Billboard Pro : Korean Music Companies Are Exporting More Than K-Pop - How They’re Changing the Global Music Business

The next step in K-pop's growth may lie not in music itself, but in exporting K-pop's disciplined development, production and promotion model.

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South Korean music companies have become international powerhouses by drawing on hip-hop, R&B and pop music and selling the K-pop blend of these genres back to fervent fans in the United States, Japan and Europe. But to compete globally with larger companies, the South Korea approach to the music business, and not necessarily the music itself, could be the deciding factor. “We’re seeing not only the export of K-pop bands — the boy bands, the girl bands — we’re starting to see the export of the K-pop business model,” says Bernie Cho, president of DFSB Kollective, a Seoul-based artist and label services agency. SM Entertainment founder Lee Soo-man coined the term “cultural technology” in the ’90s for his system of producing K-pop and promoting it worldwide. Other K-pop companies have adopted a similarly disciplined, systematic approach to finding, developing and promoting musicians.

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South Korean music companies’ do-it-yourself nature extends to tech platforms, too. While most labels depend on the likes of Meta, Twitter and Fortnite to reach fans, HYBE owns its own social network, Weverse, and JYP and SM have a joint venture with tech company Naver called Beyond LIVE that streams live online concerts. SM also owns a social networking app, Bubble, and its artists will begin building fan communities at HYBE’s Weverse in September. It makes sense in one of the world’s most wired and wireless countries, says Cho of DFSB Kollective. In Korea, “youth culture, pop culture and digital culture are one and the same in many ways.”

For HYBE, Weverse not only diversifies its business but allows it to control how its artists communicate with their fans. With the addition of artists from North America and Japan, Weverse “will serve as a gateway to the fandom market in Asia, North America and the world,” says Park. With enhancements and new services, “Weverse will seek boundless expansion beyond K-pop.”

This story originally appeared in the April 22, 2023, issue of Billboard

https://www.billboard.com/pro
By Glenn Peoples

Featured Commentator : Bernie Cho [DFSB Kollective]

Billboard Magazine : Why K-Pop’s Success Transcends Hit Singles

Illustration by Glenn HarveyWith BTS on hiatus and singles less dependable smashes than albums, Hot 100 domination still eludes many big K-pop acts. But is it even crucial to their success?

This story is part of Billboard‘s K-Pop Issue.

n March, HYBE founder/chairman Bang Si-hyuk issued a dire warning: “K-pop,” he concluded, “is in crisis.” HYBE is the music company behind BTS, the group that spearheaded K-pop’s dramatic international growth in recent years, but Bang sounded alarmed about the genre’s health. K-pop’s momentum was faltering, he said, claiming fewer tracks from the genre charted on the Billboard Hot 100 in 2022 than in 2021. The following month, BTS’ Jimin released his solo debut album, and the single “Like Crazy” arrived at No. 1 on the Hot 100. Still, his comments dovetailed with general industry anxiety about the dearth of new acts breaking into the mainstream and the challenge of maintaining growth in a ferociously competitive landscape, where around 100,000 new songs hit streaming services daily.

Within K-pop, some executives are concerned about the extent to which the genre can continue to produce massive international hits without BTS’ firepower while the group is on hiatus. “Although I wouldn’t go so far as calling it a ‘crisis,’ I do share [Bang’s] underlying sense of urgency that the Korean music industry is very much at an important crossroads,” says Bernie Cho, president of DFSB Kollective, a Seoul-based artist and label services agency.

K-pop’s ascent to global prominence was, Cho says, “inextricably linked [with] and heavily reliant on the singular artistic visions” of executives at a few key companies — notably SM Entertainment, YG Entertainment and JYP Entertainment. “It has become an open source of debate these days, from boardrooms to chat rooms, that steadfastly sticking to this single-lane approach may no longer be the right direction” if the industry hopes to “futureproof” K-pop.

Executives who work in and around the genre are quick to pinpoint one big reason for the recent lack of K-pop in the upper reaches of the Hot 100: In June 2022, BTS — which has topped the chart four times on its own and twice more as a collaborator with Western artists — announced its potentially yearslong hiatus. “Their vacancy is definitely going to put a bit of a hole in the market,” says Eddie Nam, CEO of EN Management (Eric Nam, Epik High).

But there’s disagreement on whether hit singles in the United States are the best gauge of the genre’s health in the first place. On the Billboard 200, K-pop albums continue to hit No. 1 thanks to robust physical sales of CD variants; last year, K-pop groups topped the chart four times — Stray Kids twice and BTS and BLACKPINK once each — setting a new high-water mark for K-pop. “Most K-pop groups are built on a strong fan base, and their loyalty and support for their artists is much more organized than in the past,” says YG Entertainment USA’s former president Joojong Joe. “These fandoms know that Billboard chart positioning is important to their artists, and they organize album purchases and promotion within their fandom in the first week of an album’s release in order to get it to the top of the charts.”

But recently, K-pop acts haven’t scaled the same heights on the Hot 100. The biggest recent non-BTS K-pop hit was BLACKPINK’s “Pink Venom” last year, which peaked at No. 22. In the United States, the genre’s singles often perform phenomenally on the downloads chart — mirroring their dominance in physical sales — but less well on the streaming and radio rankings. “Like Crazy,” for example, sold 254,000 downloads, easily topping Digital Song Sales, but clocked in at No. 35 on the Streaming Songs chart. BTS’ previous No. 1, the Coldplay collaboration “My Universe,” also topped Digital Song Sales in its first week but landed at No. 21 on Streaming Songs.

Getting airplay in the United States remains K-pop’s biggest challenge: BTS has spent 17 cumulative weeks atop the Hot 100 but hasn’t made it past No. 5 on Billboard’s Pop Airplay chart, and BLACKPINK hasn’t even cracked the top 20 on Pop Airplay. The airplay audience for “Like Crazy” is the lowest for a Hot 100 No. 1 this decade. “I don’t think we’ve seen Korean music take over U.S. radio in any way,” Nam says. This remains true even as most of the biggest K-pop acts now work with American major labels, which have long-standing radio promo teams.

As Joe points out, K-pop artists aren’t necessarily so different from others outside the United States when it comes to that airplay disadvantage. “You’re in the country for promotion for only a short amount of time,” he explains. “You have to prioritize — you have a late-night show on TV; you have a concert; you have a photo shoot. It takes a lot of time to build relationships at radio, and it has not been easy for Korean artists to do that in the short amount of time they have here.”

In addition, many K-pop singles are only partially in English, which may make them a tougher sell at radio — a medium not known for taking risks. (Bad Bunny is one of the biggest artists in the world, but he has never made it past No. 19 at pop radio as a lead artist.) Three of BTS’ biggest hits were entirely in English; two others were collaborations with prominent Western acts singing in English.

Others, like Michael Martin, senior vp of programming for Audacy, the second-largest radio company in the United States, dismiss the idea that language might be limiting K-pop’s airplay. Representatives for two other prominent radio conglomerates, iHeartRadio and Cumulus, declined to comment on K-pop airplay, though iHeart has been supporting rising acts like NewJeans, especially in cities on the West Coast, and had some of the few stations that played “Like Crazy” during its debut week.

However, there’s also an argument that in an increasingly global music marketplace, hits are no longer the most important indicator of a genre’s health — and that K-pop’s difficulty getting U.S. radio play ultimately doesn’t matter to its momentum. “I don’t think K-pop groups must have hit singles in the U.S. to succeed globally,” says Inkyu Kang, an associate professor at Penn State and the author of K-Pop: The International Rise of the Korean Music Industry. “K-pop had already been enjoyed by people around the world with diverse backgrounds before it reached the U.S.”

Those listeners continue to seek out music from the genre: K-pop groups accounted for four of the top 10 albums in the world last year, according to the most recent report from IFPI, up from two in 2020. Looking just at sales rather than overall consumption, K-pop acts have a whopping eight out of the top 10, up from four in 2020. “Last year, the K-pop industry had the highest album sales overseas in history,” though growth in album sales slowed significantly, says Stephanie Choi of SUNY Buffalo’s Asia Research Institute, who is working on a book on K-pop. Japan, China and the United States were the three biggest importers of K-pop albums.

“You have to look at the whole pie,” says Lucas Keller, who manages Jenna Andrews, co-writer of BTS’ runaway hit “Butter.” “K-pop has one of the most committed fan bases in the history of music. You have to look at the touring, the merchandise and the audience, not just the charts.”

“When I speak to folks in the industry,” Keller adds, “we all believe that Korean pop acts have a real seat at the table now — including a shot at Western success in a way that was more difficult in past years.”

This story originally appeared in the April 22, 2023, issue of Billboard.

https://www.billboard.com/music/features
By Elias Leight

Featured Commentator : Bernie Cho [DFSB Kollective]

Billboard Magazine : Ballad, Trot, OSTs and More - Get To Know Other Genres Big in Korea

Younha @ C9 EntertainmentSouth Korea's vibrant music scene is packed with artists far beyond those in idol groups.

This story is part of Billboard‘s K-Pop Issue.

What exactly is K-pop? Internationally — and especially in the West — the term has become synonymous with girl groups and boy bands (“idol groups” in K-pop lexicon). But some Korean music industry executives argue that the genre should have a broader definition. “K-pop is less about a specific style and more about a representation of what happens to be hot in Korea,” says Bernie Cho, president of DFSB Kollective, a Seoul-based Korean artist and label services agency. “Right now, similar to the U.S. charts, a wide range of genres in Korea is currently popular and therefore, by default, K-pop.”

Indeed, South Korean popular music encompasses much more than idol groups. The country’s vibrant scene is packed with artists from different genres, many of whom are backed by smaller labels that lack the resources to heavily promote them abroad. In fact, idol K-pop isn’t even the most popular type of music in South Korea ­— more on that below, along with the other major genres that Koreans are listening to these days.

ALTERNATIVE/ROCK

South Korea’s rock history began in the 1950s, when American soldiers fighting in the Korean War played rock’n’roll on military bases, influencing musicians such as “The Godfather of Korean Rock,” Shin Joong-hyun. In the ensuing decades, numerous folk-rockers like Song Chang-sik and legendary bands like Sanullim, Deulgukhwa, Songgolmae and Sinawe emerged, ushering in a golden age of Korean rock by the ’80s. Punk acts like Pippi Band, Crying Nut and No Brain started Korea’s mid-’90s indie-rock renaissance.

Artists to Know: Jaurim, best known internationally for appearing on K-drama Twenty Five Twenty One’s soundtrack, is Korea’s longest-performing coed band and a national rock icon. Jannabi’s 2019 classic “for lovers who hesitate” continues to chart domestically.

Jaurim @ Interpark EntertainmentJannabi @ Peponi Music ADULT CONTEMPORARY

Known as “ballad” in Korea, adult contemporary is by far the most widely enjoyed genre among Koreans of all ages. Ballad has been popular in the country since the 1980s and varies in style from R&B to dance to rock.

Artists to Know: With his velvety vocals, Sung Si-kyung is Korea’s long-reigning “King of Ballads,” and singer-songwriter YOUNHA is renowned for her rock-infused ballads and anthems.

TROT

The oldest form of Korean popular music — “kind of sort of like Korean country music,” Cho says — borrows its name from “foxtrot” and blends traditional Korean folk songs, Japanese enka, blues, swing, jazz and other Western genres. Trot had its heyday in the ’60s and ’70s, then declined during the ’90s. But in recent years, it has been revived thanks to TV competitions like Miss Trot and Mr. Trot, which have introduced the genre to younger audiences. (Still, trot remains most popular among Koreans over 50.)

Artists to Know: Singer-songwriter Na Hoon-A helped shape the genre into what it is today, and Young Tak is known for catchy trot songs that appeal to Koreans of all ages.

Young Tak @ Kakao Entertainment CorpSOUNDTRACKS

Soundtracks, or “OSTs,” to Korean films and K-dramas are considered their own genre, partly so viewers can easily find music used in scenes and partly because many K-drama songs are created specifically for certain series, explains Lim Ha-young, music director for Twenty Five Twenty One and other hit K-dramas. Since the shows are so popular, “OSTs make up at least 10% of the songs on domestic K-pop charts at any given time,” Lim says.

Artist to Know: 10CM’s contributions to soundtracks for Our Blues, Crash Landing on You and many other popular K-dramas have led some to call him a “one-man OST god.”

10CM @ Magic Strawberry SoundDANCE/ELECTRONIC

While idol groups have performed most of the recent dance hits in Korea, there have been many notable exceptions, such as AKMU’s “NAKKA,” Lee Chanhyuk’s “Panorama” and PSY’s “That That.” And “there are also Korean artists who are positioned as dance/electronic artists, similar to Tiësto and David Guetta in the Western music industry,” says Shin Cho, head of K-pop and J-pop, Asia for Warner Music Korea.

Artist to Know: Best known internationally for his 2018 single “Way Back Home,” singer-songwriter, producer and DJ SHAUN was Spotify’s most streamed K-pop male solo artist from 2018 to 2020.

Shaun @ 285 RecordsHIP-HOP

Groups like Seo Taiji and Boys and Deux helped introduce rap to Korea in the early ’90s, and hip-hop pioneers like Drunken Tiger, Jinusean, 1TYM and Epik High subsequently brought it into the country’s mainstream. Rap competition shows in the 2010s like Show Me the Money launched the careers of many Korean hip-hop artists and further popularized the still-influential genre. “The prominent hip-hop musicians in Korea certainly influence the K-pop industry as a whole, in sound, fashion and taste,” says Tablo, Epik High’s leader.

Artists to Know: BE’O skyrocketed to fame after appearing on Show Me the Money 10 in 2021 and is now one of Korea’s hottest hip-hop stars. Rapper-producer CHANGMO swept the 2022 Korean Hip-Hop Awards.

Changmo @ Ambition MusikBE’O @ Big Planet Made Ent.R&B/SOUL

“R&B mixed with soul really took off in Korea in the mid-to-late 1990s,” noted Korean music critic Woojin Cha explains. Korean American trio Solid is often credited with introducing the genre to Korea. R&B/soul is also sung by K-pop idols and ballad singers alike.

Lee Hi @ AOMGArtists to Know: LeeHi is known for her unique husky voice, and alternative R&B singer-songwriter DEAN has written for K-pop idol groups and fellow R&B artists.

This story originally appeared in the April 22, 2023, issue of Billboard.

https://www.billboard.com/music/pop
By Regina Kim

Featured Commentator : Bernie Cho [DFSB Kollective]
Featured Artists : Crying Nut [Alternative/Rock] / Solid [R&B/Soul]

FT Financial Times : K-pop’s movers and shakers fight to create dominant music agency

The handling of K-pop stars such as Blackpink was traditionally dominated by the SM, JYP and YG music agencies — until Hybe went to number one with BTS © Amy Harris/Invision/APHybe, which represents boy band BTS, is in a battle for control of former industry leader SM Entertainment

Korean pop music’s irresistible international growth has triggered a bitter corporate battle that is reshaping the country’s entertainment industry, as rivals battle for control of its most storied talent factory.

Market leader Hybe, the company behind megastar boy band BTS, last week bought 15 per cent of its main rival SM Entertainment from the country’s best-known K-pop impresario, SM founder Lee Soo-man.

Hybe wants to increase its stake via a tender offer to other investors and argues it can create a national entertainment champion, capable of taking on US giants Universal Music, Warner Music and Sony Music.

Lee Soo-man, a septuagenarian “super producer” who reportedly had been long opposed to selling to his main competitor, changed his mind after a spectacular falling out with SM’s board. It had disowned him last month over allegations of tax evasion and improper influence over company directors.

Led by Lee Soo-man’s nephew, the board has instead pursued an alliance with the entertainment subsidiary of local tech giant Kakao, which announced a deal earlier this month to buy a 9 per cent stake in the company.

Describing his ousting as a “military operation”, Lee Soo-man, who holds no formal position within the company, has filed an injunction to block Kakao’s share purchase.

The K-pop industry had long been dominated by three music agencies — SM, JYP and YG Entertainment — before BTS rose to global stardom and made Hybe the sector’s dominant player.

“This is like if Real Madrid tried to buy Manchester United, then at the last minute Manchester City decided to throw its hat into the ring,” said Bernie Cho, president of DFSB Kollective, a digital media marketing and distribution agency based in Seoul and Los Angeles.


While Hybe’s market capitalisation of Won 7.9tn ($6bn) dwarfs SM’s Won 2.9tn valuation, analysts argue that the larger company remains over reliant on BTS. The band’s seven members, most of whom are in their late 20s, recently went on hiatus in order to complete their compulsory military service.

SM, by contrast, is seen as having a much more diversified portfolio, with its artists generating strong sales in overseas markets including Japan, China and south-east Asia. In 2022, the company reported a 38.5 per cent rise in operating profit as sales rose 20.9 per cent to Won 848bn.

“For Hybe, the key is to diversify its content,” said music critic Kim Young-dae. “SM has been a role model of Hybe for a long time, so taking over the company was an opportunity Hybe could not miss out on.”

But SM is also hotly coveted by Kakao, which is engaged in a struggle with arch-rival Naver to acquire content that will drive users to a new generation of distribution platforms.

Kakao Entertainment’s proposed alliance with SM mirrors a similar tie-up between Naver and SM rival YG Entertainment, the company behind girl group sensation Blackpink. Naver is also working with Hybe to co-develop online concert and fandom portals.

“Kakao Entertainment needs to boost its corporate value before a future public listing, and SM is the perfect M&A candidate to strengthen its artist portfolio,” said Jeong Kwang-woo, an expert in the Korean music industry.

SM’s board strongly objects to what it describes as Hybe’s “hostile takeover”. Hybe has submitted a tender offer to purchase a further 25 per cent stake from minority shareholders, which would bring its stake to 40 per cent.

That would give Hybe effective control of SM despite holding a stake of less than 50 per cent, because of the number of shareholders who do not vote or engage in the running of the company.

Daniel Jang, SM’s chief financial officer, told the FT that Hybe’s control of SM in this way would result in a “blatant conflict of interest”.

“When there is tension between the interests of Hybe and the interests of SM, Hybe’s management can either serve the interests of Hybe shareholders, or the interests of SM shareholders — but they can’t serve both,” said Jang.

Hybe denies engaging in a hostile takeover. In an open letter published on Wednesday, the company’s chief executive Jiwon Park said that under its proposals, “Hybe will actively support SM artists’ endeavours in making a presence in the global music industry”.

Opponents of the Hybe takeover have also raised competition concerns. Analysts estimate that Hybe and SM together would account for two-thirds of K-pop album and digital music sales.

Another key question for shareholders at SM’s annual meeting next month will be whom they trust most to clean up the governance issues left behind by the company’s founder, who retains a 3.65 per cent stake.

Earlier this month, SM’s co-chief executive Chris Lee released a video statement explaining why the board had broken with the mogul.

In addition to allegations of tax evasion and financial mismanagement, he accused Lee Soo-man of using a tree-planting campaign in Saudi Arabia and Mongolia as a front for building an overseas K-pop-themed property empire replete with hotels and casinos.

Lee Soo-man’s legal representatives have denied the allegations. The FT was not able to reach him for comment.

In his statement, Hybe chief executive Park pledged that “SM will be moving to become a company with a transparent governance structure that prioritises shareholder value”.

But SM’s CFO Jang argued that Hybe could not be trusted to implement governance measures, citing what he described as Hybe’s own poor governance record.

“Hybe has announced governance measures for SM that it does not follow within its own company,” said Jang. He said SM’s board deserved credit for breaking with Lee Soo-man, whom he described as having behaved like an “emperor” as he exerted his influence from behind the scenes.

“Hybe’s transparency and excellency of its governance structure is undoubtedly the model to follow in the industry,” a Hybe spokesperson told the FT. “Nevertheless, we continue to look for room for further improvement.”

https://www.ft.com
By Christian Davis & Song Jung-A

Featured Commentator : Bernie Cho [DFSB Kollective]

CNN : BTS Agency HYBE Buys STake in its K-Pop Rival

NCT 127 at a press conference in September 2022 in Seoul.[Seoul/Hong Kong] HYBE, the management agency behind superstar boy band BTS, will become the biggest shareholder of its K-pop rival, SM Entertainment.

The move strengthens HYBE’s dominance in South Korea’s music industry, where it is already the biggest player, even as it seeks to expand abroad.

The South Korean entertainment giants announced the deal Friday, with HYBE set to pick up a 14.8% stake in SM Entertainment for 422.8 billion Korean won ($334.5 million).

SM was founded by legendary music producer Lee Soo-man, who is widely referred to in South Korea as “the godfather of K-pop.” The company is known for representing hit artists, such as NCT 127, EXO, BoA and Girls’ Generation.

News that the two companies were joining forces fired up investors. SM Entertainment’s shares soared 16% in Seoul on Friday. HYBE’s stock initially rose 3%, before paring gains to close down 1.5%.

Outside of BTS, HYBE also represents prominent bands such as NewJeans, Tomorrow x Together and Seventeen.

But its marquee act is currently on hiatus. Members of BTS started individual compulsory military service in South Korea late last year, and the group as a whole is expected to reconvene around 2025.

Now, HYBE is turning its attention elsewhere.

“This acquisition represents a major step by HYBE to integrate the global expertise of both companies to become a game changer in the global music industry,” the company said in a statement.

HYBE has been taking steps to expand its global reach. On Thursday, it announced another major deal in the United States, saying it would acquire the owner of Quality Control, a hip-hop label that represents popular artists including Migos and Lil Yachty.

That deal will help HYBE build a stronger presence in the US music market, according to Sunhwa Lee, an internet and entertainment analyst at KB Securities. In a report Thursday, she noted that the company’s broader ambitions were “to go beyond the boundaries of K-pop and develop new global artists across various genres.”

“This partnership is a vital part of our growth plan to innovate the entertainment industry through a diversified portfolio,” HYBE Chairman Bang Si-Hyuk said in a statement. “We will work together to continue adding depth of hip-hop to the global music industry.”

'ONE-TWO PUNCH'

Bernie Cho, a Seoul-based music industry executive, said the two deals announced were unlike anything he’d seen.

This “may be the biggest one-two power punch I’ve ever seen or heard [of] in the history of the K-pop industry,” said Cho, president of DFSB Kollective, a music artist and label services agency.

He said the deals had the potential to put HYBE in the same league as the “big three” major record labels: Sony (SNE), Universal and Warner Music.

“HYBE, in their post-BTS stage, have really stunned and surprised fans and financial analysts by really smart, really savvy huge deals,” he added.

In 2019, BTS accounted for as much as 90% of revenue at its management company, then known as Big Hit Entertainment. That left analysts concerned that the firm, later renamed to HYBE, was overreliant on the band.

Since then, however, HYBE has expanded its roster.

In recent years, its slate has grown to include other global celebrities, including Justin Bieber, Ariana Grande and Demi Lovato, who are represented by a team under HYBE’s US subsidiary.

The South Korean firm has also has a tie-up with Big Machine Label Group, an affiliate that oversees some of the top artists in country music, such as Sheryl Crowe, Rascal Flatts and Tim McGraw.

“HYBE is no longer a K-pop juggernaut. The K has now become silent,” said Cho. “They’ve become a pop music juggernaut.”

https://edition.cnn.com
By Yoonjung Seo & Michelle Toh [CNN]

Featured Commentator : Bernie Cho [DFSB Kollective]