to the union rights fire, streaming companies like Netflix are looking to foreign production partners to make up the gap in content. For Netflix in particular, South Korea is key. But South Korean workers seem just as fed up as their American counterparts.
Netflix co-Chief Executive Ted Sarandos recently said during a trip to South Korea, “In the case of a show’s success, we make sure that creators are compensated in a right manner in the next season.” Consequently, Hwang said he got a “good deal” for Squid Game‘s upcoming and highly-anticipated second season—though he’s likely talking about a flat rate for delivering the series.
Sarandos also said Netflix is exploring “alternative solutions” to residuals and intellectual property copyrights—meaning Netflix is looking to do anything else besides just giving Hwang a piece of his own pie. Which might explain why, earlier this year, Hwang made a speech at South Korea’s National Assembly in support of a bill that would made it illegal to not give residual payments to creators. The National Assembly is also looking into a law that would change the definition of “employer” in such a way that companies like Netflix would be required to negotiate with unions.
I hope all these measures and strikes succeed. I would like it if someone in South Korea could make a show without sleeping only three hours a night.
(featured image: Netflix)
