Recently, HYBE, South Korea's largest entertainment company, decided to remove Min Hee Jin from the position of CEO of its subsidiary ADOR and demoted her to producer. Members of ADOR's popular girl group NewJeans jumped out and broadcast live. In addition to asking the company to reinstate Min Hee Jin, the content also exposed the ostracism within the company. They even bluntly stated that they would not obey every order from HYBE. Since the opening of trading on the 11th, the day after the live broadcast broke out, HYBE's stock price has fallen 4.5% in two days. In addition to occupying an important position in the KPOP industry through mergers and acquisitions, HYBE Group’s founder Fang Siyue has also entered the blockchain industry. This article will reveal HYBE’s growth experience, current situation, and prospects for blockchain.
BTS, internationalization, mergers and acquisitions: pushing HYBE to the pinnacle of Korean Wave
HYBE Group, formerly known as Big Hit Entertainment, was founded by producer Bang Si-hyuk, who previously worked as a producer for Rain and others at JYP Entertainment. Bit Hit relies on its boy group BTS to become one of the four major entertainment companies in South Korea. How popular is BTS? For reference, BTS’s record sales in 2022 were second in the world, second only to Taylor Swift, and SEVENTEEN, the sixth-placed player on this list, is also a boy group of HYBE.
Before 2016, South Korea’s entertainment market was roughly divided between three companies: SM Entertainment, JYP Entertainment, and YG Entertainment. With its strategy of acquiring small and medium-sized companies and the growth of its artists, Big Hit has positioned itself at the top of the Korean entertainment industry. And changed its name to HYBE in 2021, retaining Big Hit as its label. Currently, HYBE’s labels and corresponding well-known artists include:
What makes HYBE different from other entertainment companies is its international strategy. It is understood that the company's revenue in the North American market has reached 26%. Since BTS became a global trend, groups under HYBE have also begun to move towards internationalization. BTS, LE SSERAFIM, etc. have all released English singles, which have been widely praised in the European and American markets. LE SSERAFIM even appeared on the stage of the famous music festival COACHELLA this year.
In 2021, HYBE acquired Ithaca Holdings for 1 trillion won. At that time, the company's well-known artists included Justin Bieber, Ariana Grande, etc. In 2023, HYBE America acquired QC Media Holdings for 314 billion won. The company's artists include: Migos丶Lil Baby丶Lil Yachty.
According to the data, the sales and net profits of HYBE’s brands from Q1 to Q3 2023
sales/net profit
Big Hit 4095億 / 1072億 (BTS、TXT)
Pledis 240 billion / 43.3 billion (SEVENTEEN)
Source Music 49.1 billion / 9.4 billion (LE SSERAFIM)
ADOR 87.3 billion / 20.5 billion (NewJeans)
KOZ 15.3 billion / -5.5 billion (Zico, BOYNEXTDOOR)
For comparison, HYBE has a market capitalization of 10.34 trillion won, SM 2.4 trillion won, YG 1.1 trillion won, and JYPE 1.1 trillion won. (Source)
Influence spreads across the four major entertainment companies, HYBE becomes the dominant player in Korean Wave
HYBE’s influence is not only reflected in its market value. In 2023, a forced marriage incident broke out at SM Entertainment, a veteran entertainment company. Lee Soo Man, the founder of SM and the godfather of Hallyu, was expelled by his nephew Lee Sung Soo and company representative Jung Young Joon. Kakao, South Korea's largest communications software, also acquired 9% of SM's shares by subscribing for new shares and convertible corporate bonds at this time, becoming the largest shareholding after Lee Soo Man. In this incident, HYBE also acquired 8.8% of SM Corporation’s shares.
In addition, HYBE has always had a good relationship with LINE’s parent company NAVER. NAVER’s interactive platform V LIVE and HYBE’s interactive platform Weverse will merge in 2023. HYBE EDU also merged with NAVER subsidiary Cake corp. NAVER owns 8.9% of YG Entertainment. In addition, Bang Si Hyuk worked as a producer at JYPE before founding Big Hit. In June, he collaborated with JYPE founder JYP to perform at a concert and was known as Socks CP.
It can be said that HYBE Group has penetrated the KPOP industry in terms of its own development and indirect relationships.
HYBE fires Min Hee Jin due to conflict caused by suspected power grab
On April 22, 2024, HYBE accused Min Xizhen, the representative director of its subsidiary ADOR, of intending to seize ADOR’s management rights and leak internal confidential information. Min Hee Jin immediately held a press conference on the 26th to counterattack, not only mentioning: "NewJeans was originally supposed to be the first girl group under HYBE, but was preempted by LE SSERAFIM. Because Source Music believed that the first girl group must be composed of Miyawaki Saki. The new girl group formed by Liang and Kim Chae-won (both of whom previously debuted with IZ*ONE, a talent-exclusive girl group) can compete with the highly popular IVE (members Zhang Yuanying and An Yuzhen are also former members of IZ*ONE).
In response to HYBE's accusation that she found a wizard to curse BTS members to enlist in the army, she said she just asked a friend who taught fortune telling, "How will NewJeans develop after BTS enlists in the army?" At the same time, she also accused HYBE's latest girl group illit of plagiarizing the style of NewJeans. In addition, Min Hee Jin also mentioned that Bang Si Hyuk once asked her: "Can I step on Aespa (a popular girl group under SM) under my feet?" After this press conference, her remarks caused an uproar among fans.
In August, HYBE decided to expel Min Hee-jin from her position as representative director at the ADOR shareholders’ meeting. Although she was still the producer of NewJeans, her power was insignificant. Director Shin Woo-seok, who has collaborated with NewJeans on MVs such as Ditto and ETA, also said that the new director of ADOR asked him to delete the video from the fan perspective. The news broke out and caused Bunnies (NewJeans fan name) to wail.
NewJeans publicly expresses distrust of HYBE
After Min Hee Jin was fired, NewJeans member Hanni uploaded a self-composed song, and Danielle and Minji also revealed their feelings to fans through interactive platforms.
"I really want to tell the Bunnies who are worried about us and comforting us that it's okay, but I don't have that confidence anymore. Even if we only share good things, we can't fill everyone's day, so why go through unnecessary hardship, really I'm sorry, I can't solve anything, it's so frustrating," Minji said.
On September 11, five members broadcast a live broadcast on the nwjns channel with the title "What NewJeans Want to Say" (the channel and account have been deleted). They emphasized that the live broadcast was spontaneous and was not directed by Min Xizhen. ADOR employees were not aware of this. thing.
The highlight of the live broadcast is that member Hanni said that they will not blindly follow HYBE's orders, and that HYBE has hindered their work, and it is even more difficult to believe that HYBE sincerely wants to help them. And asked HYBE to bring back Min Hee Jin within two weeks.
In addition, Hanni also revealed that when she met an artist and manager of a certain group within the company, she greeted them, but heard the other manager tell her to ignore her. It is still unclear when this incident occurred before and after the conflict broke out. In addition, although Hanni himself did not disclose it, Korean netizens generally identified the group as illit, which Min Hee Jin mentioned in a previous press conference, plagiarizing NewJeans. Hanni reported the matter to the new directors of ADOR, but received a response like "There is no evidence, it is too late."
HYBE officials also immediately responded to the incident. HYBE stated that the incident occurred in June, which was when the relationship between Min Hee Jin and HYBE was tense. The monitor was also called up and confirmed that Hanni and illit greeted each other.
Hanni said:
"Looking back now, I still can't understand why on earth this happened to me? I feel very speechless."
Haerin, the last member, said that videos and medical information from their trainee days were leaked, and the company that was supposed to protect them failed to fulfill its responsibilities, which made them distrust the company.
As for why the five members are so devoted to Min Hee Jin, it is understood that NewJeans has been in a very favorable environment since their debut. Living in a mansion by the Han River, getting enough sleep, not touring constantly, etc., although all of these are with the resources provided by HYBE. On the other hand, the mother of former member Minji also said in an interview that Source Music’s dormitories in the past were very dirty, had no specific debut plan for trainees, and encouraged students to abandon their studies. However, subsequent netizens speculated that Minji was still 13 years old and Source Music had not yet been acquired by HYBE.
The liquidated damages may be as high as NT$14.4 billion, and there is a mystery in the ultimatum during the live broadcast
After the incident, the community showed two major directions of public opinion, except that some fans continued to start wars with fans of other groups on the Internet. One side thinks it's amazing that NewJeans can stand up to the whales. On the other hand, they believe that everything returns to the law and system, and employees should not go on strike because of a change of supervisor, or pay liquidated damages if they want to leave.
Regarding Min Xizhen's behavior, some people believe that she is NewJeans' mother, but other people believe that she involved NewJeans in adult disputes, and believe that NewJeans' live broadcast is equivalent to publicly taking sides, which is very unwise. There are also a few people who have elevated the Min Hee Jin and NewJeans incidents to the problem of misogyny in Korean society. This part is left to the readers to interpret.
It is understood that NewJeans’ liquidated damages may be as high as NT$14.4 billion, which may not be a price that ordinary companies can afford. In addition, NewJeans mentioned in the live broadcast that the deadline for HYBE is the 25th, which happens to be the fourteenth day after the live broadcast on the 11th. What these two weeks represent is that in Korean law, if the contract has not expired and the artist wants to terminate the contract, he must clearly express his dissatisfaction, and the consensus period given to both parties is exactly two weeks.
Behind the entertainment giant, Fang Shiyue is actually a currency speculator? Revealed that he recently participated in over 100 million yuan in financing
It’s only been a week since Korea Blockchain Week. In fact, blockchain is gradually becoming visible in Korea, including Kpop. Chain News discusses and shares in Space:
"In this WebX and KBW, we can find that both Japan and South Korea are gradually combining entertainment with blockchain."
For example, tripleS, a 24-member large-scale girl group with Taiwanese member Xu Nianci, is promoted by Modhaus Studio. The company is committed to using blockchain to promote Korean pop culture. For example, fans can participate in some decisions about group operations in a similar way to community governance. Modhaus has received investment from Foresight Ventures.
The HYBE Group has also deployed blockchain as early as 2022. In October 2022, HYBE cooperated with Dunamu, the parent company of Upbit, South Korea's largest exchange, to launch the NFT platform Momentica. As a supplement, Kakao, South Korea's largest messaging software, also holds 10.88% of Dunamu's shares.
As for why the NFT theme was chosen, users can hold NFTs similar to virtual cards on Momentica. As the secret weapon of KPOP’s physical sales, fans can get bonus photo cards when they purchase the album. Many fans will buy hundreds of albums at each return to collect all versions of the card. However, there is currently no trend of the small card market shifting from physical to virtual.
In addition, Story Protocol, a new Korean startup that recently received over 100 million yuan in financing, is rumored to be one of the investors. According to local media reports, Story Protocol CEO Seungyoon Lee, who is only 33 years old, founded the English-language online novel platform Radish in 2016. Radish was acquired by Kakao in 2021 for 500 billion won. In addition to the support of the well-known venture capital a16z, Story Protocol is also an investor in South Korea’s Hashed, Samsung Next, and HYBE Group’s Fang Sihyeok.
The report pointed out that although the current copyright protection can manage the IP of individual creative works such as movies, TV series, and online comics, it cannot well reflect the complexity of their stories. Secondary creations such as fan fiction, fan art, and remixes will be guaranteed on Story Protocol. The company said: “The story is divided into characters, relationships, storylines, etc. like Lego, and the copyright is registered in the blockchain system. Fans or secondary creators can make sequels or write new stories as their own based on this. IP."
If Marvel registers the characters and plot of "Avengers" on Story Protocol, and fans create and register a new ending for "Avengers: Endgame" and Marvel makes a new movie based on it, then Profits will be distributed to fans.
Story Protocol is favored not only because of its novel ideas, but also because it has taken a different path among the constantly competing blockchain innovations. Just like AlphaGo and ChatGPT that emerged from the "deep learning winter", whether Story Protocol can break through the "cryptocurrency winter" has also attracted much attention.
This article HYBE vs. NewJeans! Revealing the secrets of Bulletproof Dad’s ambition to venture into blockchain first appeared on Chain News ABMedia.
