KBS Forecasts Deficit of 73.7 Billion Won

The Korean Broadcasting System (KBS) estimates that its 2007 deficit will reach a record high of 73.7 billion won ($81 million).

Following the appointment of Jeong Yeon-ju as the new president of KBS, it posted a record loss of 63.8 billion won in 2004.

The public broadcaster received 4.3 billion won in subsidies from the government and 6.0 billion won from the Korean Broadcasting Commission (KBC)’s broadcasting promotion fund to reduce the 2004 budget deficit.

KBS also forecasts a deficit of 132.0 billion won in 2008, 214.3 billion won in 2009 and 278.6 billion won in 2010, according to a report that Grand National Party Rep. Shim Jae-chul disclosed Sunday.

Although KBS internal reports suggest a deficit of tens of billions of won, a profit of 1.15 billion won is forecast in the projected financial statements it submitted to the KBC to renew its license in August of this year.

The viewer rating of KBS 2TV dropped to 5.97 percent as of September, down 0.82 percent from 6.79 percent in 2006. As a result, its advertising revenue has decreased by 60.2 billion won as of October compared to the same period last year. Meanwhile, its income from TV license fees hit 267.0 billion won in the first quarter of this year, up 2.3 billion from the previous year and more than 400 million won than its goal.

This year’s labor costs for KBS are expectedly to increase by 15.2 billion won, according to a financial report Shim obtained from KBS. The production costs for dramas and entertainment programs have also increased by 14.3 billion won. However, the debt-ridden broadcaster is considering giving a gift or a gift certificate worth 200,000 to 300,000 won to each employee on its foundation day, and introducing special incentives.