Yes, that is right. Read the error message: "The full-text catalog does not exist by default or the user does not have permission to perform this action." I'm not sure how anyone can make this more clear. :)
You need to use CREATE FULLTEXT CATALOG to create a default full-text directory before you can CREATE FULLTEXT INDEX into this directory. If you have done this, you need to make sure that the user has GRANT permissions that allow you to create full-text indexes.
See SQL Server CREATE FULLTEXT CATALOG (BOL) and finding a CREATE FULLTEXT CATALOG in an index. Or you can use this link to install BOL locally.
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