1 The Global Phenomenon of K-Pop Culture: The Case of Music

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The Global Phenomenon of K-Pop Culture:
The Case of Music Industry in Korea
Abdul Malik Badeges
Postgraduate Student
Department of Shariah and Economy
Academy of Islamic Studies
University of Malaya
Abstract
Korean pop culture known as K-pop has been a
global phenomenon as popular culture is viewed as one of
interesting social phenomena. K-pop boy and girl bands that
have been produced by The Big Three entertainment
companies such as SM Entertainment, YG Entertainment
and JYP Entertainment have been creating several trends in
Eastern and Southern Asia, and even Europe and the US as
well. These three major entertainment institutions have
enabled K-pop artists to dominate the music industry in
South Korea. This research attempts to discover K-pop as the
global phenomenon in the case of the music industry by
implementing the following objectives such as the
identification of the main characters of K-pop culture, the
recognition of the influences occurred by the K-pop culture
around the world, and the measurement of the sales and
marketing of K-pop in the music industry.
Key words: K-pop, SM Entertainment, YG Entertainment, JYP
Entertainment.
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I.
Introduction
In the last few years Korean pop music has been a phenomenon. It is
known as Korean wave. The recent news of Korean boy and girl
bands making headlines in Eastern and Southern Asia, Europe and
the US is sending new hopes and energy through the K-Pop (short
for Korean Pop) industry following the surge of pride when the
Korean Wave first hit Japan and China in the late 1990s and early
2000s.i
Pop culture is one of interesting social phenomena. Pop culture has
appeared around us and something influencing parts of our life. We
can see many people like and sometime addicted with icon of pop
culture. Pop culture could not separate with the globalization
especially in economic globalization. The flood of product come
from the industrial countries, does not only bring the functional
aspect of the product but also the culture inside. So, this is not only
about the product itself but also the culture which comes behind, or
even come in one package with the product. On the other hand we
can see that pop culture is a kind of culture that popularized and
supported by globalization. The globalization itself is also supported
by technology of information and mass media.ii
The spread of Korean music and the increasing popularity of its
singers are mainly due to the three major entertainment companies
that dominate the K-Pop market: SM Entertainment (SM), YG
Entertainment (YG) and JYP Entertainment (JYPE). SM is the oldest
and largest entertainment company in the Korean music scene. It
gave birth to the first generation of K-Pop boy and girl groups,
including H.O.T, Shinhwa and S.E.S. It now produces the more
recent teenage idols, TVXQ, Super Junior, SHINee and Girls’
Generation. YG is known for its hip-hop and electronic sounds that
are well represented by its current acts Big Bang and 2NE1. JYPE
also has a line-up of idol groups under its name: Wonder Girls, 2AM,
2PM and Miss A. As K-Pop’s influence and popularity continue to
spread, the three entertainment companies are keener trying to keep
up with the demand and expectations of K-Pop audiences around the
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world. The three K-Pop powerhouses are incorporating experienced
foreign — more precisely, Western — talent for both music and
choreography in order to make K-Pop more appealing abroad. But a
look at the major girl groups of the three labels — SM’ s Girls’
Generation, YG’s 2NE1 and JYPE’s Wonder Girls — raises an
important question: is the ―Korean‖ element in K-Pop being
undermined by its global goals?iii
II.
Conceptual Frameworks
Past Studies
The evolution of cultural policy has enabled South Korea to
rediscover its cultural tradition and build a cultural identity against
the cultural globalization. However, the decision to end the
regulation on foreign cultural products marked its step in joining the
cultural globalization. With the help of the government in promoting
the competitiveness of the domestic cultural industries, Korean
culture, in particular the popular culture has succeeded to emerge. It
is now one of the most influential in the world and gain popularity.
Referred as the Korean Wave, this phenomenon was born thanks to
the cultural policy through many years. Recognized as a source of
national wealth and as a cultural identity, the government plays a
crucial role in supporting the Korean Wave in a global scale. For
example, it has opened numerous Korean Cultural Center in different
countries, the newest being the one located in Mexico. Meanwhile,
the entertainment industry has especially a strong will to reach new
markets of the world after conquering the Asian continent.iv
History
In 20 years ago, Western pop culture has been dominated, but in the
end of 1990s and 2000s, Asian pop cultures are also playing
significant influences for many people in the world. Kpop concerts
held around the world see their tickets snapped up within a short 60
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minutes upon release to the public. In some cases for most popular
boy bands such as Super Junior and
Big Bang, 12,000 concert
tickets can sell out within 15 minutes.
Phenomenon
A Korean veteran singer named Psy released a megahit Gangnam
Style in July 2012 which went viral worldwide. The song currently
has almost one and half billion views on YouTube, an incredibly
amazing feat. It has even broken the Guinness World Record for
being the most liked video on YouTube to date – all this achieved
within a short 3 months. The song has made its way to households
worldwide, topping music charts in Asia, Mexico, Europe and
America. It recently ranked first on the UK Charts just after 6 weeks,
making Psy the first ever South Korean musician to top the chart.
Recently, Psy even appeared on the cover of Billboard magazine,
cementing his position in the global music scene as a force not to be
trifled with. Even though Psy does not possess the typical Korean
boyband idol good looks, the success of his music has helped to
bring Korean pop to the next level, making it a global phenomenon
now. Korean artists are also compromised by the focus on big
business. In 2010, while the Korean entertainment industry grossed
more than US $60 million just for K-pop, the artists saw little of that
money because they are locked into the contract and long exclusive
deals.v
Definition
Culture is an abstract and wide term that is why numerous categories
of culture exist including ethnic culture, street culture, folk culture,
popular culture, national culture etc. Just like the word culture,
popular culture can be defined in various ways as well. However, to
understand the general sense of it, we have to refer to the second and
third definitions of the word culture from William, and combine both
meanings. ―The second meaning – culture as a particular way of life
– would allow us to speak of such practices as the seaside holiday,
the celebration of Christmas, and youth subcultures‖. ―These are
referred as lived cultures or practices. The third meaning – culture as
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signifying practices – could allow us to speak of soap opera, pop
music, and comics‖. ―These are usually referred to as texts―.
Therefore, popular culture is the consumption of practices and texts
that reflect the aspects of a culture.vi
K-pop refers to Korean pop music, which in recent years, has taken
Asia and the world by storm. Some American magazines have even
described
Korean pop as a ―pop culture tsunami flowing from
South Korea to the United States to the rest of the world‖. Raymond
Williams designates culture as ―one of the two or three most
complicated words in the English language‖ for being used ―in
several distinct intellectual disciplines and in several distinct and
incompatible systems of thought.‖vii
Theories
In social anthropology, Hofstede defines culture as ―the collective
programming of the mind which distinguishes the members of one
human group from another.‖ The ―programming of the mind‖ is a
pattern of feelings, thinking and behaviors, and in that sense, it has a
system of values and norms. Hofstede points out three levels of
mental programming.viii The individual level corresponds to the
individual personality, which is inherited and learned, while the
universal level corresponds to the human nature (genetic
information) that is inherited. The collective level (right in the
middle) applies to culture which is specific to a group and learned,
but not inherited. It is shared with people from a same social
environment, and then is transmitted from generation to generation.ix
III.
Research Objectives
This research attempts to discover K-pop as the global phenomenon
in the case of the music industry by implementing the following
objectives below:
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1. To identify the main characters of K-pop culture
2. To recognize the influences occurred by the K-pop culture
around the world
3. To measure the sales and marketing of K-pop in the music
industry
IV.
Methodology
Methods of data collection
This study will utilize both the secondary and primary data. Secondary
data refer to available data, could be published or unpublished material.
Primary data will be dealt with the relevant authorities of the relevant
area. Data will be collected through interview.
The population in this study consists of WAHS and KOCCA. The
World Association for Hallyu Studies (WAHS) is a non-profit
membership association dedicated to advancing Hallyu Studies as a
multidisciplinary body of knowledge and profession serving the public
good. Korea Creative Content Agency which focuses on the content that
has been produces in the world of broadcasting in South Korea.
The sampling technique used in this study is recording the interview;
this technique was employed to select the sources from the targeted
enterprises. Stratification was done based on the amount of information
from staff in a managerial level from each company.
Methods of data analysis
This research is using qualitative method. Primary data which will be
interviews with various sources will be analysed and delivered in
finding, discussion and conclusions.
V.
Public Benefit
This study delivers to enhance the literature on perceived barriers to
K-pop culture in the music industry. Moreover, the result of this
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study will also be extending the knowledge of higher education
institutions to develop the research in the field of culture especially
K-pop culture.
A better curriculum is expected in this study. The students and
scholars may also increase their point of view in helping the music
industry in their policy assistance to K-pop culture and inventing
some new programs that can favour K-pop culture more popular,
specifically the biggest three institutions in the music industry such
as SM Entertainment (SM), YG Entertainment (YG) and JYP
Entertainment (JYPE).
VI.
Outline Of Topic
Abstract
1. Introduction
2. Conceptual framework
a. Past Studies
b. History
c. Phenomenon
d. Definition
e. Theories
3. Research Objectives
4. Methodology
a. Methods of data collection
b. Methods of data analysis
5. Public Benefit
6. Outline of Topic
7. Discussion
a. Main Characters of K-pop
b. K-pop Influences Around The World
c. The sales and Marketing of The Big Three
8. Conclusions and Recommendations
9. References
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VII.
Discussion
Main Characters of K-pop
The first Korean wave began with the export of Korean
television serials and films in the midst 1990s to Asian countries
such as China, Hong Kong and Taiwan. It peaked in the early 2000s
in Japan with its expansion. Unfortunately, after 2006 as the rate of
increase of broadcasting exports began to slow in Chinese speaking
Asian countries, it declined. There are two main reasons behind the
decline seem to be twofold: one was discontent on the part of the
importing countries with the influx of Korean broadcasting programs
and a resulting state intervention into the import of Korean
broadcasting programs through establishing import quotas. The other
was shrinking interest on the part of the program importers in Korean
programs, triggered by rising prices and their customers’ fatigue with
repetitive plots and characters.x
The decline of Korean wave was speculated. It actually did
not fall. From 2009, another Korean Wave surfaced when young pop
groups first became conspicuous on global forums on social
networks Youtube, Facebook and the U.S. Billboard charts. Even
prior, K-pop performers such as BoA, Rain and Wonder Girls have
been attempting sporadic to penetrate foreign markets. By 2010, a
number of K-pop groups such as Girl’s Generation, Big Bang, and
TVXQ had made inroads into the Billboard and Oricon charts, and
most significantly into YouTube. In 2011, a series of K-pop concerts
attracted hundreds thousands of loyal fans in global cultural centers
such as New York, Paris, Tokyo, and Bangkok. In addition, Korean
Wave fan clubs can be seen to include several million members
drawn from all over the world.xi Outside K-pop in the original
Korean Wave recipient countries, Korean television serials continue
to be broadcasted and it is also start again advancing into new
territories such as the Middle East, Central Asia, Latin America, and
Africa. France is one of the most recent participants where more than
20 internet sites provide K-pop and K-television serials accompanied
with translation into 15 to 17 languages.xii
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Korean pop culture or known as K-pop has been defined in
many different point of views including both theoretical and applied
perspectives. It refers to several meanings that show the existence of
cultural heterogeneity. K-pop is also called ―Hallyu‖ which literally
means ―Korean Wave‖. It is a new cultural consumption pattern in
Asia (specifically, Hong Kong, Taiwan, China, Indonesia, Thailand,
Vietnam, the Philippines, Central Asia, and Japan), where mostly
young and middle-aged women prefer all genres of Hallyu products
imported from Korea (popular music, films, TV dramas, on-stage
musicals, theatre dramas, and TV show programs) over Western or
Hollywood counterparts.xiii However, Korean pop culture has also
been explained by the expert researchers from private Korean
institutions and also the Korean government side as shown below:
K-pop culture is a sub-culture because it is neither a
universal culture nor a mainstream. The term keeps
changing from one country to another, from one region to
another. There are four areas to focus on. The areas are the
production side, the customer side, the performer side and
the distribution side. If we focus on the performer side, they
are young multi-cultural performers. That is what makes
them different from others. (Prof. Ingyu)xiv
It is believed that K-pop culture is a sub-culture because if a
person goes to Japan, America, Europe, or Southeast Asian
countries, K-pop is not a mainstream of those countries so it is still a
sub-culture. The term keeps changing from time to time. As an
example, Korean pop sub-culture cannot be generalized. In Korea,
K-pop is very popular but there are some singers that are not. They
are not popular in Korea but they are phenomenally successful in
other countries. KARA is incredibly powerful and very famous in
Japan but they are sort of the forgotten K-pop girl bands in Korea. Kpop is a popular music. They always come and go in five months
period, even sometimes less than five months period. It is just a short
period so it is very difficult to characterize it in one word. If it is said
that there are main characteristics of K-pop sub-culture, it could be
several forms. It depends on what it is going to focus or highlight.
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There are four areas that can be focused on. The first one is about
who produces K-pop which is the production side and then the
customer side who enjoys the K-pop products. The distribution side
who distributes K-pop to the world and the last one is the
performers’ side that has always been the idols. Every area has its
own characteristics. If we focus on the performers’ side, it can be
concluded that they are very young and there is no performers whose
age is 40 or 50 years old. It tells that K-pop period is so short. For
instance the early K-pop star JYP, he is no longer performer but
Manager in the music industry. Longevity is short. BoA is very
popular in Japan but now she is almost retired because K-pop
performers are those who are so young. They are also multi-cultural
performers such as American-Korean, Japan-Korean, EuropeanKorean. Actually they prefer multi-cultural people. The language
used is very important because of the market. Young people must go
to the training for 6 or even 10 years which is long-period training.
The training includes body shaping to make their body shape and
looks sexy. It can be compared between Korean singers with nonKorean singers such as Chinese or Japan singers. Korean singers are
taller, more attractive, their height at least 1 inch taller if we compare
Girls Generation to other artists from China and Japan. It is a
physical side.
K-pop Influences Around The World
What makes K-pop different from other cultures is one of the
interesting topics to be discussed. If we compare to other cultures
like Japanese pop culture, J-pop is not a sub-culture but it is a
mainstream culture in Japan. J-pop in America is a sub-culture but
not the mainstream culture. There are many differences about these
both cultures. J-pop is not meant to be exported. It produces J-pop
performers who are unintended to go overseas. They are prepared to
perform in their home country which is predominantly domestic.
However, K-pop is meant to be exposed. This is one of the main
characteristics. J-pop is not international but K-pop is global. K-pop
composers are from overseas. Many of them come from Europe and
America. Singers are Korean-American, Korean-Japanese, Korean10
Chinese and even Thai people. It could be more international. K-pop
distributors are all international. This is another perspective from Kpop. J-pop audiences are predominantly Japanese, young Japanese
and middle-age Japanese but K-pop has international audiences.
The presence of Hallyu phenomenon provides more choices
to international cultural customers who have always been used to
Chinese Kung-Fu movies, Hollywood action thrillers, or the French
film noir and also along with the Bollywood success. It may augur
the increasing diversification of the global entertainment industry.
The superiority of the free market principle might also be affirmed. It
touts an equal path to the international market for all culture-based
models that bear any commercial value.xv
Using these factors, we can hypothesize Hollywood as a
political economic structure that strives to perpetuate its domination
in the global culture market through its center power with strong
white, male, and middle- and upper-middle class values, all of which
engender opportunity and incentive structures for producers and
distributors who want to reinforce such values (e.g. spirit of
capitalism, political liberalism, mass consumerism, male chauvinism,
sexism, white supremacy, universalism, Eurocentrism, metaphors of
sex and violence, etc., etc.). In a similar vein, Hallyu can be put
forward as a semi-periph-ery power with strong Korean (or Asian),
female, and middle- and lower-middle class values, all of which
provide opportunities and incentives to producers and distributors
who want to reinforce such values among young or middle-aged
women (e.g. Confu-cianism, strong work ethic, family orientation,
the world filled with harsh class exploitation, submissive and
feminine images of women, etc., etc.).xvi
Psy is dramatically loved by most of American men in their
30s, 40s, and 50s. American men, who do not like the person
with lifestyle, do not like their body shape; do not like their
general judge. (Prof Ingyu)
Psy that has been a Youtube sensation is an exceptional
singer who is difficult to be categorized with second generation of
Korean Hallyu. He is neither about physics nor about age. It is more
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to music and dance. Some people like it because of the music and
dance. He is the third generation of Korean wave who is also about
the universalization of music.
K-pop culture becomes a global phenomenon around the
world because of the uniqueness. K-pop dance music is
performed by young girl and boy bands. There is no kind of
music just with a group dancing which is interesting in the
world. A lot of girl and boy bands but they do not dance, just
like Spice Girls and Backstreet Boys. It is kind of uniqueness.
(Min Kim)xvii
From the government side, K-pop has been agreed as a
global phenomenon in the world because it has its own character. Kpop dance music is performed by young girl and boy bands that do
the singing and dancing at the same time. K-pop has uniqueness
among the rest. Many of performers in the music industry around
world just sing or dance. Even though there are certain singers who
do the dance, but they are not in a group. In other words, K-pop
performers have uniqueness that nobody has before.
K-pop is not popular without Youtube. It is more to business
or more to dissemination. Before youtube, people did not see
K-pop in the world and only after Youtube people know Kpop. Meaning to say, it is only single relationship between
K-pop and Youtube. There is no other relationship. (Prof
Ingyu)
Youtube is a social network that can be accessed anywhere
with internet connection. K-pop can be watched on youtube but
youtube also has commercials. Watching youtube is free of charge
but there are also commercial advertisements. With youtube, people
from all over the world can enjoy watching movies and music
videos. This is how K-pop distributes their products. People who live
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in Japan know about K-pop and foreigners who live in Japan can
recognize K-pop because of their Japanese friends and they tell their
friends in their home country. This is why a lot of people know and
even like K-pop.
The influence of K-pop only happens in Southeast Asia and
also China. It changed their local music and also the point of
view about the beauty look of a person especially for girls.
(Prof Ingyu)
Generally, there is no effect about how people dress up and
how people behave. It changed their local music culture. If we look
at the music before K-pop and after K-pop in Indonesia, there is a
difference. Previously, the music was like heavily males rock bands
playing. Nowadays, it is more like K-pop boyband like what happens
in Indonesia and also in Thailand because of an icon 2PM. Thai
music has changed more like K-pop but if we go to Europe and
Japan. Japan is quite similar to Chinese but not in terms of dressing
up. The only thing that has been changed is cosmetics. All people
believe that Korea girls have beautiful face and skin, the point of
view about being beauty with cosmetics surgery, cosmetics products,
and make up products. All this products are becoming more like
style. Many Chinese girls visit Korea to do the plastic surgery. Many
Europeans even now make creams and all beauty products. Thus, this
is the influences, not the food, not the dress, and not the way of life
but more to cosmetics and the concept of look.
It is only young people who love K-pop. When they get old,
they will hate K-pop. They will become anti-Hallyu when
they grow up. Some of them protest. That is an individual
decision so it is very difficult to deal with it. (Prof Ingyu)
Some people who do not like K-pop are those who are
already old. They used to love K-pop when they were young. Once
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they get old, they will tell their children not to listen to K-pop music
because K-pop destroys children and teenagers. It is a waste of time.
The children and teenagers should study hard not to listen to K-pop
especially when it becomes a habit. It will hurt them. There must be
a lot of anti-Hallyu members rather than the Hallyu fans. In general,
if people in the world accept K-pop, they should air it on the radio,
air it on TV but they never do. In Europe, America, New Zealand,
wherever we go, there is no radio station that airs Korean songs.
There is no television station that airs Korean music. They
just air their music even though it has been a sensation. Korean Pop
has never been put on their mainstream show. It is not a good
business. The only time they showed Korean music was Psy with
Gangnam Style on the American European television that is only
because the management who is very powerful is the music industry
who can pull the string in the US broadcasting industry.
Before Psy, 22 billion the majority only in Asia but after Psy,
it is not only in Asia but also western and even the demand
from western world is even higher than from Asia, It is going
to South America. However, There are some people who
hate K-pop and it is personal, not a country. It is also a
culture. (Min Kim)
Psy is one of the youtube sensations. Until now, his music
video on youtube already hits 1.8 billion views which gain the
biggest viewers in the history of youtube. Psy also studied in
America and he is very much influenced by American culture but he
is very much influenced by Korean culture too. He is very Korean.
Regarding the Muslim countries, they like K-pop so much for
example Indonesia, Malaysia, Dubai, Egypt, Iran, Persia and even if
we go to Palestine. All these people love K-pop. It is only young
girls. It becomes dangerous sub-culture to mirror Islamic Muslim
culture. It is not European culture. In Egypt, they protest. In Iran,
they think that this is not right. They banned America. Iran
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completely banned America so they listen to Korean music and
watch Korean dramas.
From the government view, haters can be one side. K-pop is
kind of culture. Culture is basically exchange not a trade. In
this time, K-pop goes to Indonesia but Indonesia is not
coming to Korea. It is not an exchange so it is one-sided
explode which results haters. (Min Kim)
K-pop can be a great learning experience for example
Chinese and other Southeast Asia. There must be a co-relation
between why their liking and their nationality. It is very
contradictory element between the two why people like it. For
example, Chinese people cannot openly like Japanese music because
it is against their nationality. Same thing, Indonesia cannot openly
like European music or Malaysian music for the same thing if it is
anti-Islamic culture. So it is a conflict. As long as there is no such
conflict if boarding culture to Asian or Southeast Asian culture such
a sort of great learning. The South Korean pop culture is a model
product. They can immolate quickly. It is a process so for example
K-pop and Japanese cars in the United States. In this case, Japan is
such a great learning for Koreans. If Japan can do such thing, we can
also do that as quickly as possible. We can produce our own cars
ourselves in the United States. It becomes the interest from one
Japanese product. To Chinese and to Southeast Asian, when they see
Korean music coming in, it is not only entertainment but it is also a
source of learning for themselves which is different from European
music that cannot be the source of learning directly because it is too
far not only in terms of politics but also in terms of geography. There
are internal music in east and west. Music is west. It is not Korean at
all. It is western so it is pretty much universal so what is the different
is the lyric and melody.
The melody is different. Melody is a very important element
in music but if we look at Western music now. It is not into melody
aspect but it is more to beats. That does not really match with Asian
mentality. Asians are more into cherishing good melody so K-pop
those young people is more melodic orientation that is why westerns
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publish. They call Korean manufacturing process so when they go to
overseas when they go to Europe. They get an American music and
they get a European, they cannot sell that kind of music directly
because they know they cannot sell it that is why they change a little
bit. The changing is adding melodic part and the lyric so the melodic
and lyric are very much valued and use English words and simple
Korean words. It is good if it is melodic because it is good to hear
and ears love it. They want to listen to it over and over again and also
create group dance called synchronization from Asian.
The sales and Marketing of The Big Three
The number one of K-pop products is in Japan. The number
two sales is probably Korea followed by China. K-pop is not
for Koreans, K-pop is initially for Japanese. (Prof. Ingyu)
Japan is the number one country selling K-pop products. All
Korean pop culture products are sold in Japan. This happened since
Japanese companies were selling Korean music. It brought K-pop
was produced in Korea and made a lot of money. It is the Japanese
that makes a lot of money. The number two sales is probably Korea
followed by China. K-pop is not for Koreans, K-pop is at the
beginning for Japanese. KARA and BoA are both Korean but they
are very popular in Japan. BoA is known as Japanese to many people
and Chine could be the third country in Korean popular culture
product sales.
The biggest thing comes first is from Youtube. The big three
companies such as SM, YG and JYP make a lot of money
from Youtube. Performers take the least shares. (Prof.
Ingyu)
Three biggest music entertainment industries such as SM
Entertainment, YP Entertainment, and JYP Entertainment play an
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important role in producing Korean pop culture artists. S.M.
Entertainment is an independent Korean record label, talent agency,
producer, and publisher of pop music, founded by Lee Soo-man in
South Korea. Initially, "SM" was an abbreviation of the agency
founder's name, but now stands for "Success Museum." Its current
CEO is Kim Young-min. The label is one of the "big three" record
companies of Korea along with YG Entertainment and JYP
Entertainment because of strong market share and international
operations. SM is credited for starting and leading the Hallyu Wave
throughout Asia and internationally. Once the home to the original
Korean Idol groups like H.O.T., S.E.S., and Shinhwa, its current
roster of recording artists include Kangta, BoA, TVXQ, TRAX, The
Grace, Super Junior, Zhang Liyin, Girls' Generation, J-Min, Shinee,
f(x), EXO andHenry, all of whom enjoy great success both
domestically and internationally. It is also home to actors like Go
Ara, Kim Min-jong, Kim Ha-neul, Lee Yeon-hee and Kim Ian
among many other. SM Entertainment also co-publishes Avex
Traxreleases for Japanese artists such as Ayumi Hamasaki, Namie
Amuro, and Koda Kumi, as well as Johnny's Entertainment acts like
Arashi and KAT-TUN. In 2012, the company's market capitalization
rose to ₩1.38 trillion (US$1.24 billion), reaching the status of a
mega-corporation.
YG Entertainment is a record label and talent agency
founded by Yang Hyun-suk based inSeoul, South Korea. It produces
and markets music recording/publishing, record manufacturing/sales,
artist management, concert production, and new artist
discovering/training. YG is an abbreviation for "Yang Goon", a
nickname given to the Executive Director Yang Hyun-suk. Once the
home of hip-hop groups Jinusean and 1TYM, its current roster of
recording artists are known to be some of the biggest K-pop acts
internationally. Big Bang, 2NE1, and PSY have proved to be the
front runners. Today, YG Entertainment is known as one of the "big
three" record companies in South Korea, along with S.M.
Entertainment and JYP Entertainment, for their large market share.
Official contents by YG Entertainment and its artists have
cumulatively garnered more than 4 billion views and are subscribed
by more than 10 million users on YouTube, making them the most
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viewed and most subscribed artists and entertainment agency in
Asia-Pacific. YG Entertainment's records are distributed by KMP
Holdings in Korea, WMG in Taiwan, and Japan operations are
managed by YGEX, a collaboration label between AVEX and YG
Entertainment. The company officially became a publicly traded
company on November 23, 2011. In 2012, YG Entertainment's share
prices saw a year-over-year increase of more than 60% due to the
increase in publicity following the achievements of multiple artists
on the label. Another one is JYP Entertainment. It is a Korean record
label, founded in South Korea in 1997 by Park Jin Young. The label
is one of the "big three" record companies in Korea along with YG
Entertainment and S. M. Entertainment that have strong market share
and international operations. Once home to artists like Rain, Park Ji
Yoon, andg.o.d, the label's current roster of recording artists include
Wonder Girls, JOO, 2AM, 2PM, miss A, JJ Project, Baek Ah
Yeon,15& and Lee Sunmi.
The marketing tools are Youtube and other social networks.
Most of Korean pop fans watch Youtube and the second is
social networks. (Min Kim)
The Korean Wave has especially experienced a significant
change with the development of digital technologies and social
media, such as YouTube, social network sites (SNSs), and
smartphones in the 21st century. These digital technologies, as new
driving engines of the Korean Wave, have initiated and supported the
popularity of local culture inmany countries. The growth of social
media has uniquely influenced Korean creative industries, because a
few media outlets, such as YouTube and SNSs, have become
significant parts of the new Korean Wave (Hallyu2.0). K-Pop has
become the most distinct cultural genre in the Hallyu2.0 era. While
K-Pop was part of the early growth in the Korean Wave, Korea did
not make impressive popularity in the global music markets until
recent years. However, K-Pop has been a driver of Hallyu2.0 as
Korea exported $80.9 million worth of music in 2010, a 159%
18
increase from 2009. Furthermore, in 2011, the music industry
exported $177 million, a 112% increase from the previous year.
Online gaming and K-Pop have been the two most significant
cultural sectors in the Korean creative industries.xviii
The sale of K-pop products in 2011 seems great with 35
billion us dollars annual profit only in Korea and 8th position
in the world, not in a small market. From 2010 and 2011, it
increased 30%. Psy has a small influence in domestic
market. Export 2 billion dollars to overseas market and
155% increase after Psy. (Min Kim)
The latest sales of SM (041510: KOSDAQ) , YG (122870:
KOSDAQ) and JYP (035900: KOSDAQ) Entertainment industries
have been published by Korean electronic stock exchange,
KOSDAQ, as the 14th semi-annual financial report to the public on
August 29, 2013. All the earnings of all these big three agencies from
January 1, 2013 to June 30, 2013 have been publicly revealed by
Korea’s Financial Supervisory which is the first half of 2013 sales.
Approximately $ 155,899,608.00 USD has been the accumulated
earnings of all three companies in the first half of the year that is also
one of the highest records in the music industry in Korea comparing
to last year total revenue for the first half of 2012 for SM, YG, and
JYP was 114.1 billion KRW or $ 102,815,053.60 USD. Overall, Kpop seems to be continuously increasing business. Here is the first
half year earning as the latest sales of the big three companies in
entertainment industry in South Korea:xix
19
Table: 7.0 Total Half Year Revenue of SM, YG, and JYP
Entertainments in 2013
Music
Industries
Latest Earnings
Quarter
Half
SM Entertainment
$ 50,915,624.34 USD
$ 95,639,015.90 USD
YG Entertainment
$ 27,367,859.99 USD
$ 54,036,032.31 USD
JYP Entertainment
$ 2,537,382.04 USD
$ 5,048,911.85 USD
Source: allkpop
As the table shown above, it can be concluded that the
highest earning has been reached by SM Entertainment and the
second highest goes to YG Entertainment whereas JYP
Entertainment is the last. SM Entertainment has been at the top of its
record in the music industry in music industry in South Korea at
present time. Since SM has been publicly listed company on the
KOSDAQ, the company seems to be able to reach a goal with these
revenue numbers. Previously, the sales of these big three companies
in K-pop music industry have gained ups and downs as well.
20
Figure 7.0 Total Half Year Revenue of SM, YG, and JYP
Entertainments in 2013
120
100
80
60
Quarter
40
Half
20
0
SM
YG
JYP
Entertainment Entertainment Entertainment
Source: AllK-Pop
The figure shown above reveals the total half year revenue of
SM, YG, and JYP Entertainments in 2013. It can be seen that in
terms of the sales in quarter and half of 2013, the highest sale of each
session has been gained by SM Entertainment with $ 50.9 million
USD for quarter and $ 95.6 million USD for the half year of 2013.
YG Entertainment was at the second top with $ 27.3 million USD
earning for the quarter season and $ 54.0 million USD for the half
year of 2013. JYP Entertainment was the least company which
reached the minimum earning among these three companies. The
quarter sale was $ 2.5 million USD and $ 5.0 million USD for the
half year of 2013.
21
Table 7.1 Annual Earnings of SMxx, YGxxi, and JYPxxii in
2009
Currency in
Millions of South
Korean Wons
Revenues
Total Revenues
Cost of Goods Sold
Selling General and
Admin Expenses, Total
JYP
YG
SM
9.1
9.1
10.7
35.7
35.7
19.8
61.8
61.8
41.8
2.1
9.8
41.8
The table above shows the annual earnings of SM, YG and
JYP in 2009. It is clearly seen that SM Entertainment is at the top
position of revenue in 2009.
SM Entertainment earned 61.8 million wons for the total
revenues in 2009 while YG gained 35.7 million wons and JYP
obtained 9.1 million wons. The cost of goods sold of SM
entertainment was 41.8 million wons as same as its total of selling
general and admin expenses. The cost of goods sold of YG
Entertainment was 19.8 million wons and 9.8 million wons for its
total of selling general and admin expenses. The cost of goods sold
of JYP Entertainment was 10.7 million wons while its total of selling
general and admin expenses was 2.1 million wons.
It can be concluded that SM Entertainment is at the top level
of annual earnings in 2009 comparing to YG Entertainment and JYP
Entertainment. YG Entertainment goes to number two while JYP
comes to the third position.
22
Table 7.2 Total Revenue Annual Earnings of SM, YG, and
JYP in 2010xxiii
Currency in
Millions of South Korean
Wons
Revenues
Total Revenues
Cost of Goods Sold
Selling General and
Admin Expenses, Total
JYP
YG
SM
10.2
10.2
12.8
57.5
57.5
33.1
86.4
86.4
48.8
3.1
11.5
12.4
The table above describes the annual earnings of SM, YG
and JYP in 2010. It is clearly viewed that SM Entertainment is at the
top position of revenue in 2010.
SM Entertainment gained 86.4 million wons for the total
revenues in 2010 while YG earned 57.5 million wons and JYP
obtained 10.2 million wons. The cost of goods sold of SM
entertainment was 48.8 million wons as same as its total of selling
general and admin expenses. The cost of goods sold of YG
Entertainment was 33.1 million wons and 11.5 million wons for its
total of selling general and admin expenses. The cost of goods sold
of JYP Entertainment was 12.8 million wons while its total of selling
general and admin expenses was 3.1 million wons.
In conclusion, it can be seen that SM Entertainment is at the
top level of annual earnings in 2010 comparing to YG Entertainment
and JYP Entertainment. YG Entertainment is second while JYP is at
the third position.
23
Table 7.3 Total Revenue of SM, YG, JYP in 2011xxiv
Currency in
Millions of South Korean
Wons
Revenues
Total Revenues
Cost of Goods Sold
Selling General and
Admin Expenses, Total
JYP
YG
SM
19.8
19.8
16.3
78.1
78.1
47.0
109.9
109.9
73.1
6.4
13.4
16.4
The table above shows the annual earnings of SM, YG and
JYP in 2011. It is clearly seen that SM Entertainment is at the top
position of revenue in 2011.
SM Entertainment earned 109.9 million wons for the total
revenues in 2011 while YG gained 78.1 million wons and JYP
obtained 19.8 million wons. The cost of goods sold of SM
entertainment was 73.1 million wons as same as its total of selling
general and admin expenses. The cost of goods sold of YG
Entertainment was 47.0 million wons and 13.4 million wons for its
total of selling general and admin expenses. The cost of goods sold
of JYP Entertainment was 16.3 million wons while its total of selling
general and admin expenses was 6.4 million wons.
It can be concluded that SM Entertainment is at the top level
of annual earnings in 2011 comparing to YG Entertainment and JYP
Entertainment. YG Entertainment goes to number two while JYP
comes to the third position.
24
Table 7.4 Total Revenue of SM, YG, JYP in 2012xxv
Currency in
Millions of South Korean
Wons
JYP
YG
SM
Revenues
Total Revenues
Cost of Goods Sold
Selling General and Admin
Expenses, Total
15.1
15.1
11.6
106.6
106.6
64.5
168.8
168.8
99.9
9.4
20.6
20.8
The table above describes the annual earnings of SM, YG
and JYP in 2012. It is clearly viewed that SM Entertainment is at the
top position of revenue in 2012.
SM Entertainment gained 168.8 million wons for the total
revenues in 2012 while YG earned 106.6 million wons and JYP
obtained 15.1 million wons. The cost of goods sold of SM
entertainment was 99.9 million wons as same as its total of selling
general and admin expenses. The cost of goods sold of YG
Entertainment was 64.5 million wons and 20.6 million wons for its
total of selling general and admin expenses. The cost of goods sold
of JYP Entertainment was 11.6 million wons while its total of selling
general and admin expenses was 9.4 million wons.
In conclusion, it can be seen that SM Entertainment is at the
top level of annual earnings in 2012 comparing to YG Entertainment
and JYP Entertainment. YG Entertainment is second while JYP is at
the third position.
25
Figure 7.1 The Total Revenue of SM, YG, JYP Entertainments
from 2009 to 2012
The figure illustrates the revenues of SM, YG and JYP
Entertainments between 2009 and 2012 in South Korea. It can be
seen that SM is the top earnings company comparing to others.
As shown above, SM Entertainment seemed to have the
highest earning rather than YG and JYP Entertainments. The total
revenue of SM Entertainment in 2009 was 61.8 million wons. It was
increasingly going up in 2010 (86.4 million wons), 2011 (109.9
26
million wons) and 2012 (168.8 million wons). In the second position,
YG gained 35.7 million wons in 2009, 57.5 million wons in 2010,
78.1 million wons in 2011 and 106.6 million wons in 2012. In the
last position, JYP earned 9.1 million wons in 2009, 10.2 million
wons in 2010, 19.8 million wons in 2011 and 15.1 million wons in
2012.
To sum up, it can be concluded that SM is at the top position
of total revenue in the music industry in South Korea, especially in
producing K-pop products. All of the companies such as SM
Entertainment, YG Entertainment and JYP Entertainment have
gradually climbed up from year to year. It is only JYP who falls few
points in 2012 but overall, all of these institutions have gained the
top earnings companies in South Korea especially in producing Kpop products.
The Future of K-pop
K-pop performances have been broadcasted by the social media tool
particularly youtube which has enabled K-pop performers to still be
seemingly able to stand up in Asia. Expanding music will be much
easier with the presence of youtube. J-pop as the only rival of K-pop
which has a number of fans based in Southeast Asia is much
considered lower than K-pop popularity.
In the future, in terms of business, it will be more booming
because that is the only one thing. J-pop is not banned. It is
not sold on Youtube. So in Asian countries, K-pop is the only
one who is bright. (Prof. Ingyu)
Referring to the music home productions, there are two kinds
of music which stand at the top and also lead the entertainment
industry in Asia. J-pop and k-pop seem to be the ones that can across
the Asian or even European countries. Unfortunately, J-pop does no
longer exist in selling their products whereas K-pop seems the only
one that can make sales.
27
Hopefully K-pop will expand its music because it is believed
that K-pop music is a good music in Korea. Korean Walk
has been one of the biggest festivals in the US market. (Min
Kim)
K-pop has already expanded its music to the world.
Everyone who has a gadget with internet connection can enjoy Kpop products such in a video or music format. In Korea, it is also
believed that K-pop is a good music. In the US market, Korea has an
annual event called Korean walk which is one of the biggest festivals
in that country.
28
VIII.
Conclusions and Recommendations
Korean pop culture or K-pop as the global phenomenon has
been known as a sub-culture as it is not the mainstream of countries
such as Japan, America, Europe or even Southeast Asian countries.
Generalizing Korean pop sub-culture results subtle meanings. From
the government side, K-pop has been considered as a global
phenomenon because it has its own character. Its dance music has
been performed by young girl and boy bands that sing and dance at
the same time that becomes the uniqueness among the rest. Youtube
as a social network that can be accessed by people from all over the
world plays an important role in commercializing K-pop and this is
the way how K-pop products have been distributed as the great exitstrategy of marketing in the middle of global music marketization.
Regarding the sales, it can be concluded that the highest earning has
been placed by SM Entertainment and the second highest goes to YG
Entertainment whereas JYP Entertainment is the last. SM
Entertainment has been at the top of its record in the music industry
in music industry in South Korea at present time.
29
IX.
References
Cho, H. Hae, J., Hwang S. M.,, Iwabuchi, K.I., Lee, D.H., and Kim,
H.M. (2003). Hallyu wa Asia ui Daejung Munhwa [Hallyu and Asian
Popular Culture], Seoul: Yonsei University Press.
Chon, T. (2007). Hallyu neun Baram eul Tago Hangul eun Ssangdumacha reul Tago [Hallyu Flying in the Wind, Hangul Riding a
Carriage and Pair], Seoul: Yeyeong.
Effendi, Tonny Dian. (2012). from Proceedings-Human Resource
Development, Education, Morals, Ethics, and Politics-002 4th
International Conference on Humanities and Social Sciences April
21st , 2012 Faculty of Liberal Arts, Prince of Songkla University.
Fu, K and Khun, Liew Kai .(2006). Pop Cultures Bridges Korea and
Singapore: Prevalence of Korean Pop Culture Overseas Provides
Inspiring Example For The City State. The Korean Herald
Hofstede, G. (1984). Culture’s Consequences: International
differences in work -related values, Abridge Edition, SAGE
Publications.
Hwang, D. (2012). Latin America embraces Korean culture,
Korea.net: Gateway to Korea.
Ingyu, O. (2009) ―Hallyu: The Rise of Transnational Cultural
Consumers in China and Japan‖, Korea Observer, The Institute of
Korean Studies 40.3, 425-459.
Jung, S. (2011) ―Oeguk Hallyu Fanclub Hoewon 330 manmyeong
Dalhae,‖ [Foreign Korean Wave Fans Reach 3.3 Million], Hankyoreh Shinmun.
30
Kwon, H and Youngsoo, K, (2009). Hallyu Hwaksan eul uihan
Jeollyak gwa Jeongchaek [Strategies for the Expansion of Korean
Wave: Focusing on Broadcasting Programs]. Hangukkontencheu
Jinheungwon.
Marcel, D. (2008). Popular Culture : Introductory Perspectives.
Plymouth, United Kingdom : Rowman & Littlefield Publisher, Inc.
Sooyeon, L (2012). The Structure of the Appeal of Korean Wave
Texts. Korea Observer, The Institute of Korean Studies 43.3. 447469.
Storey J. (2006), Cultural theory and popular culture: an introduction
, Fourth Edition, England, Pearson Education Limited.
Williamson, L. (2011). The dark side of South Korean pop music.
Yang, S, (2011) ―Digital Media ro Peojin K-pop Virus Dolpung‖ [KPop Virus Spreading through Digital Media], Joong-Ang Ilbo.
Yun-Jung, C (2012). The Globalization of K-Pop: Is K-Pop Losing
its Korean-ness? Situations Vol. 5 by Yonsei University.
31
i
Fu, K and Khun, Liew Kai. Pop Cultures Bridges Korea and Singapore:
Prevalence of Korean Pop Culture Overseas Provides Inspiring Example
For The City State. The Korea Herald, March 2008
ii
Effendi, Tonny Dian. (2012) from Proceedings-Human Resource
Development, Education, Morals, Ethics, and Politics-002 4th International
Conference on Humanities and Social Sciences. April 21st , 2012 Faculty of
Liberal Arts, Prince of Songkla University. Cited from Marcel, Danesi.
(2008). Popular Culture : Introductory Perspectives. Plymounth, United
Kingdom : Rowman & Littlefield Publisher, Inc.
iii
Choi, Yun-Jung. The Globalization of K-Pop: Is K-Pop Losing its
Korean-ness? Yonsei University 5 (2012): 69 – 75.
iv
D, Hwang. Latin America embraces Korean culture, Korea.net: Gateway
to Korea.‖ Retrieved from
http://www.korea.net/NewsFocus/Culture/view?articleId=99323
v
L, Williamson. The dark side of South Korean pop music. Retrieved from
http://www.bbc.co.uk/news/world-asia-pacific-13760064
vi
Storey J, Storey. Cultural theory and popular culture: an introduction.
Fourth Edition, England, Pearson Education Limited, 2006
vii
Williams R, Williams, Keywords: A vocabulary of culture and society,
Revised edition, London, Great Britain, Fontana Paperbacks, 1983.
viii
G, Hofstede, Culture’s Consequences: International differences in work related values, Abridge Edition, SAGE Publications, 1984.
ix
Ibid. P. 14-16.
x
Kwon, Hoyoung and Youngsoo Kim, Hallyu Hwaksan eul uihan Jeollyak
gwa Jeongchaek [Strategies for the Expansion of Korean Wave: Focusing
on Broadcasting Programs]. (Hangukkontencheu Jinheungwon, 2009).
Sooyeon Lee. (2012). The Structure of the Appeal of Korean Wave Texts.
Korea Observer, The Institute of Korean Studies 43.3. 447-469.
xi
Jung, Sanyeong, Oeguk Hallyu Fanclub Hoewon 330 manmyeong Dalhae,
[Foreign Korean Wave Fans Reach 3.3 Million], Han-kyoreh Shinmun,
November 2, 2011. Ibid,.
xii
Yang, Sunghee, Digital Media ro Peojin K-pop Virus Dolpung. [K-Pop
Virus Spreading through Digital Media], Joong-Ang Ilbo, May 13, 2011.
Ibid,.
xiii
Cho-Han, Hae-joang, S. M. Hwang, K. I. Iwabuchi, D. H. Lee, and H. M.
Kim. (2003). Hallyu wa Asia ui Daejung Munhwa [Hallyu and Asian
Popular Culture]. Seoul: Yonsei University Press. Ingyu Oh, Hallyu: The
Rise of Transnational Cultural Consumers in China and Japan, Korea
Observer, The Institute of Korean Studies 40.3 (2009), 425-459.
32
xiv
Badeges, Abdul Malik. Interview with Prof Ingyu Oh. Ingyu Oh is Senior
Lecturer at Bristol Business School, UWE, and Research. Fellow at the
Centre for East Asian Studies, Bristol University, U.K. He received his
Ph.D. in Sociology from the University of Oregon, U.S.A. He has formerly
taught at Waikato University, Ritsumeikan Asia Pacific University, and UC
Berkeley. His recent publications include ―Education and Development:
Why are Koreans Obsessed with Learning?‖ (2009) and ―Virtual
Corporation and Technology Innovation: The Role of Project Man-agers in
Neutralizing Uncertainties‖ (2009). E-mail: [email protected] Seoul, July
25, 2013.
xv
Chon, Taek-bu. (2007), Hallyu neun Baram eul Tago Hangul eun
Ssangdu-macha reul Tago [Hallyu Flying in the Wind, Hangul Riding a
Carriage and Pair]. Seoul: Yeyeong. Ibid,.
xvi
Ingyu Oh, Hallyu: The Rise of Transnational Cultural Consumers in
China and Japan, Korea Observer, Vol. 40, No. 3, Autumn 2009, pp. 425459. 2009 by The Institute of Korean Studies.
xvii
Badeges, Abdul Malik. Interview with Min Kim. Min Kim is a manager
in charge in the Creative Industry Promotion Division Music, Fashion &
Entertainment Team. Seoul, July 15, 2013.
xviii
Dal Yong Jin, Hallyu 2.0: The New Korean Wave In The Creative
Industry, II Journal, Fall 2012, University of Michigan.
xix
Allkpop.
2013.
Retrieved
July
27.
http://www.allkpop.com/article/2013/08/earnings-of-sm-yg-and-jyp-for-thefirst-half-of-2013-revealed#ixzz2gcMKkC3F
xx
Korea Investment & Securities Co., Ltd. 2013. ―SM Entertainment
(041510).
xxi
Korea Investment & Securities Co., Ltd. 2013. ―YG
Entertainment(122870).‖
xxii
Korea Investment & Securities Co., Ltd. 2013. ―Jyp Entertainment Corp
(035900:Korea Exchange - KOSDAQ)‖ Retrieved July 27.
http://investing.businessweek.com/research/stocks/financials/financials.asp?
ticker=035900:KS&dataset=incomeStatement&period=Q&currency=native
xxiii
http://investing.businessweek.com/research/stocks/financials/financials.asp?
ticker=035900:KS
xxiv
Ibid.,
xxv
Ibid.,
33
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